Singapore Airlines, Rex in talks
From correspondents in Singapore
September 07, 2002
SINGAPORE Airlines (SIA) is in talks with an Australian domestic airline, a Singapore report said today.
The report has fuelled speculation that the Singapore carrier is actively seeking a slice of Australian domestic travel.
Discussions on an "interline" agreement with SIA began about a fortnight ago, Armon Hicks, a spokesman for Australia's newest airline Regional Express (Rex), told the Straits Times.
The deal, if it goes through, would allow passengers landing at any of the five Australian cities now served by SIA to go on to 31 other destinations in the country without having to check in their bags again or make separate bookings.
An SIA spokesman treated the latest talk of an Australian venture the same as recent market rumours, saying the airline will "rule nothing in or out. We are leaving our options open with regards to the Australian domestic market".
Among various market rumours has been a suggestion that SIA was considering a proposal to revive Australia's collapsed Ansett airline.
Sydney Airports Corp Ltd spokesman Peter Gibbs told reporters that an SIA evaluation team had inspected the former Ansett terminal at Sydney Airport.
But Ansett lawyer Leon Zwier said this week there had been no discussion with Singapore Airlines.
"We're not sitting down to talks ... we're not doing deals with Ansett names or parts, although if they want to talk to us they would be welcome."
Ansett provided a feeder service for SIA passengers before its sensational collapse last year.
Since Ansett's demise, the Star Alliance group of airlines, including SIA, has lacked a presence in the Australian domestic market, which analysts estimate is costing the Singapore operation hundreds of millions of dollars a year.
Analysts have put the total value of the Australian domestic airline market at nearly 10 billion Singapore dollars ($A10.6 billion).
Qantas has now picked up about 80 per cent of the Australian domestic market, with British tycoon Richard Branson's cut-price carrier Virgin Blue picking up the remainder.
Aviation analysts say that even if SIA seals an agreement with Rex it would not fill the vacuum left by Ansett, as Rex has only two per cent of the market and does not fly key routes such as Melbourne-Sydney.
Rex spokesman Hicks said the new carrier was also in talks with both Qantas and Virgin Blue.