SIA to drop nonstop USA flights as Airbus buys back A340s

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Singapore Airlines will terminate ultra-longhaul nonstop flights to Los Angeles and Newark in late-2013 after Airbus agreed to buy back the carrier's five A340-500s.

The deal forms part of SIA's announcement today that it is ordering five additional A380s and 20 A350-900s.

The airline says its decision to retire the A340s is in line with its "policy to maintain a young fleet". However industry sources say the nonstop services between Singapore and the USA continued to fall short of revenue expectations, despite the airline switching to an all-business class cabin layout in an effort to boost yields.

SIA says the removal of the A340s means it will no longer have an aircraft type in its fleet with "sufficient range and operating economics" to serve the USA nonstop.

"Although disappointing that we will be halting these services, we remain very committed to the US market," says SIA chief executive Goh Choon Phong. "Over the past two years we have increased capacity to both Los Angeles and New York by deploying A380 superjumbos on flights via Tokyo and Frankfurt. We will also continue to explore additional options to enhance our US services," he adds.

With its additional Airbus orders announced today, SIA will have outstanding firm purchase or lease orders in place with Airbus and Boeing for 68 widebody aircraft, including 15 A330-300s and eight 777-300ERs ordered last year.

SIA is meanwhile transferring its order for 20 787-9s to low-cost subsidiary Scoot. Regional arm SilkAir has commitments for 54 Boeing 737s, including 31 of the re-engined 737 Max.