SIA needs to pursue more robust partnerships
While the Virgin Australia and SAS partnerships represent a new level of partnerships for SIA, they still do not go as far as other joint ventures forged in recent years by carriers in North America, Europe and North Asia. The new generation of partnerships typically involve metal neutrality along with anti-trust immunity. But metal neutrality has not yet been pursued by SIA as Virgin Australia and SAS do not operate into Singapore.
Of the 12 partnerships SIA has added or deepened over the last two years, 10 are with carriers that do not serve Singapore. SIA historically has shied away from robust partnerships, particularly with carriers that operate to Singapore, and from full participation in the Star Alliance. As the industry ushers in a new era of partnerships, SIA will inevitably have to pursue more partnerships, closer partnerships and potentially joint venture metal neutral tie-ups with carriers that actually serve Singapore. This is one part of the Group’s strategy that still needs some fine-tuning.
For now Mr Goh will not reveal the Group's full intention when it comes to potential new partnerships, saying “if it makes sense we are open to it”. While the first section of this new, more exciting chapter in SIA’s history has now been written, Mr Goh is not about to sit still. As Mr Goh points out, the industry is now more volatile than it has ever been before and airlines need to be flexible when managing through volatile periods. SIA remains a relatively conservative airline group compared to its peers but the recent changes in strategy are refreshing and should prepare the SIA Group better for whatever challenges that lie ahead.