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(20-07-2014, 12:51 AM)cfa Wrote: [ -> ]Air fares of SIA are not cheap but also chose to save fuels by fling over war zone ???

The answer to that would have to be YES Big Grin

but I think going forward they will be very very careful about choosing flight routes and also if they are cutting cost it be not from an area that could affect passenger safety.
(20-07-2014, 08:45 AM)BlueKelah Wrote: [ -> ][quote='cfa' pid='89251' dateline='1405788715']
Air fares of SIA are not cheap but also chose to save fuels by fling over war zone ???

And that's one of the way to stay profitable in a tough industry
Unless the geographical area has been declared as a "no fly" zone, and ICAO ( International Civil Aviation Organisation) issues notices, any flight can fly over such areas.

It may seem that pilots are able to fly anywhere they want but in reality there are limits. Imagine highways up in the air.

From Tampines to Tuas, you can choose to drive using the PIE or the TPE, SLE & KJE.
Same for the flight, only that they need to submit their choice which inlcudes the height they want. This is where congestion can happen as every flight wants a higher altitude as it burns less fuel and more speed ( thinner air ).

They also need to consider emergency landing points and also facilities that will support the aircraft type. ( Runway lengths, altitude of the Himalayas ). These routes are well travelled and almost a template for many pilots... the only factors that may affect the route would be weather ( summer & winters, wind patterns change )

Fuel burn is a major issue with airlines and pilots have to submit reports on why they used excess fuel for taxiing, flying.
Depending on destinations, the fuel carried is optimised for the trip... there is no benfit in carrying more as it adds weight.

It may sound alarming but there are regulations on minimum fuel carried. This is where the skill of the pilots is valued.
Much like a fund manager: Does he keep too much cash in reserve or uses it to invest for higher returns?

Besides that, he will have to know how to handle emergencies... in aviation, each landing is a Controlled Crash with predictable outcomes.
There is this "disconnect" between what lay people like us think what is possible/not possible versus people in the airline industry/ICAO, resulting in this question of why fly over conflict zone.

Also, the question of how does one define a conflict zone and the risk they pose to commercial flights is another question that bears further exploration.
Clipped wings - branding also useless... LCCs has resulted in structural changes in aviation industry... engineering firms affected by extended usage for aircraft and hence margins squeeze. Ground handling also affected by reduced meal sizes and potentially baggage volumes. Only Airport operator benefit from rising volume of air travel and rental of airport space to retail and carparkings...

Singapore Airlines warns of more turbulence for sector amid Q1 slump
THE AUSTRALIAN AUGUST 01, 2014 12:00AM

Steve Creedy

Aviation Editor
Sydney
Singapore warns of more turbulence
Singapore Airlines says revenue fell 4.1 per cent to $S3.68 billion as the company was forced to sell more seats at a discount to fill planes. Source: AFP
SINGAPORE Airlines says the outlook for the industry has become “more challenging” and that it expects fares and yields to remain under pressure.

The Singaporean carrier ­reported first-quarter net profit fell 71 per cent to $S35 million ($30.1m) from $S122m a year earlier, marking its third consecutive decline in quarterly net profit.

Revenue fell 4.1 per cent to $S3.68 billion as the company was forced to sell more seats at a discount to fill planes.

“The outlook for the air transportation industry has become more challenging with continuing uncertain global economic climate, geopolitical concerns in the region and elevated fuel prices,’’ it said.

“Load factors in the current quarter are expected to be stable year on year. Aggressive fares and capacity injections from competitors will continue to place pressure on yields.’’

Passenger yield or revenue per passenger per kilometre flown declined 1.8 per cent from a year earlier to S10.9c in the quarter.

Demand for air travel in Asia has not grown as fast as the region’s premium airlines initially expected, and they face compe­tition from highly aggressive ­budget airlines such as Malaysia’s AirAsia on regional routes and from Gulf-based carriers such as Emirates and Qatar Airways on longer routes to Europe and the US

Most full-service airlines in Southeast Asia reported a loss last year as they were forced to offer steep discounts to fill planes.

