Singapore airlines warns of Crisis
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Singapore airlines warns of Crisis
Singapore Airlines Warns Of Crisis; To Cut Costs
By Shen Hong
Of DOW JONES NEWSWIRES
SINGAPORE (Dow Jones)--Echoing the dire straits plaguing other major global airlines, Singapore Airlines (Singapore: SIAL.SI - news) Ltd. (P.SAL) Thursday warned that it's entering the most difficult period in its history.
Painting a gloomy picture for its near-term outlook, SIA said it's reviewing its operations and will implement a series of painful cost-saving measures. Although not surprised by the news, analysts say the already-battered stock may not be able to avoid further selloffs Friday.
In one of the airline's most strongly worded statements, SIA's Deputy Chairman and Chief Executive Cheong Choong Kong told the airline's staff that the current woes are just the beginning and that they must prepare for the worst.
"This is an important message and an unhappy one," Cheong said. "The pain is only just starting; nobody dares predict when or how it will end."
While high fuel costs and poor economic conditions have made life tough for SIA in the past 12 months, "the immediate future confronting commercial aviation is far more serious," Cheong said.
Air traffic, particularly to the U.S., has declined in the wake of the terrorist attacks in New York and Washington, adding that costs are rising, particularly those of fuel and insurance.
The situation will worsen if the U.S. launches military strikes which could trigger terrorist reprisals, he said.
In order to cope with the difficulties, SIA will adjust capacity to match demand and will trim budgeted growth, "even if it means lower aircraft utilization," Cheong said.
In addition, all planned expenditure, except the essential, will be deferred, slowed down or canceled, "including capital expenditures on projects dear to us," he said.
Staff recruitment will cease, except in one or two areas, he said.
"Many airlines are starting to retrench large numbers of staff. We ourselves may not be able to avoid retrenchments, but we will look at other cost-reducing measures first," he said.
While employees and unions may be called upon to make sacrifices, Cheong said that when needed, SIA's senior management will take the lead. - - 20/09/01 11-41G
By Shen Hong
Of DOW JONES NEWSWIRES
SINGAPORE (Dow Jones)--Echoing the dire straits plaguing other major global airlines, Singapore Airlines (Singapore: SIAL.SI - news) Ltd. (P.SAL) Thursday warned that it's entering the most difficult period in its history.
Painting a gloomy picture for its near-term outlook, SIA said it's reviewing its operations and will implement a series of painful cost-saving measures. Although not surprised by the news, analysts say the already-battered stock may not be able to avoid further selloffs Friday.
In one of the airline's most strongly worded statements, SIA's Deputy Chairman and Chief Executive Cheong Choong Kong told the airline's staff that the current woes are just the beginning and that they must prepare for the worst.
"This is an important message and an unhappy one," Cheong said. "The pain is only just starting; nobody dares predict when or how it will end."
While high fuel costs and poor economic conditions have made life tough for SIA in the past 12 months, "the immediate future confronting commercial aviation is far more serious," Cheong said.
Air traffic, particularly to the U.S., has declined in the wake of the terrorist attacks in New York and Washington, adding that costs are rising, particularly those of fuel and insurance.
The situation will worsen if the U.S. launches military strikes which could trigger terrorist reprisals, he said.
In order to cope with the difficulties, SIA will adjust capacity to match demand and will trim budgeted growth, "even if it means lower aircraft utilization," Cheong said.
In addition, all planned expenditure, except the essential, will be deferred, slowed down or canceled, "including capital expenditures on projects dear to us," he said.
Staff recruitment will cease, except in one or two areas, he said.
"Many airlines are starting to retrench large numbers of staff. We ourselves may not be able to avoid retrenchments, but we will look at other cost-reducing measures first," he said.
While employees and unions may be called upon to make sacrifices, Cheong said that when needed, SIA's senior management will take the lead. - - 20/09/01 11-41G
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They are still advertising for pilots in the UK is this one of the 1 or 2 areas that there will be continued recruitment??
I would have thought they could offer the poor people at VS positions if they still have a requirement. However, with their involvement in VS/Ansett I bet they have some very complex sums to do.
