Is it time to travel?


Some people may think it is no big deal even if airlines stop flying altogether. After all commercial aviation only came about at the beginning of the last century. But its advent has changed the way we live, our expectations, and how we connect with the rest of the world. While that is not going to happen, it is nonetheless preposterous to assume we could as easily return to the pre-flying days.

On the contrary, many people are probably looking forward to travelling by air again as some countries begin to relax international travel restrictions. However, it is still early days. Australia, for example, announced only last week that it will not be opening its borders anytime soon.

Indications are that any relaxation is likely to be country-specific rather than universal or industry-driven. This may be dependent on a nation’s level of infection or reciprocity between the countries concerned. In Europe, some countries are considering “air bridges” between two countries similar to the “air corridor” being looked at between Australia and New Zealand.

Conversely, a country may not open its doors to visitors from certain countries.

To be expected, there will be new sets of travel rules . Some of these may be deterrent in nature. The UK, for example, requires all arrivals (with some exceptions) to self-quarantine at a private residence for 14 days. It would be difficult for a non-resident visitor to find such accommodation, failing which the government will arrange it at the expense of the traveller. It is tantamount to asking people not to visit. In any case, would you if you had to stay locked up in a room for the most part of your vacation?

Some airlines have criticized the British ruling. Ryanair chief executive Michael O’Leary called it “nonsensical” and Virgin Atlantic said demand for seats would continue to be low. However, the UK government may not be concerned with the slow take up if that is what it takes to prevent a second wave of infections.

It is therefore critical you check out the 14-day rule before you plan to visit a country.

So much has already been said about the new normal in travel etiquette. The majority of airlines and airports will almost certainly make it mandatory for passengers to wear masks or some form of face covering as well as subject them to thermal temperature checks.

If you fly Emirates out of Dubai, you may be subject to a blood test via a pin prick of the finger. More elaborate testing at some airports will require arriving passengers to be held at the airport until the results are known.

Other regulations may require infection-free certification. This could be a simple declaration via an app ahead of arrival or formal medical documentary proof. Some authorities may also require visitors to register for tracing via an app in the event that an infection is subsequently detected.

The need for social distancing may mean marked lanes for traffic flow, designated areas for certain categories of passengers, and spaced positions in lines at service stations, immigration and boarding. Electronic check-in and self-baggage drop-off may become the norm.

All these are easy to comply with if you cannot resist that pent-up wanderlust and are prepared to put up with arriving at the airport much earlier than usual, slow processing and procedural inconveniences. Many of us would recall the temperature checks during the SARS outbreak some 17 years ago.

But is it really time to travel?

Foremost must be how convinced you are that it is safe to travel since the world is still afflicted by the disease although a number of countries are reporting declining levels of infection. There are also concerns of a second wave of infections against an uncertain timeline in developing a vaccine.

New cases have been reported in Wuhan and northeast China near the Russian border a week after the country lowered the risk level, and in South Korea as well following the relaxation of social distancing measures.

If you must travel, you have to have faith in airports and airlines doing all that is possible to keep the environment safe. Many airports have stepped up cleaning of surfaces prone to be touched by travellers. Airlines are also doing deep cleaning of the cabin more frequently and disinfecting tray tables and seat belts. Most aircraft are said to have robust filter systems whose quality of recirculated air is on par with that of hospitals.

You can forget about the romance of air travel as airlines cut back on in-flight services to minimize human contact and interaction. Amenities such as hot towels, blankets, headsets and magazines will no longer be provided on board, so bring your own. On long flights, pre-packaged meals are offered. For business class, it may be bento boxes with all courses served ensemble. It will be just the bare basics to get you from place to another.

Local restrictions at your destination may affect your holiday plans. Limits on numbers, for example, mean long waits at attractions or the difficulty of securing reservations at restaurants. It also means you may not be able to travel with family and friends beyond a certain group size. Certain places of interest may still be closed, and others may restrict entry to foreigners.

Finally, it is the airfare that can pull you or hold you back. Many airlines have begun selling tickets into the future at attractive fares including no fees for change. The fares may be competitive initially as airlines try to recoup their losses, but the high costs of operating low loads particularly if it has to keep the middle seat empty or limit the capacity as well additional costs in implementing new health and security protocols will sooner or later drive up the fare.

