Tigerair and SilkAir were merged into Scoot and Singapore Airlines to simplify model – says CEO
Creating a more simple model was the main motivation behind Singapore Airlines whittling the number of its brands from four – Scoot, Tigerair, SilkAir and Singapore Airlines – to just two: Scoot and Singapore Airlines.
Singapore Airlines CEO Goh Choon Phong spoke about the reasons driving the consolidation of its brands during a session discussing the portfolio strategy of the airline at the first Skift Forum Asia.
In response to a question from Skift airline weekly editor Madhu Unnikrishnan on the decision to wind down SilkAir, Goh pointed to the fact that SIA at one stage had four airline brands – two low cost carriers (Tigerair and Scoot) and two full service airlines (Singapore Airlines and SilkAir) – across short, medium and long haul routes.
“It was not the most efficient way to address connectivity,” he said.
And so the decision to merge Tigerair into Scoot and SilkAir into Singapore Airlines was to “simplify the model” – said Goh.
Asked whether SIA was contemplating a more premium offering under the Scoot brand, Goh said: “Our model is to keep things pure. Singapore Airlines and Scoot offer two ends of the spectrum. We can compete and win in those segments.
“Anyone in between will have a hard time.”
Goh also addressed the reason why SIA first opted to start a low-cost offering. He said: “10 years ago, we realised low cost carriers were a structural, and not a cyclical, change.
“We decided to be involved for two key reasons: Without a low cost carrier, we could not participate in that growth.
“Also, they made it difficult for us to operate as a short-haul carrier. There were many hugely successful examples of full service airlines setting up low cost options. Most of these were done to serve smaller cities.”
Given Singapore’s city state status, this was not an option, said Goh, who added that Scoot was created to work as seamlessly as possible with the main brand. It was the right decision in hindsight, he claimed. Goh also pointed out that low cost carriers now accounted for over 50% of traffic in the region.
I read the article and to me it was a bit puzzling to have a regional airline (Silkair) and a budget airline (Tigerair and Scoot) operating under a parent airline (Singapore Airline). It makes sense now but why introduce Scoot at a later date and then merge it with Tigerair? Wouldn’t it be a better decision not to introduce Scoot but rename Tigerair instead?
ReplySilkair offered a better service to Scoot/Tigerair. Would the decision to replace Silkair have any impact on the quality of services offered now by Scoot? And saying so, would the fare come down as a result?
I wish the new management every success in his role as CEO but to remain competitive, I hope this decision made would offer a better opportunity for everyone to enjoy a better venture on all its flights.
Tiger started as an independent airline, and was acquired by SIA in 2014. Scoot was started by SIA in 2012
ReplyScoot has a better reputation than tiger. Hence folding it into scoot carries less baggage.
ReplyFinally….CONSOLIDATION IS MUCH BETTER THAN DIVERSIFICATION.
Markets are so much stronger when you SOLIDIFY YOUR GOLD STANDARD BRAND.
Especially in AIR TRANSPORT OF PEOPLE ,….WHO REALLY CARE MORE FOR THEIR OWN SAFETY THAN SITTING IN DIFFERENT BRANDS TO FLY IN.. …..DOES IT MATTER ?????
End of the day…..everyone wants to touch down SAFE AND SOUND.
THAT IS ALL !!!!
HUMAN NEEDS ARE VERY SIMPLE…..BUT AIRLINES COMPLIICATE THINGS SO MUCH THAT IT THREW CAUTION INTO THE WINDS !!!!!!
STICK TO YOUR GOLD STANDARD BRAND ….AND IMPROVE ON IT DAY BY DAY !!!!!
People who are travellers simply need DAMNED GOOD PILOTS AND CREWS TO SEE FOR THEIR SAFETY, NEEDS AND SMALL DEMANDS.
Travellers all have ONE PURPOSE ……FLY US THERE 100% SAFE AND CANT WAIT TO GET OUT OF THIS PLANE !!!!!
