2. Indian Government decided to allow Foreign
Direct Investment (FDI) in the Aviation Sector.
Thereby, Singapore International Airlines (SIA)
was considering a strategic partnership with
TATA Group with the US$100 bn. to form a full
service airline to serve domestic market.
However, TATA had just announced its
partnership with Malaysia’s AirAsia to form a
low-cost carrier service in India.
For SIA, it raised an open question about the
possible dangers of partnering with a company
that was starting a low-cost airline in parallel,
3. Singapore International
Airlines (SIA) was founded in
1972 .
SIA had evolved over 4 decades from a regional
airline to one of the most respected travel brands
across the globe.
SIA had positioned itself as a leader in customer
service, offering extravagant standards on the
ground and new level of comforts, cuisine and
entertainment in the air.
It focused on the geographical segments of
Southeast Asia, East Asia, South Asia and the
“Kangaroo Route” which flew passengers between
UK and Australia.
4.
5. SIA Operating Earning
• In 2000, to increase the number of
destinations it served, SIA joined the
Star Alliance network of airlines via
code sharing.
• The Most notable work of SIA was to
launch the world’ largest non-stop
commercial flight from Singapore to Los
Angeles in 2004; taking delivery of
world’s first Airbus 380 in 2007.
•SIA also became the first carrier
to operate all-business class non
-stop flight from Singapore to
New York in 2008.
• In FY 2011/2012, the airline reported
total revenues of $9.6 billion with net
profits of $310 million.
• Since it started operations , SIA has
never posted a negative annual return.
6. The Indian Aviation Market
• The Indian Aviation Market was the ninth largest in the
world in terms of passenger traffic and reported total
revenue of$9.5 Billion with the losses of $1.65billion.
• With liberalization of the market and the entry of
domestic low-cost airlines is rapidly grew their market
share to reach 59% early 2013.
• For the second most population country in the world with
1.22 billion people, this represented a tiny fraction. The
primary alternative means of transport for long distance
travel – the railways – carried 23 million passengers
daily.
• Over the next 10 years investment of $30 billions would
be necessary for upgrading existing airports provisioning
for second airport in all metro cities and constructing
green field airport.
8. SIA : Entering The Indian Market ?
India was the Sixth Largest market for the
SIA group.
4% share of the international skies from
India.
Restricted growth – refusal of Indian govt.
Partnership with TATA (Ongoing issue
with Air Aisa
Foremost concern – to make sure that the
rationale for entering Indian airline industry
was solid.
