Despite demand for Singapore Airlines’ flights from China still being below pre-pandemic levels, the airline has added more capacity to China this year. Its CEO noted that a visa-free program for Chinese nationals visiting the Asian hub has helped fill seats.
This year, the capacity of aviation worldwide recovered to pre-pandemic levels. However, the aviation industry in Asia has recovered more slowly due to the ongoing slowdown in international demand in China, the second-largest economy in the world.
According to Singapore Airlines CEO Goh Choon Phong, “travel into China has been strong, travel out of China has not yet fully recovered.”
The visa-free program between China and Singapore went into effect in February. He stated that it had given “some lift to load factors” for Chinese flights.
The airlines group was progressively restoring China capacity and would increase seats to Shanghai, Beijing and Guangzhou this year, Goh added.
Citing a lack of regulatory permissions, the flag carrier canceled flights to Chengdu, Chongqing, and Xiamen in China in April. Now that they are in place, flights can take off until July, at which point new licenses need to be requested, according to Goh.
Singapore Airlines increased its dividend on Wednesday after posting a record yearly profit for the second consecutive year.
But for the March quarter, the carrier’s net profit decreased 4.5% year over year, despite declining profit growth in the two previous quarters.
As airlines increase capacity and note supply chain strain and geopolitical issues, the business anticipates that passenger yields—a measurement of the average fare paid per mile, per person—will continue to drop.
At 13:30 PM (0430 GMT), shares of SIA had decreased 1.6% on the day.
Following Air India’s merger with its joint venture, Vistara, Singapore Airlines is expected to acquire a 25.1% interest in the Indian airline. Goh expressed his hope that this year will bring news of regulatory approvals.
The airline now operates 200 planes, but it plans to increase that number to 209 during the current fiscal year. Goh stated that Singapore Airlines continues to anticipate receiving the Boeing 777-9, a type that has not yet received certification from US authorities, next year.
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