SilkAir, the regional unit of Singapore Airlines, also reported a sharp decline in operating profit to $S2m in the first quarter from $S14m a year earlier.

SIA Cargo, the freight unit, narrowed its operational loss to $S18m from $S40m as it reduced capacity to match demand.

Singapore Airlines said it ­expected overcapacity to hurt its cargo business, though ­demand for air freight was slowly ­recovering.

Additional reporting:
The Wall Street Journal
As per our discussions 15 months ago, I think SIA is slowly but surely losing its edge. management need to wake up to long term strategic benefits and goals instead of short term profit focus. (Sounds familiar to the Singapore Inc mentality)

(01-04-2013, 07:49 PM)specuvestor Wrote: [ -> ]
(01-04-2013, 01:21 PM)kazukirai Wrote: [ -> ]A blog post by a Mr Emmanuel Daniel (I'm not sure about his background. His bio page on his site takes too long to load) but some anecdotes on the current state of affairs over at SIA. If anything this guy says turns out untrue, then we should be seeing SIA respond in due course.

Anyhow, might be worth noting for those vested. For those not-vested, makes nice reading too.

http://www.emmanueldaniel.com/?p=807

This is a great article. I always think management is very important for a company. In that aspect I differ from Buffett: while we agree in buying companies that even a fool can manage, because at some point of time one will, I will be selling out when that happens. An M&A overnight by a fool can change the company totally.

I feel strongly that SIA had been squandering the moat it built up on its past successes, and recent foray into Tiger and Scoot shows that management is getting clueless how to run an airline. The moat will eventually disappear for SIA if they continue to get clueless scholars and military men to run the company.

Even a 败家仔 can't bankrupt the family fortune overnight, but eventually it will.
http://www.valuebuddies.com/thread-261-p...l#pid46224

I read and remembered that the most efficient route is actually not high altitude because the earth is round. Higher u go the greater the circumference to travel. But optimally of course they need to cruise at certain altitude to avoid congestions. Maybe its a balance between what u mention?

(20-07-2014, 09:48 AM)Porkbelly Wrote: [ -> ]From Tampines to Tuas, you can choose to drive using the PIE or the TPE, SLE & KJE.
Same for the flight, only that they need to submit their choice which inlcudes the height they want. This is where congestion can happen as every flight wants a higher altitude as it burns less fuel and more speed ( thinner air ).
(01-04-2013, 07:49 PM)specuvestor Wrote: [ -> ]
(01-04-2013, 01:21 PM)kazukirai Wrote: [ -> ]A blog post by a Mr Emmanuel Daniel (I'm not sure about his background. His bio page on his site takes too long to load) but some anecdotes on the current state of affairs over at SIA. If anything this guy says turns out untrue, then we should be seeing SIA respond in due course.

Anyhow, might be worth noting for those vested. For those not-vested, makes nice reading too.

http://www.emmanueldaniel.com/?p=807

This is a great article. I always think management is very important for a company. In that aspect I differ from Buffett: while we agree in buying companies that even a fool can manage, because at some point of time one will, I will be selling out when that happens. An M&A overnight by a fool can change the company totally.

I feel strongly that SIA had been squandering the moat it built up on its past successes, and recent foray into Tiger and Scoot shows that management is getting clueless how to run an airline. The moat will eventually disappear for SIA if they continue to get clueless scholars and military men to run the company.

Even a 败家仔 can't bankrupt the family fortune overnight, but eventually it will.

A great article indeed. For those who attended the last AGM, it is clear how “weak” or “colourless” CEO Goh is. At one time, I was so pissed off that I almost wanted to stand up and ask the Chairman to let the CEO speak! The same happens at SIA Engineering AGM. I hope the day-to-day running at SIA is not like this. They really need a CEO who has his own character and can stand on his own.
Jialat... how to progress without rebels to shake off complacency?