For the traveller, it all comes down to a gamble on uncertainty.

UK self-quarantine rule criticized

As countries ease up on reopening their economies, the question remains in doubt as to how soon the airline industry would return to normalcy. Any relaxation in travel restrictions that are in the offing seems to be deterrent in nature.

Courtesy Reuters

Most airports will require passengers to wear masks or some form of face covering and be subject to thermal temperature testing. These are easy to comply with. But when the United Kingdom announced that it would require any arrival from abroad with the exception of Ireland to self-quarantine at a private residence, that seems to tell non-residents not to visit.

Failure to comply would result in a fine of £1,000.

Questions have been raised about how non-residents may find accommodation with a private address. In its absence, the UK government has now clarified it would make the arrangement. This may well be academic as, indeed, why would someone visit a country if they had to stay quarantined for 14 days?

While many countries still require arrivals from abroad to self-quarantine, airlines with interest in the UK have criticized the proposal as a faux opening move that could only add to the woes of the industry which saw travel plummeting by as much as 99 per cent caused by the Covid-19 pandemic.

Ryanair chief executive Michael O’Leary was particularly critical, slamming the proposal as “nonsensical” and “unenforceable and un-policeable.” He said: “What we’re against are overly ineffective measures such as this nonsensical two-week isolation which applies if you’re not French or you;re not Irish.”

Mr O’Leary argued that the basis for exemption was not science based. The UK government has since backtracked on its decision for arrivals from France.

The Irish government warned Irish travellers that exemption to enter the UK does not mean they would be exempt from self-quarantine when returning to Ireland.

UK Airport Operators Association chief Karen Dee suggested instead a risk-based approach with agreements between countries on a “bridge” for safe travellers who would then not be subject to having to self-quarantine. New Zealand and Australia were already considering such an air corridor between the two countries.

The UK proposal may come into effect next month, but Virgin Atlantic is not optimistic. The airline said the ruling would “prevent flights from resuming” before August because there “simply won’t be sufficient demand”.

On the other hand, the UK government may not be all too concerned about the take-up being slow if that’s what it takes to guard against a second wave of coronavirus infections.

Ultimately it is a question of whether the country is ready to open up and the measured risks it is prepared to take with reasonable safeguards in place.

Déjà vu for Singapore Airlines as Virgin Australia goes bust

Courtesy AFP

Virgin Australia joins UK’s domestic carrier Flybe in a list whose number is expected to increase of carriers going bust because of the Covid-19 pandemic. The Australian carrier’s request for aid to the tune of A$1.4 billion in loans convertible to equity was allegedly rejected by the government which said it “is not in the business of owning an airline.”

Virgin Australia which posted losses in the last seven years was A$5 billion (US$3.15 billion) in debt as at Dec 31, 2019. Its chief executive Paul Scurrah remained hopeful that the airline’s decision to go into voluntary administration while seeking new investors would secure its future and see it “emerging on the other side of the Covid-19 crisis.”

As Australia’s second largest airline set up to rival Qantas, Virgin Australia is trumping the card that the country needs a second airline as its exit would mean a near monopoly for its competitor.

Interestingly, Virgin Australia is 90-per cent foreign owned comprising the following partners: Etihad Airways (20%), Singapore Airlines (20%), China’s Nanshan Group (20%), China’s HNA Group which also owns Hainan Airlines (20%), and Richard Banson’s Virgin Group (10%).

For SIA, it is déjà vu as far as the Virgin brand is concerned. In 1999 SIA made headline news when it acquired a 49-per cent stake in Virgin Atlantic. A small but very successful airline which made it to the ranks of the world’s best was making a big move at a time when it was pursuing trans-Atlantic rights eyeing a link between London Heathrow and New York. However, the investment turned out to be lacklustre, and for many years after SIA made it known it was ready divest the stake. It took more than a decade for that to happen in 2012 when the stake was sold to Delta Air Lines at a hefty loss.

