Silkair to be merged with Singapore Airlines

Singapore Airlines (SIA) plans to bring Silkair under the main SIA brand and spend $100 million upgrading the regional carrier’s cabins to offer closer product and service consistency for passengers.

Silkair is wholly-owned by SIA flying an all-narrowbody fleet of 22 Boeing 737 and 11 Airbus A320 family aircraft to regional destinations within the Asia Pacific region, including Cairns and Darwin in Australia. The A320 series aircraft are on the way out as the airline transitions to an all-Boeing fleet.

It is a full-service carrier that provides meals, has in-flight entertainment (streamed to personal devices) and includes checked baggage with every business and economy class ticket, as well as offering interline and through-check options for travellers on multi-stop itineraries.

SIA said on Friday the $100 million would be spent on installing lie-flat seats in business class, as well as seat-back inflight entertainment systems in both business and economy. The cabin upgrades were due to begin in 2020.

“This will ensure closer product and service consistency across the SIA Group’s full-service network,” SIA said in a statement.

No timeline was given for when the two airlines would be merged. Rather, SIA said the merger would occur only after a sufficient number of aircraft have been fitted with the new cabin products.

“Specific details will be announced progressively as the programme develops and timelines are finalised,” SIA said.

SIA chief executive Goh Choon Phong said the merger, the latest initiative in the airline group’s three-year transformation plan that was launched in 2017, would provide “more growth opportunities” for the airline group.

“Importantly, it will be positive for our customers. It is another example of the major investment we are making to ensure that our products and services continue to lead the industry across short-, medium- and long-haul routes,” Goh said.

Once the merger is complete, SIA will have two brands in its airline group, comprising full-service Singapore Airlines and low-cost carrier (LCC) Scoot.

In 2017, the Tigerair Singapore colours and livery was retired and its operations integrated with Scoot under a single brand and operating licence.

Silkair has an important role in the SIA group’s network, given its narrowbody aircraft are able to serve secondary cities in the AsiaPacific within six and a half hours flight time from Singapore more economically and with an appropriate level of capacity than Singapore Airlines’ all-widebody fleet.

And many SilkAir destinations are markets where it is difficult to generate high loads on a year-round basis but are important to maintain because of their role in the overall SilkAir/Singapore Airlines network, particularly as passengers are often connecting onto Singapore Airlines’ long-haul routes.

The announcement Silkair would be folded into Singapore Airlines’ operations appears to be the logical conclusion following efforts on having a closer integration between the two carriers in recent times, including selling connecting itineraries, coordinating on joint pricing and optimising flight schedules for maximum network connectivity.

Indeed, Silkair, Singapore Airlines and the SIA-owned low-cost carrier Scoot have been transferring routes between each other to ensure the right product was on the right route based on market conditions. The three airlines have also begun selling tickets involving connections of each other’s flights.


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