Wirraway
9th Apr 2004, 15:22
Sat "Melbourne Age"
Qantas 'will do right thing' on Burma
By Mark Baker
Asia Editor
Singapore
April 10, 2004
Qantas has defended its partnership in a new Asian budget airline with two prominent Singapore businessmen who have close commercial ties to Burma's military regime.
One partner this week left open the possibility of the Singapore-based airline flying to Burma - despite an international boycott on tourism and investment called by detained opposition leader Aung San Suu Kyi.
Qantas chief Geoff Dixon, while refusing to disclose which routes were being considered, later insisted that he and his partners would "do the right thing" in response to the Burma boycott.
"If they are discouraging tourism and all the rest of it, it's probably very unlikely we'd want to fly there," Mr Dixon said.
The new airline - likely to be called Jetstar Asia - plans to begin flying this year to budget tourist destinations within a five-hour radius of Singapore. The airline aims to have 20 planes within three years.
Qantas will have a 49.9 per cent stake in the $S100 million ($A78.3 million) start-up and will initially hold chairmanship of a six-member board.
Leading Singapore businessmen Wong Fong Fui and Tony Chew have taken a 31.1 per cent stake in the new company, with the balance of the shareholding held by Temasek Holdings, which is the Singapore Government's powerful investment arm.
Mr Wong was managing director of Burma's privatised national airline, Myanmar Airways International, for seven years up to 1998. Mr Chew is a member of the Myanmar Business Group, an association of Singapore businessmen with interests in Burma.
Asked whether his strong business ties in Burma and Vietnam made them likely destinations for the new airline, Mr Chew said: "I think every destination is potential."
Mr Dixon said the airline was studying potential routes, but said he could not be specific until Singapore's Transport Ministry had granted approval.
Pressed on whether Qantas was swayed by calls from Ms Suu Kyi and her National League for Democracy for tourists and businessmen to stay away from Burma until democracy was restored, Mr Dixon appeared unsure about the boycott, which has strong international support.
"Are you saying a social issue, a conscience issue or a commercial issue?" he said, in response to a question from The Age.
"I'm quite sure all the shareholders would take in political issues, they'll take in social issues and they'll take in commercial issues.
"I think you can rest assured... that we'll make the right decision when it comes to things like that."
Mr Dixon said Qantas had "a track record around the world for doing, basically, the right thing".
========================================
Sat "The Straits Times" (Singapore)
EDITORIAL
Air industry evolving
SINGAPORE's embrace of the budget airline business has been breathtaking, considering it is the home of the world's most consistently dependable premium airline.
This week, Qantas received a more or less official welcome to start yet another discount service here, as the Australian carrier's main partner is Temasek Holdings. Temasek also has a stake in Tiger Airways headlined by Singapore Airlines and the Irish budget carrier Ryanair.
Thus far, four discount airlines have planted their colours here. Malaysia's AirAsia set something of a template, flying people to Bangkok one-way from Changi at $60 promotional fares. Did any airline executive anticipate this coming to the Asian land mass?
The industry is slowly conceding these are evolutionary steps of adapting to the environment. Full-service carriers in Europe and the United States are merging, paring operating costs or going out of business in the face of competition from cheeky fare discounters like Ryanair and Southwest Airlines. Whether the evolutionary change that has gone on in that part of the world for a decade could be repeated in Asia to the same degree is hard to forecast. Operating conditions in Asia are different, industry experts never fail to point out. They mean difficult. Europe's skies are largely fair game for the ablest in sewing up deals, whereas America is a continental market unto itself.
But if industry watchers would project their scenario-making boldly, do they see in the foreseeable future a shakeout in the Asian air industry much like what food and general merchandising had undergone in consumer societies? Meaning, mass merchandisers capture volume to rule the roost, leaving pricey boutique establishments to cater to a dwindling, select clientele. This is where Singapore's operating creed of joining the competition, not ducking by putting up barriers to keep out rivals, should be emulated by every government in Asia and Australasia.
Budget carriers, no less than regular airlines, will face the same obstacles of regulated skies when they do their route planning. Under-capitalised discount carriers flying out of Changi would not be able to sustain more than several years of losses if they do not have a minimum range of operating rights to land in, say, Vietnam, the Philippines, Myanmar, India, Thailand and southern China. It is fortuitous that the budget business has a ripple effect in that more of these countries are themselves seeing the benefits of having their own low-fare services. Then, it behoves all countries to collaborate.
The Singapore Government's non-discriminatory approach to civil aviation, now extended to discounters, could, if replicated by other governments, help bring about a golden age in Asian travel. The International Tourism Organisation and the International Air Transport Association see Asia as the next mass-travel tourism market. Travel within China itself by the Chinese has been setting records. If the travel trade in Asia is quick to hook up with discount airlines in the manner they have traditionally done business with scheduled carriers, the sky is no limit.
Indonesian domestic discount travel is a revealing study. After deregulation in 1999, a plunge in fares brought 25 carriers into the fray. People could fly Lion Air between Jakarta and Makassar, 1,800km away in Sulawesi, for US$50 (S$84) against the old fare of US$300. It is little wonder there has been a travel boom within Indonesia: 12 million domestic fliers in 2002, 17.5 million last year, a projected 20 million plus this year. Indonesia is only a microcosm of the Asia that can be in the multiplier effect.
