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CNA
11 hours ago
- Business
- CNA
Deep Dive Podcast: Jetstar Asia closure - Are the days of cheap fares over?
Jetstar Asia will cease operations on Jul 31, a move unsurprising to experts because the low-cost carrier was struggling to turn a profit in a tough aviation market. Otelli Edwards speaks to Shukor Yusof from aviation consultancy Endau Analytics and Dr Nitin Pangarkar from NUS Business School to find out what the future holds. Here is an excerpt from the conversation: Otelli Edwards, host: I believe Changi Airport is aiming to expand its network to over 200 cities by the mid-2030s. But airlines will need to pay about 40 per cent more to land and park at Changi over time. To some extent, that's going to affect Changi's competitiveness as an aviation hub, don't you think? Dr Nitin Pangarkar, NUS Business School: It will, but it's a question of who they are competing against, right? They cannot compete on cost versus, say, Bangkok or Kuala Lumpur. Probably, they are targeting the Dohas and the Dubais and so on. Basically, their basis of comparison is that. When I arrived in Singapore 30 years ago, I must say that based on my impressions as a traveller, Changi seemed a lot more functional than luxurious. Otelli: Without the waterfalls and all the wonderful features. Dr Nitin: Yeah, without the waterfalls, without Jewel. There were only Terminals 1 and 2. (Terminal 2) was the new terminal at that time. I think Changi has taken a bit of a shift towards luxury. And when you do that, your costs go up. Singapore has also become more affluent. So everything is more expensive. Singapore is going to be a high-cost place compared to say, KL or Bangkok or some similar regional hub. Otelli: It's a bit worrisome for a large group of people who are used to S$100 and under sort of flight tickets, right? I guess to a certain extent, that is not practical, because then how does Jetstar for instance, make money? Does that also mean those days are over, that we shouldn't be expecting to pay such low prices? Shukor Yusof, Endau Analytics: They are over, a long time ago, post-COVID. I can confirm it's over. It's only low cost in name, but in reality, it's pretty much high fares. You have ancillary fees, you have a lot of other payments that you are going to be making. Otelli: So you think it has narrowed the gap (between) what you're paying for these so called low-cost carriers versus the legacy airlines? Shukor: Very much. So what we're seeing now is the legacy airlines, the flag carriers, are in fact becoming low-cost or budget airlines, if you look at Malaysia Airlines, Thai Airways, or Philippine Airlines. So those days when you could fly for a plate of chicken rice for example. For S$10 at the hawker centre, you could fly to Bangkok, you could fly to Jakarta. I've done that before ... at the forefront of when all these budget airlines were coming into the business. But now it's very different. It's more competitive. Previously, AirAsia had the first-mover advantage. They were the only ones running around and then subsequently, all the neighbours next to Singapore got very excited and they came up with their own low-cost carriers.
CNN
23-03-2025
- Business
- CNN
Heathrow Airport closure: Global air travel chaos may last days and cost hundreds of millions in losses
Source: CNN With London's Heathrow Airport shut Friday, global air travel is expected to be disrupted for days, potentially costing the airline industry hundreds of millions of dollars. The chaos in air travel caused by a fire at an electrical substation supplying the airport could last days, according to aviation experts. Heathrow's closure is expected to affect more than 1,300 flights in the coming days, and airline analytics firm Cirium estimated that 'upwards of 145,000' passengers could be affected. Shukor Yusof, founder of Singapore-based Endau Analytics, an advisory firm that focuses on the aviation industry, told CNN the financial losses from the shutdown could be in the 'hundreds of millions of pounds.' The fallout 'will cause chaos, undoubtedly, for the weekend and into next week because they have to resolve all those flights that couldn't come in, all those problems that have piled up because of this shutdown,' he said. Heathrow was the world's fourth-busiest airport in 2023, according to the most recent data, with a record-breaking 83.9 million passengers passing through last year. John Grant, senior analyst at travel data provider OAG, estimates that it will take up to four days for the flight disruptions to fully resolve, he told CNN. Likewise, Cirium said: 'The impact of this incident can cascade over several days as aircraft, crew, passengers are out of place, with limited spare aircraft and seats available to recover passengers.' Airlines rely on precisely coordinated networks to ensure planes and crews are in the right place at the right time. Now, dozens of carriers must rapidly restructure their operations to reposition aircraft and staff. Yusof at Endau Analytics said a closure like this could affect entities and people beyond airlines and travelers. It's a 'whole network of people involved' in running the operations of an airport and adjacent areas, ranging from retailers, cargo firms, jet fuel suppliers and surrounding communities that depend on the airport for their livelihoods, he added. 