No matter how much money you put inside the plane to customise….honestly…..people will not appreciate SO MUCH AS COMPARED TO SEE THE JOY OF ARRIVING ALL SAFE AND SOUND.
IN THEIR DESTINATIONS !!!!!
Of course, you make your passengers as comfortable as possible.
THAT IS YOUR JOB !!!!!!!
SIMPLICITY AND GREAT SKILLS AND EXPERIENCES OF PILOTS AND CREWS ….ARE THE MAIN ORDER OF THE DAY !!!!!!
EVERYTHING ELSE…….MELLOW IN THE DISTANCE ……
ReplyWhile you’re dishing advice or obvious statements, how about some grammar? We can hear you shouty mcshout pants
ReplyEnough with the caps already
ReplyShould merged scoot and tiger air into Silkair. It’s a nicer and more prestigious name to use given its years of existence.
ReplyAbsolutely!
ReplyScoot has a [Edited under Mumbrella’s community guidelines] compared to the customer experience of Silk.
Yet another own-goal for SIA.
Silk is being merged into Singapore Airlines and thus will remain full service. It is not being merged into Scoot.
ReplyWell, DUH Mr. Goh. did no one in your massive marketing department consider this when you launched Scoot? Why didn’t you just reposition Silk Air and fold-in Tiger at that time, Rather than build Scoot, which has a horrible UX by comparison?
ReplySilk is a WAY better brand than Scoot (even as a low-cost carrier), has better service and customer experience.
Seriously, how much money did SIA spend on new Tiger and Scoot planes, paint, collateral, marketing, etc. only to be “consolidating” now. Everyone saw it years ago. Seems like an obvious own-goal. PLEASE make sure that the “new Scoot” takes the best customer service attributes and UX of Silk.
I think scoot is a budget airline n silkair is not. Silkair is a full service ‘value’ airline. Now silkair is degraded n scoot is overated. Silkair has service while scoot dun. I am worried we lost this advantages of ‘premium economy’ airline brand to airasia. It is something for us like how some of us dun want budget airline, we rather pay abit more for comfort but not sia rate. Etc. I rather pay for thai airline most of time unless Scoot or AirAsia has fire sales promo. Xiaomi is in between budget n premium hp. The sales are solid. It is more about marketing correctly.
Replywho really cares….the entire brand is [Edited under Mumbrella’s community guidelines] and competitors offer
Replysimilar experience [Edited under Mumbrella’s community guidelines]? Do I travel to see some heavily made up [Edited under Mumbrella’s community guidelines] who behave like [Edited under Mumbrella’s community guidelines]? No.
Geeez you guys are heavy on censorship….
ReplyHow to write headlines to suit the propaganda…. They merged because Singapore Airlines is [Edited under Mumbrella’s community guidelines] due to the competition from the Gulf’s airline. And instead of trying to lower costs and improve service they stick to their [Edited under Mumbrella’s community guidelines]. Singapore Airline once the jewel of Asia is fast becoming a [Edited under Mumbrella’s community guidelines] airline and soon will follow the like of Cathay Pacific, or Philippines Airlines, or Malaysian Airlines.
ReplyWe used Silk Air from Singapore to Da Nang and also Langkawi.
ReplyWe flew Scoot in March from Singapore to Langkawi although just over an hours flight, found the crew not friendly.
We used Silk Air from Singapore to Da Nang and flew in Business Class. I presume the flights now to Da Nang are now going to be all economy.
We always fly Singapore Air from London and return in the Suites, is this also going to change or remain as superb as it has always been.
May now need to look at a new way to fly to Da Nang and langkawi rather than via Singapore.
Will this mean that due to the Silk/SIA merger there will be 737’s flying with SIA livery? That will be interesting to see.
ReplySQ used to be leading the industry, redefining category. Now it’s just another [Edited under Mumbrella’s community guidelines].
ReplyI wish SQ takes a bolder step and disrupt the industry.
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