In that same year, SIA entered into marketing alliances with Virgin Australia and Virgin America. It was later to take up a stake in Virgin Australia, initially 10 per cent which increased to 20 per cent in 2013. It was interesting how this was then seen as a tussle for dominance between SIA and Air New Zealand (Air NZ) which was to later sell off its entire shareholding. It was reminiscent of the time back in 1999/2000 after the big Virgin hype when SIA and Air NZ were locked in battle over Ansett Australia. SIA became badly bruised subsequently in its acquisition of a 25-per cent stake in the ailing airline.

It would appear that SIA has a penchant for the Virgin brand. Both are reputable names, so any association can only mean strength in unity. A stake in Virgin Atlantic should give it a strong toehold in American market, as would its commercial tie-up with Virgin America. So too a stake in Virgin Australia, particularly in light of the competition with Qantas not just domestically through Virgin but internationally.

Yet the strategy seems to be not working as expected, turning out to be more expedient and circumstantial than constructive and advantageous. Perhaps when SIA finally relieved itself of the burden of ill-reputed Tiger Australia, selling its remaining stake to Virgin Australia for a dollar, it was a timely moment of strategic correction despite the conviction of then Virgin chief executive John Borghetti that “we will benefit from the economies and achieve profitability ahead of schedule by the end of 2016.”

Reading the crystal ball is no easy game. There are an abundant of risks but hopefully described as calculated rather than random. Or does one stick to the knitting? Even that comes with the risks of stagnation if you lag behind the competition.

In 2013, SIA announced a joint venture with India’s Tata Sons to set up a new airline based in New Delhi. It was third time lucky for SIA, which had made an earlier attempt with Tata but rebuffed by a change in the country’s civil aviation in 1997 that prevented foreign carriers from holding any stake in domestic markets. In 2000 they made a bid for a 40-per cent stake in Air India but met with political opposition which again rocked the application, leading to a withdrawal by SIA a year later. Within a year of operations, Vistara carried its millionth passenger.

SIA is said to be impressed by Vistara’s performance so far. The joint-venture airline which commenced operations in 2015 is expected to turn in a profit within five years. So it is crunch time to prove sceptics wrong. Perhaps then SIA has got it right this time.

2019 Skytrax World Airline Awards: Who are the real winners?

It’s that time of the year when the airline industry is abuzz with the Skytrax World Airline Awards announced recently at the Paris Air Show.

There are surveys and there are surveys, if you know what I mean. Skytrax, which launched its survey back in 1999 (according to its website) is generally viewed with some regard. It is said that more than 21 million respondents participated in the 2019 survey.

But what can we read of the results?

Which is the real winner: Qatar Airways or Singapore Airlines?

Qatar Airways switched places with last year winner Singapore Airlines (SIA) to be the world’s best airline.

As far back as 2010 until now, the two airlines have been ranked one behind the other in the top three spots, except in 2012 when Asiana came in second place between Qatar the winner and SIA in third position. In the ten year period, SIA came behind Qatar in eight years, except in 2010 when SIA was second and Qatar third, and last year when the Singapore carrier became the world’s best ahead of Qatar in second placing.

It looks like a tight race between Qatar and SIA for the top spot, and going by the survey results, Qatar has outranked SIA. It has become the first airline to have won the award five times, one more in the history of the awards.

But SIA is still ranked ahead of Qatar for first class and economy class.

In the first class category, Qatar is not even a close second to SIA in first placing but fifth behind Lufthansa, Air France and Etihad as well

In the economy class category, Japan Airlines is tops followed by SIA and Qatar in second and third placing respectively.

Besides SIA has the best premium economy in Asia, second only to Virgin Atlantic worldwide. But,of course, Qatar does not offer that class of travel.

Additionally SIA tops for cabin crew, and Qatar is farther down the list in 9th position.

But Qatar wins for business class, followed by ANA and SIA in second and third placing respectively. So it seems there is heavier weightage for this segment which has become probably the fiercest battleground for the airlines. First class included, it also suggests the halo effect of the premium product, but it is the business class that is the primary focus in today’s business.

It also attests to the impact of the recency factor. Qatar obviously impresses with its cubicle-like Qsuite that comes with its own door to provide maximum privacy. Quad configurations allow businessmen to engage in conference as if they were in a meeting room and families to share their own private space. And there is a double bed option.

