"Singapore Airlines CEO says aviation industry is due for consolidation"

Sunday, July 10, 2005

Singapore Airlines CEO says aviation industry is due for consolidation
The Associated Press


SYDNEY (AP) -- Singapore Airlines chief executive Chew Choon Seng said
Sunday the global airline industry needs to consolidate as soaring oil
prices damage profits. 

He noted Singapore Airlines and Qantas are discussing sharing maintenance
operations for the new Airbus 380 super jumbo, which both carriers plan to
fly. 

"It makes sense that neither of us duplicate facilities but rather put our
heads together and see where we can have joint efforts and share facilities
and thereby spread costs," Chew told the Nine Network's Business Sunday
program. 

Singapore's transport minister, Yeo Cheow Tong, told the program that a
merger between Singapore Airlines and Qantas Airways remains unlikely under
present regulatory conditions. 

"I don't see the two airlines agreeing to a merger at this point of time
because there are many, many issues to be discussed," Yeo said. 

Last month, Qantas CEO Geoff Dixon said the carrier likely would form an
alliance with an overseas carrier in the future, and named Singapore
Airlines among possible partners. 

Dixon supports efforts to relax a foreign ownership cap in Qantas. Under
current rules, foreign airlines can own no more than 25 per cent of its
stock and limits overall foreign ownership to 49 per cent of the carrier. 

Singapore Airlines, Asia's largest carrier by stock market value, said in
May its net profit hit a record 1.39 billion Singapore dollars, about $817
million US, in its financial year ending March 31, despite spiking jet fuel
prices and rising competition from Asia's growing number of budget carriers.


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