It would appear to me that the longer the period of uncertainty goes on i.e. the wait for retaliation the worse this situation will get.
I would have thought they could offer the poor people at VS positions if they still have a requirement. However, with their involvement in VS/Ansett I bet they have some very complex sums to do.
It would appear to me that the longer the period of uncertainty goes on i.e. the wait for retaliation the worse this situation will get.
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Unfortunately, the above does not stop SIA or the Singapore governement of going with the ususal hype and public relations that they feel is necessary with SIA.
Sadly and pathetically, for Friday Sept. 21, 2001 page W1 of the World Business section of the NEW YORK TIMES the following article: "Singapore's Line, Debt Free, Is in Relatively Good Shape." This reminds me of the hype that was everyday when I lived in Singapore such as everyday articles in the STRAIT TIMES: "SIA Flying High".
The bull and rendition will always be there for they will speak out of both sides of the mouth. The preception must be in the world that SIA is always doing well no matter what the circumstances for we are the master race.
This may sound harsch but its the truth.
Sadly and pathetically, for Friday Sept. 21, 2001 page W1 of the World Business section of the NEW YORK TIMES the following article: "Singapore's Line, Debt Free, Is in Relatively Good Shape." This reminds me of the hype that was everyday when I lived in Singapore such as everyday articles in the STRAIT TIMES: "SIA Flying High".
The bull and rendition will always be there for they will speak out of both sides of the mouth. The preception must be in the world that SIA is always doing well no matter what the circumstances for we are the master race.
This may sound harsch but its the truth.
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Have to agree there NYP. Every time theres an economic f@rt SIA takes the advantage and starts chopping salarys as an excuse to increase profits, or at least sustain profits at previous levels. This usualy starts off with cutting cabin crew overnight alowances, next its tech crew contract salary manipulation, and finaly a declaration of "No Bonus" until the ground staff (catering etc) express there displeasure in the only way they can, then management offers a 1 week bonus.
SIA have cried wolf so many times in the past who is going to believe them now? I dont.
SIA have cried wolf so many times in the past who is going to believe them now? I dont.
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A word of caution for those sending in their cv to SIA in these troubled times. Years ago, I too was an unemployed pilot. The gulf war had finished, and opportunities were few. Ah, but SIA were still running ads for pilots on local terms, no airline experience necessary. Great, so after the required formalities, it was off to South East Asia with a big smile on my face.
Its hard to appreciate from the outside just how vicious and oppressive a regime Singapore and its airline actually are.Their conduct is very gentlemanly and even westernized prior to signing your required bond. Of course once you start, their true colors shine through. The bond is their carte blanch, and your presence in their country a confirmation that you accept their way of thinking. Flexibility and understanding are zero. Learn to swim, of you're surly suffer their self imposed drip drip style of attrition, to make you accept their ways.
Ask yourself if you can accept a totally different corporate culture than what you have been used to in the past. Gone are the knowing smiles of familiarity from the girls in the office, in the departure hall, in despatch. The facade of the Singapore Girl will fade as quickly of the memories of what it was like to work for a "real" airline. Make no mistake about it, you are but a contractor, despised by many in the training department, a newcomer, to be metaphorically beaten into submission.
Troubled times usually benefit SIA.Crews are plentiful, and they can behave in their usual rude and belligerent way , knowing that any port in a storm attitudes will prevail. And here is the underlying problem with the majority of expats in Singapore Airlines. They are there out of necessity, rather than choice. Few are those pilots who chose to leave their current employer for SIA. Usually the common prevailing factor in SIA's expat crews is necessity to maintain an income. Other factors are overlooked in favor of this outstanding requirement.And yes, I too was no different, I went to Singapore because I was unable to get a flying job in my home country.And I was keen and wanted the best. But Im not there now, and shudder to think of the way they treated me and my colleagues, who were there to start what we hoped would be a long and rewarding career.Take the job if nothing else is avaliable, but do it with your eyes wide open.As Tom Waits says, "were all off to Singapore,Singapore land of Nod"
Its hard to appreciate from the outside just how vicious and oppressive a regime Singapore and its airline actually are.Their conduct is very gentlemanly and even westernized prior to signing your required bond. Of course once you start, their true colors shine through. The bond is their carte blanch, and your presence in their country a confirmation that you accept their way of thinking. Flexibility and understanding are zero. Learn to swim, of you're surly suffer their self imposed drip drip style of attrition, to make you accept their ways.
