No frills airlines may fly to Changi

Friday, 04 Jul, 2003 0

Singapore is opening Changi airport to foreign, low-cost airlines in a bid to fight off competition from Malaysian expansion at Senai, according to the Financial Times.

Singapore Airlines (SIA) may get its own “no frills” carrier. Former SIA boss Lim Chin Beng heads a business group setting up ValuAir, a low-cost airline that could be based either at Changi or Seletar, Singapore’s alternative airport favoured by executive jets.

But the runways are also open to overseas companies, and there’s speculation that Virgin Blue, Sir Richard Branson’s Australian-based budget airline, may expand its regional network to the island.

An extra encouragement to take up the offer could be the offer of bargain flight to London, Bangkok and Hong Kong, Singapore’s transport minister Mr Yeo Cheow Tong told Singapore’s Channel News Asia, as Singapore has spare air-traffic right to these destinations.

“We will be supportive of a budget airline at Changi. It does not have to be part of SIA, it can be someone else,” Mr Yeo, told the Financial Times.

His comments reflect Singapore’s keenness to stand up to the challenge posed by plans from Air Asia, Malaysia’s budget airline, to use Senai as a hub airport and bus passengers into Singapore.

Mr Yeo said it would be feasible for a low-cost airline to be based at Changi because Changi’s policy was to waive landing charges for new airlines for the first two years, and then to adjust fees by aircraft size.

The airport, which is currently open only to full-service airlines and is Asia third busiest after Hong Kong and Bangkok, handled 29m passengers in 2002.

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