(01-08-2014, 12:18 PM)Ben Wrote: [ -> ]
(01-04-2013, 07:49 PM)specuvestor Wrote: [ -> ]
(01-04-2013, 01:21 PM)kazukirai Wrote: [ -> ]A blog post by a Mr Emmanuel Daniel (I'm not sure about his background. His bio page on his site takes too long to load) but some anecdotes on the current state of affairs over at SIA. If anything this guy says turns out untrue, then we should be seeing SIA respond in due course.

Anyhow, might be worth noting for those vested. For those not-vested, makes nice reading too.

http://www.emmanueldaniel.com/?p=807

This is a great article. I always think management is very important for a company. In that aspect I differ from Buffett: while we agree in buying companies that even a fool can manage, because at some point of time one will, I will be selling out when that happens. An M&A overnight by a fool can change the company totally.

I feel strongly that SIA had been squandering the moat it built up on its past successes, and recent foray into Tiger and Scoot shows that management is getting clueless how to run an airline. The moat will eventually disappear for SIA if they continue to get clueless scholars and military men to run the company.

Even a 败家仔 can't bankrupt the family fortune overnight, but eventually it will.

A great article indeed. For those who attended the last AGM, it is clear how “weak” or “colourless” CEO Goh is. At one time, I was so pissed off that I almost wanted to stand up and ask the Chairman to let the CEO speak! The same happens at SIA Engineering AGM. I hope the day-to-day running at SIA is not like this. They really need a CEO who has his own character and can stand on his own.
^^ JY Pillay was not a rebel per se either. Lack of strategy, focusing on short term response is the main issue. A public service mentality and a profit driven mentality is very different
Out of curiosity, I went to do some background check on DBS and SIA. Though the two companies operate in different industry, they are both Temasek link company and so the tone at the top should be similar. Both companies are leaders in their industry with valuable brand names.

Piyush Gupta (PG), 54 years old, was appointed CEO of DBS on 9 Nov, 2009.

Goh Choon Phong (GCP), 50 years old, was appointed CEO of SIA on 3 Sep, 2010.

Both guys took over the hot seats when their respective industries were in difficult times. DBS has to deal with the greatest financial crisis in history since the Great Depression in 1929/1930. Its cost to income ratio was not competitive as compared to its peer. For SIA, the challenge from budget airlines is increasing rapidly and the company has to tackle the issue of high fuel prices.

Over the years, DBS, or rather POSB, has almost lost its’ “People’s Bank” reputation. The bank operates in a business-like manner. However, in the last few years, we saw that the bank has took initiatives to roll out programs to win back the trust of the man on the street and now prides itself on being “Neighbour first, bankers second”.

As for SIA, I really don’t have a clear idea of what they are driving at for the past few years.

Both companies pride itself of being the top brand in Singapore. Below is their brand values and position from 2009 to 2014:

2009 2010 2011 2012 2013 2014
Value Position Value Position Value Position Value Position Value Position Value Position
SIA 2,776 1 3,654 1 3,757 1 3,218 1 3,117 2 3,250 2
DBS 1,362 3 1,520 3 2,041 3 2,316 3 3,476 1 4,011 1

Value in USD $M

(Sorry, the table is not align properly)

Under PG stewardship, DBS brand value increased from $1,362M in 2009 to $4,011 in 2014, an increase of almost 200%. It even became the most valuable brand in 2013, taking away the pole position from SIA who has been in number 1 position for the longest time. If PG could somehow monetize 1% of the increased in brand value over the years, he would have been richer by USD26.5M (1% of USD4,011M – USD1,362M), or an average of USD5.3M a year!

SIA has a very different outcome. Under GCP leadership, its brand value declined from $3,654M in 2010 (the year GCP became CEO) to $3,250M in 2014, and taking the second spot after DBS. So over the last four years, our prestigious airline lost $404M of brand value. It is one thing to lose the top position but still managed to increase its brand value. It is a total different thing to lose both. I hope SIA don’t concede its second position to Wilmar in the future, who is in third place now.

And by now, we all know that SIA has reported a weak Q1 results, with PATMI lower by 71%. For DBS, they reported another record performance with 1H earning crossing $2B mark for the first time.

Indeed, a CEO is very important to an organisation.