'At the moment, I think that the real focus is how to mitigate the impact of the airport closure on airlines and also on the people who work there,' Yusof explained, as it could take days, or even weeks, for airlines to clear the backlog of passengers. Shares of airlines operating out of Heathrow tumbled Friday. British Airways owner International Airlines Group sank as much as 5% early morning local time, before paring losses to trade 2.2% down on the day by mid-afternoon. Compensation for travelers is likely to be the largest immediate cost for the airline, analysts at Jefferies, an investment bank, said in a note. Shares in Germany's Lufthansa were down 2.1% by the same time, while Air France-KLM had fallen 2.5%. Shares in Australian airline Qantas closed 2.4% down. British Airways canceled all short-haul flights to Heathrow Friday but said it had been given clearance by Heathrow Airport 'to depart eight of our long-haul flights today from 7pm.' All customers booked for travel to or from Heathrow between Friday and Sunday will have the option to rebook for free for a later travel date, according to the airline. See Full Web Article
CNN
21-03-2025
- Business
- CNN
Global air travel chaos caused by Heathrow closure may last days and cost hundreds of millions in losses
With London's Heathrow Airport shut Friday, global air travel is expected to be disrupted for days, potentially costing the airline industry hundreds of millions of dollars. The chaos in air travel caused by a fire at an electrical substation supplying the airport could last days, according to aviation experts. Heathrow's closure is expected to affect more than 1,300 flights in the coming days, and airline analytics firm Cirium estimated that 'upwards of 145,000' passengers could be affected. Shukor Yusof, founder of Singapore-based Endau Analytics, an advisory firm that focuses on the aviation industry, told CNN the financial losses from the shutdown could be in the 'hundreds of millions of pounds.' The fallout 'will cause chaos, undoubtedly, for the weekend and into next week because they have to resolve all those flights that couldn't come in, all those problems that have piled up because of this shutdown,' he said. Heathrow was the world's fourth-busiest airport in 2023, according to the most recent data, with a record-breaking 83.9 million passengers passing through last year. John Grant, senior analyst at travel data provider OAG, estimates that it will take up to four days for the flight disruptions to fully resolve, he told CNN. Likewise, Cirium said: 'The impact of this incident can cascade over several days as aircraft, crew, passengers are out of place, with limited spare aircraft and seats available to recover passengers.' Airlines rely on precisely coordinated networks to ensure planes and crews are in the right place at the right time. Now, dozens of carriers must rapidly restructure their operations to reposition aircraft and staff. Yusof at Endau Analytics said a closure like this could affect entities and people beyond airlines and travelers. It's a 'whole network of people involved' in running the operations of an airport and adjacent areas, ranging from retailers, cargo firms, jet fuel suppliers and surrounding communities that depend on the airport for their livelihoods, he added. 'At the moment, I think that the real focus is how to mitigate the impact of the airport closure on airlines and also on the people who work there,' Yusof explained, as it could take days, or even weeks, for airlines to clear the backlog of passengers. Shares of airlines operating out of Heathrow tumbled Friday. British Airways owner International Airlines Group sank as much as 5% early morning local time, before paring losses to trade 2.2% down on the day by mid-afternoon. Compensation for travelers is likely to be the largest immediate cost for the airline, analysts at Jefferies, an investment bank, said in a note. Shares in Germany's Lufthansa were down 2.1% by the same time, while Air France-KLM had fallen 2.5%. Shares in Australian airline Qantas closed 2.4% down. British Airways canceled all short-haul flights to Heathrow Friday but said it had been given clearance by Heathrow Airport 'to depart eight of our long-haul flights today from 7pm.' All customers booked for travel to or from Heathrow between Friday and Sunday will have the option to rebook for free for a later travel date, according to the airline. Anna Cooban and Olesya Dmitracova in London contributed to this report.
