Continued investment in airport infrastructure vital to growth of Bangladesh’s aviation industry

Singapore Airlines (SIA) received the world's best airline award in Paris in June this year. Another ranking places SIA at the second. What are the strengths that keep SIA above other global giants?

We are very grateful to our customers for their enduring loyalty and affection for Singapore Airlines. During the pandemic, their support and encouragement gave us the strength and determination to overcome the unprecedented challenges.

As we recover from the pandemic, we remain firmly committed to innovating and investing in industry-leading products and services, and ensuring that SIA continues to offer our customers a world-class travel experience.

We continue to invest in the three pillars of SIA's brand promise of service excellence, product leadership and network connectivity. This builds on our long-standing strengths and will help ensure that we retain our leadership position.

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In the area of service excellence, we focus our efforts on providing seamless and personalised customer experience and leveraging technology to deliver world-class service for our customers.

We continue to make multi-million dollar investments in our products and services to delight our customers both on the ground and in the air with state-of-the-art technology. For example, customers in all cabin classes are now able to enjoy complimentary in-flight Wi-Fi when travelling on SIA-operated flights. 

SIA makes significant investments in buying and operating new-generation aircraft to ensure that we maintain a young and modern fleet, helping to achieve further operating efficiencies and support ongoing efforts to materially lower carbon emissions. As of 1 October 2023, the SIA Group has a total of 202 aircraft in its fleet and another 96 aircraft on firm order.

The Group is also focused on enhancing our network through both organic growth and strengthening our partnerships with other airlines. As of 1 October 2023, our route network including codeshare partners extends to 371 destinations in 81 countries and territories.

The global aviation market is growing at over a 3% annual average rate and is projected to reach $635 billion by 2030. Where do you expect to see SIA in the aviation world by then?

We are confident about the future of air travel. The Group's commitment to offering best-in-class products and services, our agility and resilience, as well as our dedicated and talented staff members, will continue to help us strengthen our leadership position in the airline industry.

What will be the driving force of future growth in the aviation industry?

Sustainability is a key driving force for the future of the airline industry and is a key part of the SIA Group's strategy.

The Group supports the United Nations 2030 Agenda for Sustainable Development, which outlines 17 Sustainable Development Goals (SDGs). 

We have a long-standing strategy of working towards decarbonisation and environmental sustainability across our operations by implementing environmental, social and governance (EGS) initiatives. The Group's ESG initiatives are focused on three pillars: i) achieving net zero carbon emissions by 2050, ii) reducing waste across our operations, and iii) making a positive impact on society.

Some of our ESG initiatives include continued investments in new generation aircraft, such as the Airbus A350s and Boeing 787s, which burn up to 25% less fuel than older generation aircraft and help us achieve higher operational efficiencies.

SIA also continues to collaborate with governments, the airline industry and partners such as aircraft manufacturers, technology providers and fuel suppliers, both in Singapore and around the world, to help accelerate the development, production and adoption of Sustainable Aviation Fuel (SAF).

Since June 2021, our customers have had the option to purchase quality carbon offsets through the Group's voluntary carbon offset programme via dedicated microsites.

Will Asia continue to dominate? How stiff will the competition be in years to come?

The demand for air travel is expected to remain robust for all route regions, with forward passenger bookings closely tracking capacity injection across most markets. The Group is well positioned in this operating environment, even as competition is expected to intensify as more capacity is injected into international routes. The Group will monitor these trends closely, and adjust its capacity and network accordingly.

What are the major challenges for airlines and how those could be faced?

One of the major challenges facing airlines operating in Bangladesh currently is the economic situation in the country – particularly inflationary pressures and foreign currency liquidity for repatriation of funds.

The present currency repatriation difficulties are impacting foreign airlines' timely access to their collection proceeds to meet payment obligations and increasing exposure to adverse foreign exchange movements.

Both domestic and international airline services are important contributors to economic growth and social development in Bangladesh. According to IATA, the air transport industry supported 125,000 jobs and $728 million in annual GDP in pre-Covid-19 Bangladesh. Internationally, air transport is an important enabler in achieving economic growth and development by providing vital connectivity and integration with the global economy.

We seek the government's support to consider the importance of aviation to the country's economy and to provide a higher allocation of foreign exchange for the airlines through our respective authorised dealer banks.

Singapore Airlines has reported a robust quarterly net profit boosted by passenger demand. It has a strategic fleet and route expansion plan, merger and regional cooperation in aviation. Does Bangladesh have a place in SIA's future journey?

SIA has been serving Bangladesh for 37 years since October 1986 and SIA remains committed to supporting the growth of this market over the long term. We review our network regularly to match capacity with demand. 

SIA currently operates daily services (7x weekly) between Dhaka and Singapore, and we are looking to increase our frequency in 2024.

Airlines have been focusing on budget flights and Scoot, your budget arm, has a strong presence in SIA's service. Do you think budget flights should expand more to help travellers with their air trips within their budget?

The Group is committed to its portfolio strategy, with SIA serving the full-service market and Scoot, serving the low-fare market segment. This ensures that the Group is able to deploy the right vehicles to the right markets with the right cost structure to cover all segments of the market. 

Through cross-selling on Scoot, SIA is able to bring value and greater connectivity for our customers, particularly to regional destinations in Southeast Asia where SIA currently does not operate. Today, SIA customers may purchase a single-ticket itinerary that enables passengers to travel from Dhaka on SIA and connect seamlessly to a Scoot-operated flight from our hub in Singapore – without having to check-in again.

Bangladesh also envisions being an aviation hub and plans to enhance the fleet of its national flag carrier. There are private airlines operating international flights. Terminal 3 at Hazrat Shahjalal International Airport had a soft opening this month. What are your views on Bangladesh's aviation industry's future?

As a foreign carrier, it is encouraging to see the government setting aside resources to invest in developing Bangladesh into an aviation hub. SIA looks forward to supporting growth in passenger traffic and cargo shipments through the new Terminal 3 at Hazrat Shahjalal International Airport when it opens fully in 2024. 

We also welcome plans by the government to introduce a second ground handler at Dhaka airport. Such competition is beneficial not just for airlines but also for the customers we serve as it brings about innovation and improvement in service standards.

The air transport sector contributed hugely to the island nation's economy over the decades. According to Oxford Economics, air transport created 375,000 jobs, and contributed $36 billion in gross value addition and 11.8% to GDP in Singapore. Given SIA's long presence in Bangladesh, what prospects do you see in Bangladesh's air transport? What policy and infrastructural support is needed for the air transport sector here to grow further and contribute more to the Bangladeshi economy?

Bangladesh has made remarkable progress in economic and social development over the past two decades. Despite the current economic challenges, we see this market continuing to grow over the medium term. SIA remains committed to supporting Bangladesh's growth and serving this market to connect its people to Singapore as well as to the rest of the world. We believe that continued investment in airport infrastructure and technology as well as training are vital to the growth of Bangladesh's air transport industry. It is also important that the government continues to encourage competition in the sector which will benefit the customers whom we serve.