IN FOCUS: Singapore’s airline industry appears to be in full flight, but dark clouds lie ahead

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Look beyond record growth and challenges such as supply chain disruptions, increased competition and a manpower crunch are on the horizon.

While local airlines have been riding a post-pandemic high, analysts caution that the good times may not last, with intensifying competition among other challenges. SINGAPORE: The greatest challenge in its existence. That was how Singapore Airlines' chief executive Goh Choon Phong described the COVID-19 pandemic in a staff memo in early 2020.

“We expect that there will be a reversion to the long-term mean in terms of financial performance,” he added, as other experts warned of a potential erosion of profit.Apart from SIA, Jetstar Asia has also cited strong competition as part of ongoing headwinds.Mr Mayur Patel, head of Asia at aviation data consultancy OAG, pointed to a nearly 60 per cent increase in the number of flight routes operating in Southeast Asia, and a fourfold jump in the number of routes by low-cost airlines since 2011.

Singapore's airlines have not been spared from these manpower issues, which were amplified by the pandemic in more ways than one, said experts. But she has also heard from those still with the airline that SIA has had no trouble attracting new hires. Experts said, however, that not all carriers have the same pull as SIA, with its reputation and offer of competitive salaries and benefits.Former cabin crew told CNA they had to undergo four months of training before going on flight duty. “On-the-job” training, as found in other service industries, does not exist in their line of work.

“We’re holding local recruitment drives, and partnering with local and overseas institutions to attract new talent,” the spokesperson added. “Without certain parts or systems, an aircraft might not be able to return to flying… This has also been compounded by a manpower shortfall in the aerospace sector post-COVID, which means there are fewer hands available,” he said.Aviation expert Shantanu Gangakhedkar, a senior consultant at growth advisory firm Frost and Sullivan, said aircraft deliveries are not made willy-nilly, with orders placed as far as 10 to 15 years in advance.

“While manufacturers and suppliers are ramping up production to address the backlog, the complex nature of the aviation supply chain, which involves numerous specialised components from various global suppliers, means that resolving these issues will take time.”have also added a spanner in the works, with production of its popular 737 MAX aircraft now capped and thus further limiting an already-tight supply.

“The industry needs to see how supply can be increased further, such as through in-house production, purchasing from other regions."

 

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