Which brings up the importance of having to continually innovate and upgrade the product to stay ahead in the race.

The top ten listing: Consistency equals excellence

The ranking does not shift much from year to year. Besides Qatar and SIA, there are some familiar names: All Nippon Airways (3rd this year), Cathay Pacific (4th), Emirates (5th), EVA Air (6th) and Lufthansa (9th). So there is not much of a big deal as airlines switch places so long as they remain in the premier list.

Hainan Airlines (7th) is making good progress, moving up one notch every year since 2017. Qantas (8th) is less consistent, moving in and out of the top ten list, Thai Airways retained its 10th spot for a second year.

It is no surprise that the list continues to be dominated by Asian carriers which are generally reputed for service. You only need to look at the winners for best cabin crew: Besides SIA, the list is made up of Garuda Indonesia, ANA, Thai Airways, EVA Air, Cathay Pacific, Hainan Airlines, Japan Airlines and China Airlines. With the exception of Qatar, no other airline outside Asia is listed.

If you to look to find out how the United States carriers are performing, scroll down the extended list of the 100 best and you will see JetBlue Airways (40th), Delta Air Lines (41st), Southwest Airlines (47th), Alaska Airlines (54th), United Airlines (68th) and American Airlines (74th).

Home and regional rivalry

Rivalry between major home airlines or among competing regional carriers is often closely watched.

Air Canada, placed 31st ahead of rival WestJet at 55th can boast it is the best in North America. That’s how you can work the survey results to your advantage.

ANA (3rd) has consistently outdone arch rival JAL (11th). In fact, ANA has been the favoured airline in the past decade till now. It has Japan’s best airline staff and best cabin crew. Across Asia, it provides the best business class. Internationally, it provides the best airport services and business class onboard catering.

Asiana (28th) is favoured over Korean Air (35th ).

The big three Gulf carriers are ranked Qatar first, followed by Emirates (5th) and Etihad (29th).

Among the European carriers, Lufthansa (9th) leads the field, followed by Swiss International Air Lines (13th), Austrian Airlines (15th), KLM (18th), British Airways (19th), Virgin Atlantic (21st), Aeroflot (22nd), Air France (23rd), Iberia (26th) and Finnair (32nd).

What about low-cost carriers?

Worthy of note is how some budget carriers are ranked not far behind legacy airlines. AirAsia (20th) is best among cohorts. EasyJet (37th) and Norwegian Air Shuttle (39th) are not far behind the big guys in Europe. Among US carriers, Southwest Airlines (47th) is third after JetBlue (40th) and Delta (41st).

Also, pedigree parents do not necessarily produce top-ranked offshoots. Placed farther down the list are SIA’s subsidiary Scoot (64th) and the two Jetstar subsidiaries of Qantas – Jetstar Airways (53rd) and Jetstar Asia (81st). So too may be said of so-called regional arms. Cathay Pacific’s Cathay Dragon is ranked 33rd, but SIA’s SilkAir is way down at 62nd.

Pioneer of the modern budget model Ryanair is ranked 59th.

Down the slippery road of decline: Aisana Airlines and Etihad Airways

If it is difficult to stay at the top, it is easy to slip down the slippery road of decline. Asiana and Etihad are two examples.

Asiana was ranked world’s best airline in 2010 and became a familiar name in the top ten list up to 2014, after which its ranking kept falling: 11th (2015), 16th (2016), 20th (2017), 24th (2018) and 28th (2019). Its erstwhile glory has been whittled down to being just best cabin crew in South Korea.

Etihad did reasonably well for eight years until 2018 when it was ranked 15th, and a year later suffered a dramatic decline to the 29th spot. That, despite beating Qatar to be this year’s best first class in the Middle East.

As I stated at the onset that there are surveys and there are surveys. Some are not specifically targeted , whether its interest is business or leisure for example. There is always an element of subjectivity and bias in the composition and weightage, and this renders no one reading as being definitive. At best, we can read across several creditable surveys to know with some conviction how the airlines really measure against each other.