Ask yourself if you can accept a totally different corporate culture than what you have been used to in the past. Gone are the knowing smiles of familiarity from the girls in the office, in the departure hall, in despatch. The facade of the Singapore Girl will fade as quickly of the memories of what it was like to work for a "real" airline. Make no mistake about it, you are but a contractor, despised by many in the training department, a newcomer, to be metaphorically beaten into submission.
Troubled times usually benefit SIA.Crews are plentiful, and they can behave in their usual rude and belligerent way , knowing that any port in a storm attitudes will prevail. And here is the underlying problem with the majority of expats in Singapore Airlines. They are there out of necessity, rather than choice. Few are those pilots who chose to leave their current employer for SIA. Usually the common prevailing factor in SIA's expat crews is necessity to maintain an income. Other factors are overlooked in favor of this outstanding requirement.And yes, I too was no different, I went to Singapore because I was unable to get a flying job in my home country.And I was keen and wanted the best. But Im not there now, and shudder to think of the way they treated me and my colleagues, who were there to start what we hoped would be a long and rewarding career.Take the job if nothing else is avaliable, but do it with your eyes wide open.As Tom Waits says, "were all off to Singapore,Singapore land of Nod"
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Many months ago I suggested that the 49% investment in Vigin Atlantic was a complete waste of money and that was prior to WTC which now makes this investment worthless.I think Dr Cheong was so fascinated by Richard Branson that he would have paid anything he was asked,likewise the 25% investment in Air New Zealand is also worthless.
Swissair have shown that minority stakes in other Airlines is not profitable and Cathay's CEO has been quoted as saying that buying minority stakes in other Airlines is not a good use of capital. Heads should roll at the very top of SIA for this and as someone else has mentioned we the Pilots will be the ones who are asked to make sacrifices for the almost 2Billion SGD that has been totally wasted.It is a National Scandal!!
Swissair have shown that minority stakes in other Airlines is not profitable and Cathay's CEO has been quoted as saying that buying minority stakes in other Airlines is not a good use of capital. Heads should roll at the very top of SIA for this and as someone else has mentioned we the Pilots will be the ones who are asked to make sacrifices for the almost 2Billion SGD that has been totally wasted.It is a National Scandal!!
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Oh how the high and mighty can fall. Failed ham fisted attempts by SIA to buy into Qantas, China Airlines, Thai, Tata all came to nothing. Their "successful" attempts are now the albatross of financial burden. It will be interesting to see SIA's real commitment to those companies it has invested in. Hopefully, they are not just another designer lable to adorn SIA's mantle, to be discarded when not in vogue.A realistic reflection of Singaporean materialistic society in general.
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Well said Thegypsy - at the current price (NZ$0.35) Air NZ shares are mighty cheap. When SIA wanted to buy more than the 50% that they are allowed to (and the Kiwi government said no) the price was NZ$1.30 per share. They renaged on this deal (ungentlemanly conduct??) - if the price had gone up would the board of Air NZ asked for more? As it is they have caused turmoil here and this has led to (at least in part) to the collapse of Ansett.
You could say - keep all your eggs in one basket, because spreading your investments like this is just causing havoc worldwide.
Interestingly, on a recent documentary here, the Ozzie government, who refused SIA permission to take over Ansett, and refused Air NZ the right to fly internally in Aus (like QA do here on a limited basis), were blamed as being the perpretators of the demise of Air NZ and Ansett, and SIA as saviours. The Aus govt. was seen as protecting QANTAS
You could say - keep all your eggs in one basket, because spreading your investments like this is just causing havoc worldwide.
Interestingly, on a recent documentary here, the Ozzie government, who refused SIA permission to take over Ansett, and refused Air NZ the right to fly internally in Aus (like QA do here on a limited basis), were blamed as being the perpretators of the demise of Air NZ and Ansett, and SIA as saviours. The Aus govt. was seen as protecting QANTAS
