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Thursday, 27 July 2017

Confident SIA will be very profitable again

Having Scoot and Tiger Airlines operating as some sort of budget carriers make a lot of sense in these days of fierce competition. Incidentally, Scoot and Tiger has become one airline two days ago (25 July). The two airlines operate under a single brand, Scoot. SIA also has Silkair another low cost regional airline. SIA will still be the premium airline.
Scoot and Silkair will compete with the other budget airlines like Jetstar, AirAsia etc while SIA will take care of the Middle Eastern Airlines like Emirates, Qatar etc. Competition means cutting fares and fill up as many seats as possible.
Rising staff cost and fuel prices can also drag airlines profits down but if SIA can contain the two, together with Scoot and Silkair, it will be very profitable again.
I don't see SIA going into the red for 2017. My guess is, it should make a profit of between S$500 million and $700 million.

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