Read also:

More Boeing woes: Singapore Airlines grounds B787 jets

Courtesy Singapore Airlines

Singapore Airlines (SIA) has grounded two of its eight Boeing 787-10 jets which are found to have premature blade deterioration. The aircraft with an average age of only 1.11 years are fitted with Rolls-Royce Trent 1000 engines.

In truth this is not a new issue. Other airlines such as British Airways, Virgin Atlantic and Norwegian Air Shuttle have also grounded their affected aircraft. As of late February, Rolls-Royce said 35 787s across the industry were grounded due to engine blades corroding or cracking prematurely. It aimed to reduce the number to 10 by the end of the year.

While grounding an aircraft can be costly, airlines are not taking chances. In the present cliamte following the fatal crashes of two B737 Max 8 jets operated by Lion Air and Ethiopian Airways, the mood must be one of caution. Being open as SIA did, helps to reassure customers of the diligence the airline gives to its maintenance program.

A for Boeing, although the issue relates to the Rolls-Royce engine, it couldn’t have come at a worse time.

Virgin Atlantic faces strike action, reassures customers: What next?

While the UK Civil Aviation Authority is mulling over the issue of compensation for Ryanair passengers whose flights had been cancelled or delayed because of strike action by the carrier’s crew (Is strike action by airline crew an extraordinary circumstance? Dec 6, 2018), the Professional Pilots Union representing some Virgin Atlantic pilots announced a series of strike to take place from December 22 to Christmas Day, December 30 to January 2, and January 4 to 7.

Courtesy PA

Virgin Atlantic issued a statement to reassure its customers: “Our absolute priority is to ensure that all of our customers can continue their journeys as planned this Christmas, and we’re working hard to protect all of their trips.”

Well and good, some comfort there, but many if not all those customer who have booked to fly on those dates are likely to be already hit with anxiety because of the uncertainty of their flights. Even if they didn’t want to take the chance of having their plans disrupted, it may be too late to make alternative arrangements.

They probably would have more faith in Virgin Atlantic than Ryanair on the issue of compensation, but that’s likely to be the least of their immediate concerns. What they want most is the assurance that in the event the industrial action affects their flights, the airline has alternative arrangements in place to ensure that their holiday plans are not badly disrupted, as promised in its statement while noting a likely shortage of seats during the holiday season.

This harks back to Ryanair’s argument that strike action by its crew amounts to “extraordinary circumstances” and therefore it is not obliged to compensate passengers whose flights were cancelled or delayed. Does it hold water since industrial action may be anticipated? There again, time is a factor and recovery is limited, hence some form of compensation after the fact.

Ultimately, whatever the cause and circumstance (with the exception of the “act of God”), it is a case of non deliverance. And while the customer frets about the absence of customer service, the painful lesson in the end is how they will have to live with their choice of carrier, whatever they base that decision on.

Air New Zealand tops again

Courtesy Air New Zealand has named Air New Zealand as the world’s best airline for 2018. Other airlines that make the top ten in descending order are Qantas, Singapore Airlines (SIA), Virgin Australia, Virgin Atlantic, Etihad Airways, All Nippon Airways (ANA), Korean Air, Cathay Pacific and Japan Airlines.

According to the editorial team, airlines must achieve a seven-star safety rating (developed in consultation with the International Civil Aviation Organization) and demonstrate leadership in innovation for passenger comfort to be named in the top ten.

The evaluation team also looks at customer feedback on sites that include CN which perhaps explain little surprise in both AirlineRatings and Conde Nast Travel naming Air New Zealand as their favourite. (See What defines a best airline? Oct 19, 2017) Four airlines, namely SIA, Virgin Australia, Virgin Atlantic and Cathay Pacific are ranked in the top ten of both lists. These look like consistently global favourites.

Notable absences from the AirlineRatings list are Middle east carriers Qatar Airways and Emirates Airlines. While these airlines scored for service in other surveys, they may have lost the lead in product innovation for which most of the airlines ranked by AirlineRatings are commended. Virgin Australia’s new business class is said to be “turning heads” and Etihad is said to provide a “magnificent product throughout the cabins.” Looking ahead, Air New Zealand will feel the pressure from Qantas and SIA for the top spot. (See Singapore Airlines steps up to reclaim past glory, Nov 3, 2017) In the same survey, Qantas is selected for best lounges and best catering services, and SIA for best first class and best cabin crew.

