Singapore Airlines has detailed its plans to launch a budget long-haul carrier next year in a move that will mean new competition for Qantas owned Jetstar.
The unusually-named new airline, called ‘Scoot,’ is slated to launch in mid-2012 with a fleet of four Boeing 777-200s transferred from Singapore Airlines’ fleet. Scoot will initially focus on routes in Australasia and China with plans to expand into India, Europe and North America. Fares will be as much as 40 per cent below premium airlines, with amenities such as meals, baggage and inflight entertainment costing extra.
The move by Singapore Airlines is seen as a belated response to growing pressure from budget operators like AirAsia and Jetstar, which have taken over a growing portion of the air travel market in recent years. Like Jetstar and AirAsiaX, Scoot would be one of the few budget carriers to operate longer routes.
Scoot also represents a major marketing departure from Singapore Airlines’ traditionally staid image. In a news release, Scoot CEO Campbell Wilson said the new airline’s unconventional name “conveys spontaneity, movement, informality and a touch of quirkiness — all attributes we intend this company to be known for.”
But what Wilson referred to as the new company’s “Scootitude” has already come in for a fair bit of online ridicule, with AirAsia boss Tony Fernandes tweeting that Singapore Airlines “has no creativity” and is “a confused puppy as an airline.”
In addition to its well-regarded flagship brand, Singapore Airlines already operates SilkAir, a mid-cost regional carrier, and owns a 33 per cent stake in the budget operator Tiger Airways. Analysts say the new airline could cannibalise some business from Singapore Airlines’ other carriers but that it is important for the company to establish itself in the growing budget sector.
Singapore Airlines “joined the short-haul low-cost party too late,” the CAPA Centre for Aviation wrote Wednesday in an analysis of the Scoot launch. “The long-haul low-cost trend, however, has just begun, making SIA’s bet with Scoot risky but potentially more rewarding. Other carriers throughout Asia and the world will be closely monitoring Scoot’s developments.”
