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July 30, 2009
AssIA lost $307m, cut pay
By Karamjit Kaur, Aviation Correspondent
Singapore Airlines warned it could post a full year loss if adverse conditions continued, but said that its cash position remains strong and it does not need to raise capital. --PHOTO: SIA
SINGAPORE Airlines which lost $307 million in the April-June quarter will cut staff pay by 10 per cent as it continues to struggle amid tough operating conditions.
As if that were not bad enough, the airline has also warned that unless things get better soon, SIA could post its first-ever full-year loss.
Before this, the company has suffered a quarterly loss only once since it went public in 1985 - when Sars hit the region in 2003.
In a statement on Thursday, the airline said: 'The Group's first quarter performance reflected the adverse business conditions for airlines. If these conditions continue, the Group expects to make a loss for the full year.'
Battered by the economic downturn and the H1N1 flu outbreak, as well as the cost of fuel hedging, revenues in the three months to end-June fell 30 per cent to $2.87 billion, compared with the same three months before.
Total expenditure at $3.19 billion was 15.8 per cent lower than the same quarter last year but it did nothing to boost the bottomline.
In the end, the parent airline recorded an operating loss of $271 million.
As per agreements reached with its three unions, staff will see their pay cut by 10 per cent.
The deal was that SIA will cut all of the monthly variable component (MVC) built into staff salaries if the airline loses more than $200 million.
The MVC makes up 10 per cent of an employee's total pay. Management staff who have already taken pay cuts of between 10 and 20 per cent will not have their pay cut again, the airline said.
Latest comments
This is the time for premium service provider to conquer the market pie by competitive pricing...and yet with maintaining the premium services. This is the time to enlarge the customer base. See what a 20% reduction in price can do to the increase in % of customer traffic, esp for a premier airline like SIA. surely, you can take on more passengers...and makes full use of the empty seats...and let more enjoy the services and let the word of mouth be back to where SIA can be. The many Middle East Airlines are improving on their services and they can do at lower costs, as they have the hunger to take away the global market pie of the past leaders...because they want to be the future leader. Look at Qatar Airways, Etihad Airlines....very good service, new planes, and yet much lower fares. Most flights are full...and they are making more destinations. SIA has a great brand...but great brand need not always come with an expensive tag especially during bad economic times. The smart airline will move with the affordability, and increase standards of services while lowering the prices....that would be great. If SIA can increase passenger traffic, grow her customer base in bad times, when the good times come back, she will make even more.....thats the challenge, and surely, there would not be need to cut salaries. Let the crew be innovative and improve,..let the crew make each flight an unforgettable experience for the passenger...create a new magic of travelling with SIA....make the passenger feel that the dollar they spent is worth a lot because of the supreme service...compared to the same amount they spend on another airline....accept it....affordability has come down...businesses are a lot more prudent....and all are prepared to downgrade the status of the airplane for want of costs savings....remove the minimum conditon of two to travel in order to enjoy the lower pricing....when u do that....u make it difficult....and most times....loses both passengers....u have none instead of at least one...more...and it adds up....
Posted by: nicholaskoh222 at Fri Jul 31 05:03:43 SGT 2009
First, chuck out all the VP's and MD's of the various divisions. All these pen- pushers are earning too much money for doing nuffin. Yet the crew and support staff have to suffer.
Air fares are still too high. All these promotions are so called..and SQ must now live with it.
For now, the airline that even other airlines talk about must bite the hard stuff and give back in fair prices to their customers and once again prepare to offer better service.
Because we now have more choice from other airlines who want our business, wherever we are.
Posted by: sharlynrj at Fri Jul 31 00:17:36 SGT 2009
When all things sound so good then, they let out the bad news????
Are there something behind?
Are they saying that the good is only a paper tiger?
Posted by: sakuratoratora at Thu Jul 30 23:29:03 SGT 2009
What is the share price?
Recommended was $8.80.
Posted by: CCLCCLCCL at Thu Jul 30 22:25:18 SGT 2009
Is that all?
How much more?