For those who think best airline surveys are often skewed by the halo effect of service provided in the upper classes, AirlineRatings has named Korean Air as best economy airline.

What defines a best airline?

What defines a best airline, considering the different surveys that rank them? Conde Nast Travel has just released its readers’ choice of the best in 2017, and it is no surprise the list is made up of Asian, Middle East, European and SW Pacific carriers.

Courtesy Air New Zealand

Of course, it depends on the readership, but recognizing that, it also points to what really makes these airlines stand out. It is clear that the premium class service weighs heavily – the seat comfort and the fine food.

Etihad Airways (ranked #16) offers “the future of first-class comfort: a three-room “residence” with a bedroom, private bath with shower, and lounge.” Emirates (#4) offers “posh perks for premium fliers – cocktail lounges, in-flight showers… part of the reason it scores so high among travellers.” And the suites on Singapore Airlines (#3) offer “a pair of fully flat recliners that can be combined into a double bed.”

Mention is made of the premium economy class in almost all the ranked airlines” KLM (#20), Lufthansa (#19), Japan Airlines (#17), All Nippon Airways (#13), Qantas (#12), Cathay Pacific (#10), Virgin Atlantic (#7), Virgin Australia (#6), Singapore Airlines (#3) and Air New Zealand (#1).

So it may appear to be the voice of the premium travellers that is being heard. Maybe coach travellers aren’t too concerned about the ranking, more driven by price and less frilly factors, although to be fair, the Conde Nast report did mention of at least one airline, i.e. Etihad Airways (#16), not ignoring “those sitting in the back.” While many travellers may resign to the belief that the economy class is about the same across the industry, it is reasonable to assume that an airline that strives to please its customers in the front cabins will most probably carry that culture or at least part of it to the rear.

Although you may draw consensus across many of the surveys, it is best best to treat each one of them in isolation. It is more meaningful to try and draw intra conclusions within the findings of the particular survey.

You will note in the Conde Nast findings, there is an absence of American (including Canadian) carriers, never mind that of African and South American carriers.

Asiana Airlines (#8) is ranked ahead of Korean Air (#11).

All Nippon Airways (#13) is ranked ahead of Japan Airlines (#17). V

Virgin Australia (#6) is ranked ahead of Qantas (#12).

The order of the “Big 3” Gulf carriers is as follows: Qatar Airways (#2), Emirates (#4) and Etihad Airways (#16).

Of European carriers, there is the conspicuous absence of the big names of British Airways (compare Virgin Atlantic #7) and Air France, and the pleasant surprise of Aegean Airlines (#9) while SWISS seems to be regaining its erstwhile status years ago as being the industry standard.

The best belongs to Air New Zealand as the quiet achiever.

Ultimately, the results also depend on the group of respondents whose experiences may be limited to certain airlines.

Other airlines ranked in the top 20 of the Conde Nast survey: Finnair (#14), Turkish Airlines (#15), EVA Air (#18).

Air New Zealand leads the pack

Courtesy Air New Zealand

Courtesy Air New Zealand

Air New Zealand is the world’s best airline according to based on criteria that include fleet age, safety, profitability and leadership in innovation for passenger comfort. The agency’s Airline Excellence Awards program which lists the winning airlines is endorsed by the International Civil Aviation Organization.

Many travellers would recognize ANZ for its attention-grabbing in-flight safety video that takes them into Middle Earth, the kind of out-of-the-aircraft features that a few other airlines have tried to imitate but fared only poorly. Editor-in-Chief Geoffrey Thomas said: “Air New Zealand came out number one in virtually all of our audit criteria, which is an exceptional performance.” The airline was favoured for its record-breaking financial performance, award-winning in-flight innovations, operational safety, environmental leadership and motivation of its staff.

Skycouch: Picture courtesy Air New Zealand

Skycouch: Picture courtesy Air New Zealand

But, of course, there are surveys and there are surveys that publish their own lists of favourites. Some airlines such as Singapore Airlines (SIA) and Cathay Pacific have a ubiquitous presence, and there also notable absences. This is where it is most telling, bearing in mind that the ranking is dependent on several factors such as the excellence-defining criteria and the population surveyed.

