\n<\/p>\n
Mr Sum said one challenge is that SIA often takes minority stakes without full strategic or operational control, meaning it shares in the financial downside without being able to control fleet, network, capacity, costs or management.\u00a0<\/p>\n
Airlines are difficult investments to begin with, he added, being capital-intensive, cyclical businesses with high fixed costs, volatile fuel prices and heavy regulatory constraints.\u00a0<\/p>\n
SIA’s stakes have also tended to be in challenging markets or airlines already in need of substantial improvement, he said.<\/p>\n
OCBC equity research analyst Ada Lim made a similar point about SIA repeatedly entering structurally difficult markets.\u00a0<\/p>\n
\u201cThe carrier has attempted, time and again, to enter the domestic aviation market in Australia, which is reportedly one of the most lucrative in the world due to an effective duopoly structure between Qantas and Virgin Australia,\u201d she said.<\/span><\/p>\n However, the duopoly structure is what makes it difficult for new entrants to break in, she added.<\/span><\/p>\n India\u2019s market is \u201cpolitically and commercially complex\u201d even though it is growing quickly, Ms Lim said.<\/span><\/p>\n Unexpected shocks followed the merger of Vistara \u2013 which SIA had initially invested in \u2013 with Air India, she said, pointing to Pakistan’s closure of its airspace to Indian carriers and the <\/span>Air India Flight 171 crash <\/span>that killed more than 240 people on board.<\/span><\/p>\n SIA said its investment in Air India is a long-term strategic commitment aligned with the group’s multi-hub strategy, noting that Air India holds valuable slots and air traffic rights at key domestic and international airports.<\/span><\/p>\n “This investment differs from SIA\u2019s previous equity holdings, which were undertaken in different contexts and for different strategic objectives,” the airline said.<\/span><\/p>\n Singapore’s small size means it has no domestic aviation market and SIA cannot rely on a baseload of domestic traffic, Ms Lim said. This makes overseas expansion a strategic driver as part of its multi-hub strategy.\u00a0<\/p>\n The airline is also pursuing other avenues for growth, she said, including fleet renewal and premiumisation to target higher-yielding customers, with next-generation first- and business-class seats expected to roll out in the first quarter of next year.\u00a0<\/p>\n It can also grow its portfolio of network partnerships and tap the ongoing maintenance, repair and overhaul upcycle through SIA Engineering, she added.<\/p>\n Mr Sum said SIA can still grow by increasing transit traffic through Changi Airport, including using Scoot to provide feeder traffic into the network.\u00a0<\/p>\n Scoot can also expand further into price-sensitive markets or add frequencies and destinations, he said.<\/p>\n<\/div>\n Mr Sum said one challenge is that SIA often takes minority stakes without full strategic or operational control, meaning it shares in the financial downside…<\/p>\n","protected":false},"author":1,"featured_media":86612,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/dam.mediacorp.sg\/image\/upload\/s---ht-KiiH--\/c_crop,h_448,w_798,x_0,y_18\/c_fill,g_auto,h_676,w_1200\/fl_relative,g_south_east,l_mediacorp:cna:watermark:2024-04:reuters_1,w_0.1\/f_auto,q_auto\/v1\/one-cms\/core\/2026-09-09T052358Z_3_LYNXMPEM880AT_RTROPTP_3_AIR-INDIA-FUNDRAISING-SINGAPORE-AIR.JPG?itok=4ekI78Vu","fifu_image_alt":"","footnotes":""},"categories":[2],"tags":[364,15,1339,30357,1390,5060,9063,5109],"class_list":["post-86611","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buzz-news-sg-global","tag-air","tag-cna","tag-explains","tag-fared","tag-india","tag-investments","tag-sias","tag-stake","wpcat-2-id"],"brizy_media":[],"_links":{"self":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts\/86611","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=86611"}],"version-history":[{"count":0,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/posts\/86611\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=\/wp\/v2\/media\/86612"}],"wp:attachment":[{"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=86611"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=86611"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sgbuzz.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=86611"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What about the Air India investment?<\/span><\/h2>\n
How else can SIA grow?<\/span><\/h2>\n
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