Is Singapore An Air Hub?

The Sunday Times article “The rise of Gulf carriers” dated 13 March 2016 seeks to analyse the success of the Gulf carriers namely Emirates, Etihad and Qatar Airways.

It looks like Singapore may be losing its hub status, being so far south from connections in Europe, Africa and Middle East. According to Mr Andrew Wong, regional director of TripAdvisor Flights, “The Middle East hubs of Dubai, Doha and Abu Dhabi really make sense as a gateway to the world."

Singapore Management University’s aviation specialist and assistant professor of strategic management Terence Fan believed that “The high oil prices in the past decade or so helped fuel the economy in the Middle East and that stimulated the rapid ascendance of these airlines.”  The Gulf cities seem a more logical hub between cities in Europe, Asia, Africa, Australia and New Zealand, as well as North and Central America and even South America.  Professor Fan added that “The Middle East is, therefore, well positioned to be a super hub of the world.”

In the same Straits Times article, it was reported that in 2014, the Emirates group achieved profits of US$1.5 billion, an increase of 34% from the previous year, and the 27^th straight year of profits.  Etihad showed its strongest financial results with a net profit of US$73 million, an increase of 52.1% over the previous year.  Qatar too, made a net profit of US$103 million. 

Besides a strategic geographical location, young fleets with the newest planes, latest products, and memorable customer experiences, how else can airlines compete?  It may be worthwhile to evaluate the business model of the Emirates Group that comprises more than 50 specialist businesses, including Emirates airline and dnata.  Its numerous ancillary businesses include a most comprehensive travel and tourism supply chain:

·         Air Transport

·         Airport Aviation Services: Catering

·         Call Centre

·         Freight Forwarding & Logistics

·         Hotels & Resorts

·         Retail

·         Air Cargo Support Services

·         Airport Meet & Greet

·         Engineering Services

·         Ground handling, cargo, travel and catering services

·         Loyalty & Reward Programmes

·         Retail, Food & Beverage

·         Sports & Club Facilities

·         Risk Management & Security

·         Tour Operator & Events Management

·         Travel

·         Training

Yes, Changi Airport is working on its Project Jewel, a new retail and lifestyle project.  We are building T4 and T5 is on its way.  But, can we do more?  So, is Singapore still an air hub?

Dubai International Airport