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Aviation History
1979
1979 - 0956.PDF
The McDonnell Douglas DC-IO will operate the first passenger service to the USA. The type has a dual role in the fleet, as a regional aircraft and as a long-haul running mate for the 747 "In view of the trend to low fares," commented Mr Lim, "we decided that we needed an aircraft with the lowest possible unit costs." Thus the decision was taken to acquire new 747-20'0s for the Pacific route. SIA is thus competing indirectly with Pan Am, offering a type of service very similar to its Australia-Europe operation. With its high unit costs, Pan Am's service tends to be more attractive to the business market, while SIA will go more for the tourist/VFR market. The Honolulu stopover should prove attractive to tourists, while sector traffic has not been neglected, with SIA offering the only non-stop flights between Hong Kong and Honolulu. mo* i« tin :i" - : ••:::>: ^ -^' : : 3214 751 m ffS The airline's performance is conspicuously displayed in the lobby of the headquarters building The decision to replace the entire 747 fleet followed logically from the requirement for a more capable 747 for the Pacific routes. SIA was able to make the massive in vestment in new 747s because of its policy of accelerated depreciation. In effect this is a form of "inflation account ing," reflecting the rapid and continuing increase in the cost of new aircraft. As the performance of the new air craft was crucial to the Pacific route, the fleet would have had to be rigidly segregated between the Pacific and Australia-Europe routes if the older aircraft were kept in service, causing severe problems in fleet and maintenance scheduling. The timing of the rollover appears to have been immacu late. The massive order for 747s was placed just before the line became choked throughout 1980, while the older air craft came on the market at the peak of the second-hand market value, before Boeing could respond to demand. The aircraft have now been sold to Tigerair (leasing sub sidiary of the Tiger International group) at a reported $35 million each. The choice of the Pratt & Whitney JT9D-7Q engine for the new aircraft illustrates another unusual aspect of SIA policy. The General Electric CF6-50E2, basically similar to the powerplant already on order for SIA DC-lOs, would have provided basically similar performance. But, com ments Mr Lim, "it is our deliberate policy to have both types of engine." The aim, quite simply, is to keep the manufacturer on his toes, knowing that Brand X is already in service with his customer, and in SIA's eyes this has to be counted against the advantages of standardisation. The same policy is apparent in the airframe fleet, with DC-lOs as well as Boeings, and in the airline's use of both IBM and Itel computer systems. SIA has no firm plans for expansion of its Concorde interchange service with British Airways. The present three-per-week service does not justify an SIA pilot force, particularly in view of the airline's own shortage of flight- deck crews; the service will probably be increased to four per week fairly soon. "We don't expect any great profit but we hope not to make a loss," says Mr Lim. Loads so far are "quite satisfactory," considering that the service was resumed at short notice. SIA's financial commitment to the service is based on a formula agreed between SIA and British Airways, taking into account the improvement in British Airways' Concorde utilisation brought about by the SIA service. But the formula reduces both SIA's risk and its potential return. SIA is not in the Concorde busi ness for the money: the main reason, says Mr Lim, is that "we believe that we should offer the public the best pos sible service." This overlaps with the other motivation, which is that "we gain a certain amount of prestige." As for further utilisation of leased Concordes, says Mr Lim, there are "no perfect routes in the system". The regional services are mostly too short; Manila, for instance, is only three hours away by subsonic. "One ideal route is Singapore-Tokyo; its length is ideal, it is overwater and there is a lot of business travel," says Mr Lim, adding with some understatement, "but there is an environmental problem." Europe's aircraft industry could still turn out to be a third source for SIA's fleet. When Flight visited SIA in 1974, Airbus Industrie's A300B4 appeared to be a natural for SIA's regional routes. As it happened, the airline plumped for the 727-200 and a small fleet of "multi-role" DC-10-30s, offering reasonable economics on medium-range regional routes combined with long-range capability in case some sectors proved slow to grow into 747s. Strong traffic growth in most areas, however, means that the DC-lOs will be largely used on longer regional routes, and Mr Lim expects that the fleet will remain at the seven aircraft now in service or on order. SIA is now operating 727s and DC-lOs on regional routes, together with the last of the 707s and 737s, while many of its neighbours are stepping up to A300s. A re quirement for a regional wide-body is foreseen around 1982, and the A300 is now a strong contender. Lockheed, meanwhile, is offering the TriStar 400A. As for the Boeing 767, Mr Lim comments: "My gut feeling is that it may be too small." Boeing will almost certainly stretch the 767, but will be too late to save most of the rapidly growing Orient market from Airbus Industrie. SIA now has a relatively diverse fleet of five basic types, though the 737s and 707s are probably near the end of their careers. Three 707s have been converted to freighter operation since 1977 and more may follow as 727s supplant them on regional routes. The 727s will also move down to replace the runts of the SIA litter, the
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