==========================================
Qantas 'will do right thing' on Burma
By Mark Baker
Asia Editor
Singapore
April 10, 2004
Qantas has defended its partnership in a new Asian budget airline with two prominent Singapore businessmen who have close commercial ties to Burma's military regime.
One partner this week left open the possibility of the Singapore-based airline flying to Burma - despite an international boycott on tourism and investment called by detained opposition leader Aung San Suu Kyi.
Qantas chief Geoff Dixon, while refusing to disclose which routes were being considered, later insisted that he and his partners would "do the right thing" in response to the Burma boycott.
"If they are discouraging tourism and all the rest of it, it's probably very unlikely we'd want to fly there," Mr Dixon said.
The new airline - likely to be called Jetstar Asia - plans to begin flying this year to budget tourist destinations within a five-hour radius of Singapore. The airline aims to have 20 planes within three years.
Qantas will have a 49.9 per cent stake in the $S100 million ($A78.3 million) start-up and will initially hold chairmanship of a six-member board.
Leading Singapore businessmen Wong Fong Fui and Tony Chew have taken a 31.1 per cent stake in the new company, with the balance of the shareholding held by Temasek Holdings, which is the Singapore Government's powerful investment arm.
Mr Wong was managing director of Burma's privatised national airline, Myanmar Airways International, for seven years up to 1998. Mr Chew is a member of the Myanmar Business Group, an association of Singapore businessmen with interests in Burma.
Asked whether his strong business ties in Burma and Vietnam made them likely destinations for the new airline, Mr Chew said: "I think every destination is potential."
Mr Dixon said the airline was studying potential routes, but said he could not be specific until Singapore's Transport Ministry had granted approval.
Pressed on whether Qantas was swayed by calls from Ms Suu Kyi and her National League for Democracy for tourists and businessmen to stay away from Burma until democracy was restored, Mr Dixon appeared unsure about the boycott, which has strong international support.
"Are you saying a social issue, a conscience issue or a commercial issue?" he said, in response to a question from The Age.
"I'm quite sure all the shareholders would take in political issues, they'll take in social issues and they'll take in commercial issues.
"I think you can rest assured... that we'll make the right decision when it comes to things like that."
Mr Dixon said Qantas had "a track record around the world for doing, basically, the right thing".
========================================
Sat "The Straits Times" (Singapore)
EDITORIAL
Air industry evolving
SINGAPORE's embrace of the budget airline business has been breathtaking, considering it is the home of the world's most consistently dependable premium airline.
This week, Qantas received a more or less official welcome to start yet another discount service here, as the Australian carrier's main partner is Temasek Holdings. Temasek also has a stake in Tiger Airways headlined by Singapore Airlines and the Irish budget carrier Ryanair.
Thus far, four discount airlines have planted their colours here. Malaysia's AirAsia set something of a template, flying people to Bangkok one-way from Changi at $60 promotional fares. Did any airline executive anticipate this coming to the Asian land mass?
The industry is slowly conceding these are evolutionary steps of adapting to the environment. Full-service carriers in Europe and the United States are merging, paring operating costs or going out of business in the face of competition from cheeky fare discounters like Ryanair and Southwest Airlines. Whether the evolutionary change that has gone on in that part of the world for a decade could be repeated in Asia to the same degree is hard to forecast. Operating conditions in Asia are different, industry experts never fail to point out. They mean difficult. Europe's skies are largely fair game for the ablest in sewing up deals, whereas America is a continental market unto itself.
But if industry watchers would project their scenario-making boldly, do they see in the foreseeable future a shakeout in the Asian air industry much like what food and general merchandising had undergone in consumer societies? Meaning, mass merchandisers capture volume to rule the roost, leaving pricey boutique establishments to cater to a dwindling, select clientele. This is where Singapore's operating creed of joining the competition, not ducking by putting up barriers to keep out rivals, should be emulated by every government in Asia and Australasia.
Budget carriers, no less than regular airlines, will face the same obstacles of regulated skies when they do their route planning. Under-capitalised discount carriers flying out of Changi would not be able to sustain more than several years of losses if they do not have a minimum range of operating rights to land in, say, Vietnam, the Philippines, Myanmar, India, Thailand and southern China. It is fortuitous that the budget business has a ripple effect in that more of these countries are themselves seeing the benefits of having their own low-fare services. Then, it behoves all countries to collaborate.
The Singapore Government's non-discriminatory approach to civil aviation, now extended to discounters, could, if replicated by other governments, help bring about a golden age in Asian travel. The International Tourism Organisation and the International Air Transport Association see Asia as the next mass-travel tourism market. Travel within China itself by the Chinese has been setting records. If the travel trade in Asia is quick to hook up with discount airlines in the manner they have traditionally done business with scheduled carriers, the sky is no limit.
Indonesian domestic discount travel is a revealing study. After deregulation in 1999, a plunge in fares brought 25 carriers into the fray. People could fly Lion Air between Jakarta and Makassar, 1,800km away in Sulawesi, for US$50 (S$84) against the old fare of US$300. It is little wonder there has been a travel boom within Indonesia: 12 million domestic fliers in 2002, 17.5 million last year, a projected 20 million plus this year. Indonesia is only a microcosm of the Asia that can be in the multiplier effect.
==========================================