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Published: Saturday June 14, 2014 MYT 12:00:00 AM
Updated: Saturday June 14, 2014 MYT 7:15:18 AM

RM260mil aid package for airlines

CHANGI has extended a S$100mil (RM258mil) lifeline to help airlines cut costs amid a business slowdown that has hit not just the carriers, but the airport as well.

The one-year helping hand includes discounts of 50% on aircraft parking and 15% on aerobridge charges, as well as financial support for marketing campaigns to promote flights to Singapore.

Airlines that bring more traffic through Singapore will get additional rewards, the Changi Airport Group said yesterday, without providing more details.

The announcement comes in the wake of year-on-year declines in passenger traffic recorded by Changi in February and March. These were the first negative numbers seen since July 2009.

Prolonged political instability in Bangkok and the disappearance of Malaysia Airlines Flight MH370 more than three months ago have hit demand for air travel to and from two of Changi’s biggest markets – Thailand and China.

About two-thirds of MH370’s passengers were Chinese nationals.

Industry analysts noted that inbound tourist travel to Singapore has also been impacted by a stronger Singapore dollar against other regional currencies, and the airport is facing tough competition from other hubs in the Asia-Pacific and Middle East.

Dubbed the Growth and Assistance Incentive scheme, Changi’s new help package will kick off next month.

Aside from giving discounts and incentives, the airport will also help carriers as well as ground-handling and security companies boost operational efficiency, for example, by providing more self-service options for check-in and other processes.

The S$100mil (RM258mil) plan is the latest among several initiatives rolled out in the past decade to help airlines and other airport players cope with business downturns.

In all, more than S$800mil (RM2bil) has been disbursed since the Sars crisis in 2003.

Associate Professor Terence Fan of the Singapore Management University said: “Changi certainly does not want to see airlines stop flying here or cut back on flights, so it is doing its part to help the carriers.”

The cuts in aircraft parking and aerobridge charges will help low-cost carriers such as Tiger- air, which operate a higher number of flights with smaller planes, compared with full-service carriers, said UOB Kay Hian aviation analyst K. Ajith.

Singapore Airlines said it welcomes the support, and hopes the incentives will be extended. — The Straits Times / Asia News Network

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