CNN
21-03-2025
- Business
- CNN
‘Hundreds of millions of pounds in losses' expected as disruptions extend beyond Heathrow Airport
With Heathrow Airport shut on Friday, the impact of disruptions is expected to extend well beyond Britain's largest travel hub, potentially costing the airline industry hundreds of millions of pounds. The chaos in global air travel caused by a fire at an electrical substation supplying the airport could last days, if not weeks, according to an aviation expert. As of early Friday, hundreds of flights to and from Heathrow have been canceled or diverted. Airline analytics firm Cirium estimated that 'upwards of 145,000' passengers could be affected. Shukor Yusof, the founder of Singapore-based Endau Analytics, an advisory firm that focuses on the aviation industry, told CNN the financial losses from the shutdown could be in the 'hundreds of millions of pounds.' The fallout 'will cause chaos, undoubtedly, for the weekend and into next week because they have to resolve all those flights that couldn't come in, all those problems that have piled up because of this shutdown,' he said. Heathrow was the world's fourth-busiest airport in 2023, according to the most recent data, with a record-breaking 83.9 million passengers passing through last year. Yusof said a closure like this could affect entities beyond airlines and travelers. It's a 'whole network of people involved' in running the operations of an airport and adjacent areas, ranging from retailers, cargo firms, jet fuel suppliers and surrounding communities that depend on the airport for their livelihood, he added. Airlines rely on precisely coordinated networks to ensure planes and crews are in the right place at the right time. Now, dozens of carriers must rapidly restructure their operations to reposition aircraft and staff. 'At the moment, I think that the real focus is how to mitigate the impact of the airport closure on airlines and also on the people who work there,' Yusof explained, as it could take days, or even weeks, for airlines to clear the backlog of passengers. British Airways said it is redirecting inbound flights already on their way to Heathrow to other UK airports, and it advised passengers on flights originally scheduled for Friday from Heathrow not to travel to the airport until further notice. 'This will clearly have a significant impact on our operation and our customers and we're working as quickly as possible to update them on their travel options for the next 24 hours and beyond,' the airline said in a statement sent to CNN. Seven United Airlines flights have returned to their point of origin or been diverted to other airports, according to the American carrier. Its Friday flights to Heathrow have been canceled, and it is working to offer customers alternative travel options, it said. Singapore Airlines said three flights en route to London have either been diverted to Frankfurt or Paris or returned to Singapore. Another five flights to and from Heathrow have been canceled, the airline said. Hong Kong's Cathay Pacific has cancelled several flights to and from London, the company told CNN. Australia's Qantas said in a statement to CNN that two flights bound for London on Thursday from Singapore and Perth, respectively, have been diverted to Paris. Air India said in a X post that all flight operations to Heathrow on Friday have been cancelled. All Virgin Atlantic flights arriving in and departing from Heathrow would be canceled until midday Friday, with the rest of the flights under review, the company said in a statement to CNN. CNN has also reached out to Delta Airlines and American Airlines.
Yahoo
21-03-2025
- Business
- Yahoo
‘Hundreds of millions of pounds in losses' expected as disruptions extend beyond Heathrow Airport
With Heathrow Airport shut on Friday, the impact of disruptions is expected to extend well beyond Britain's largest travel hub, potentially costing the airline industry hundreds of millions of pounds. The chaos in global air travel caused by a fire at an electrical substation supplying the airport could last days, if not weeks, according to an aviation expert. As of early Friday, hundreds of flights to and from Heathrow have been canceled or diverted. Airline analytics firm Cirium estimated that 'upwards of 145,000' passengers could be affected. Shukor Yusof, the founder of Singapore-based Endau Analytics, an advisory firm that focuses on the aviation industry, told CNN the financial losses from the shutdown could be in the 'hundreds of millions of pounds.' The fallout 'will cause chaos, undoubtedly, for the weekend and into next week because they have to resolve all those flights that couldn't come in, all those problems that have piled up because of this shutdown,' he said. Heathrow was the world's fourth-busiest airport in 2023, according to the most recent data, with a record-breaking 83.9 million passengers passing through last year. Yusof said a closure like this could affect entities beyond airlines and travelers. It's a 'whole network of people involved' in running the operations of an airport and adjacent areas, ranging from retailers, cargo firms, jet fuel suppliers and surrounding communities that depend on the airport for their livelihood, he added. Airlines rely on precisely coordinated networks to ensure planes and crews are in the right place at the right time. Now, dozens of carriers must rapidly restructure their operations to reposition aircraft and staff. 'At the moment, I think that the real focus is how to mitigate the impact of the airport closure on airlines and also on the people who work there,' Yusof explained, as it could take days, or even weeks, for airlines to clear the backlog of passengers. British Airways said it is redirecting inbound flights already on their way to Heathrow to other UK airports, and it advised passengers on flights originally scheduled for Friday from Heathrow not to travel to the airport until further notice. 'This will clearly have a significant impact on our operation and our customers and we're working as quickly as possible to update them on their travel options for the next 24 hours and beyond,' the airline said in a statement sent to CNN. Seven United Airlines flights have returned to their point of origin or been diverted to other airports, according to the American carrier. Its Friday flights to Heathrow have been canceled, and it is working to offer customers alternative travel options, it said. Singapore Airlines said three flights en route to London have either been diverted to Frankfurt or Paris or returned to Singapore. Another five flights to and from Heathrow have been canceled, the airline said. Hong Kong's Cathay Pacific has cancelled several flights to and from London, the company told CNN. Australia's Qantas said in a statement to CNN that two flights bound for London on Thursday from Singapore and Perth, respectively, have been diverted to Paris. Air India said in a X post that all flight operations to Heathrow on Friday have been cancelled. All Virgin Atlantic flights arriving in and departing from Heathrow would be canceled until midday Friday, with the rest of the flights under review, the company said in a statement to CNN. CNN has also reached out to Delta Airlines and American Airlines.