The other nine airlines ranked behind ANZ in the top ten list by are in descending order: Qantas, SIA, Cathay, Virgin Atlantic, British Airways (BA), Etihad, All Nippon Airways, EVA Air and Lufthansa.

It is interesting to note that the top two airlines come from the remote Southwest Pacific. Qantas has in recent years been working on upgrading its product offerings, winning accolades for catering and airport lounges. Not surprisingly, innovation along with good service seem to be the driving winning streak going down the list – SIA and Cathay for their premium economy and revamped business classes, Virgin for its cabin ambience and friendly crew, BA for its leadership in in-flight entertainment, and Etihad for its equally impressive service in front and at the back of the aircraft.

Notable absences in the list are US carriers (no surprise there) and two of the big three Middle-East carriers (Emirates and Qatar).

Many survey rankings are skewed by the weight they place on service in the premium classes. However, Mr Thomas of said: “We are looking for leadership and airlines that innovate to make a real difference to the passenger experience particularly in economy class.” Considering that the majority of travellers are seated in coach, it is time that airlines crowned with the halo of excellence pay more attention at the back of the aircraft, for this may well make the difference as the competition intensifies. And, it is where the differentiation becomes even more challenging. Perhaps too, this could be the reason why Emirates and Qatar, known for their lavish premium service, did not make it to the top ten of the list.

Another Virgin on the rocks

Courtesy Virgin Australia

Courtesy Virgin Australia

THE name Virgin is ringing in the air. Following on the heels of Alaska Airlines paying US$2.6 billion for Virgin America, wrenching the bid from rival JetBlue Airways, Singapore Airlines (SIA) announced it has increased its stake in Virgin Australia form 22.91 per cent to 23.11 per cent at a cost of A$3.18 million (US$2.39 million). SIA has approval from Australia’s Foreign Investment Review Board to increase its stake to 25.9 per cent.

Air New Zealand, the largest shareholder of Virgin Australia with a stake of 25.89 per cent, said it was considering an exit to focus on other growth areas. If SIA takes up its full allotment, it will be a larger partner than Etihad Airways, which owns about 24 per cent of the Australian carrier. The Virgin Group holds only a stake of about 10 per cent. There is speculation that SIA is poised to go higher, subject to approval from the relevant Australian authorities.

History repeats itself. SIA’s relationship with the Virgin Group goes as far back as 1999 when the Singapore carrier made headline news buying 49 per cent of Virgin Atlantic at a cost of £600m (US$844 million). What then appeared to be a coup turned out not be a lemon, which after years of lacklustre performance, was sold to Delta Airlines at a hefty loss in 2014 for £224m.

Yet the circumstances today might be a little different. SIA feels more pressured to secure its Australian market against national carrier Qantas. Together with the other partners, SIA is a contributor to an A$425 million loan to Virgin Australia to keep it above waters. While Virgin’s trans-Pacific flights to the US would accomplish a dream long in the making for SIA, it is not as imperative as it was then when it had hoped Virgin Atlantic would augment its trans-Atlantic foray into the US east coast. It could be worse if Air New Zealand’s stake in the Australian carrier falls into the hands of competing rivals that may threaten SIA’s wider market beyond Australia.

SIA paid dearly for the increases take in Virgin Australia at 46.72 cents per share which is well above the current price of 35.5 cents. So it is said that Alaska Airlines too paid a high price to take over Virgin America, which will enlarge Alaska’s west coast market and give it access to the east coast. Virgin chief Richard Branson proudly admitted: “They paid a high price for a great brand.” Indeed, Virgin America, voted consistently as the country’s best airlines in the past four years, could add to Alaska which itself is known for providing consistently good service at reasonable fares. Somehow Virgin Australia has tried hard but with not as much success as expected to bite off Qantas’ 80 per cent market share. How much more can SIA contribute, noting the struggle of erstwhile Tigerair Australia?

SIA and Virgin are reputable brand names. While there is a chance that they can build on each other’s strength, there is no guarantee that the chemistry will work twice as well.