Posted by: CCLCCLCCL at Thu Jul 30 22:24:45 SGT 2009
July 30, 2009
AssIA lost $307m, cut pay
By Karamjit Kaur, Aviation Correspondent
Singapore Airlines warned it could post a full year loss if adverse conditions continued, but said that its cash position remains strong and it does not need to raise capital. --PHOTO: SIA
SINGAPORE Airlines which lost $307 million in the April-June quarter will cut staff pay by 10 per cent as it continues to struggle amid tough operating conditions.
As if that were not bad enough, the airline has also warned that unless things get better soon, SIA could post its first-ever full-year loss.
Before this, the company has suffered a quarterly loss only once since it went public in 1985 - when Sars hit the region in 2003.
In a statement on Thursday, the airline said: 'The Group's first quarter performance reflected the adverse business conditions for airlines. If these conditions continue, the Group expects to make a loss for the full year.'
Battered by the economic downturn and the H1N1 flu outbreak, as well as the cost of fuel hedging, revenues in the three months to end-June fell 30 per cent to $2.87 billion, compared with the same three months before.
Total expenditure at $3.19 billion was 15.8 per cent lower than the same quarter last year but it did nothing to boost the bottomline.
In the end, the parent airline recorded an operating loss of $271 million.
As per agreements reached with its three unions, staff will see their pay cut by 10 per cent.
The deal was that SIA will cut all of the monthly variable component (MVC) built into staff salaries if the airline loses more than $200 million.
The MVC makes up 10 per cent of an employee's total pay. Management staff who have already taken pay cuts of between 10 and 20 per cent will not have their pay cut again, the airline said.
Latest comments
This is the time for premium service provider to conquer the market pie by competitive pricing...and yet with maintaining the premium services. This is the time to enlarge the customer base. See what a 20% reduction in price can do to the increase in % of customer traffic, esp for a premier airline like SIA. surely, you can take on more passengers...and makes full use of the empty seats...and let more enjoy the services and let the word of mouth be back to where SIA can be. The many Middle East Airlines are improving on their services and they can do at lower costs, as they have the hunger to take away the global market pie of the past leaders...because they want to be the future leader. Look at Qatar Airways, Etihad Airlines....very good service, new planes, and yet much lower fares. Most flights are full...and they are making more destinations. SIA has a great brand...but great brand need not always come with an expensive tag especially during bad economic times. The smart airline will move with the affordability, and increase standards of services while lowering the prices....that would be great. If SIA can increase passenger traffic, grow her customer base in bad times, when the good times come back, she will make even more.....thats the challenge, and surely, there would not be need to cut salaries. Let the crew be innovative and improve,..let the crew make each flight an unforgettable experience for the passenger...create a new magic of travelling with SIA....make the passenger feel that the dollar they spent is worth a lot because of the supreme service...compared to the same amount they spend on another airline....accept it....affordability has come down...businesses are a lot more prudent....and all are prepared to downgrade the status of the airplane for want of costs savings....remove the minimum conditon of two to travel in order to enjoy the lower pricing....when u do that....u make it difficult....and most times....loses both passengers....u have none instead of at least one...more...and it adds up....
Posted by: nicholaskoh222 at Fri Jul 31 05:03:43 SGT 2009
First, chuck out all the VP's and MD's of the various divisions. All these pen- pushers are earning too much money for doing nuffin. Yet the crew and support staff have to suffer.
Air fares are still too high. All these promotions are so called..and SQ must now live with it.
For now, the airline that even other airlines talk about must bite the hard stuff and give back in fair prices to their customers and once again prepare to offer better service.
Because we now have more choice from other airlines who want our business, wherever we are.
Posted by: sharlynrj at Fri Jul 31 00:17:36 SGT 2009
When all things sound so good then, they let out the bad news????
Are there something behind?
Are they saying that the good is only a paper tiger?
Posted by: sakuratoratora at Thu Jul 30 23:29:03 SGT 2009
What is the share price?
Recommended was $8.80.
Posted by: CCLCCLCCL at Thu Jul 30 22:25:18 SGT 2009
Is that all?
How much more?
Posted by: CCLCCLCCL at Thu Jul 30 22:24:45 SGT 2009
