Singapore Airlines (SIA) Group is planning to transfer some aircraft from its regional full service subsidiary SilkAir fleet to low-cost airline Scoot in conjunction with the group’s ongoing strategic review.
According to a report by the Centre for Asia Pacific Aviation (CAPA) on Thursday (Jun 21), several Boeing 737-800s intended for transfer will be retrofitted to high-density all-economy configuration before entering official service with Scoot.
The narrow-body aircraft currently have both business and economy class cabins.
Transferring and modifying the planes would enable SIA Group to reduce unit costs and compete more effectively on short-haul routes that are being served by SilkAir, wrote CAPA.
Route transfers have also been on the group’s list of measures to cut costs and improve profitability. Since late 2017, five routes have been transferred from SilkAir to Scoot and several more over the next year are being planned.
CAPA highlighted that in 2012, SIA Group over-ordered 54 Boeing 737s for SilkAir and Scoot had just launched operations as a fully wide-body fleet operator. The latter had not merged with fellow budget airline TigerAir at the time.
Considering Scoot has since taken over more flight routes, the report described the rebalancing of the group’s narrow-body fleet as “inevitable”.
The transfer plans followed an earlier SIA announcement in May about the airline’s multi-year programme that will involve investments of over S$100 million ($74 million) to upgrade SilkAir’s cabins as part of a major overhaul ahead of a merger between the two.
The move, said SIA, would ensure closer product and service consistency across the airline group’s full-service network.