96% Of SIA’s Scheduled Capacity Until End-Apr 2020 Will Be Cut Off Due To Covid-19

By
Shawn Ambrose
-

In January, when we first started writing articles on what was then called the Wuhan Virus, I never envisaged how devastating and pervasive this disease would be.

And every day, it seems to get worse.

You want me to wash my hands more regularly? Fine, no one likes filthy hands anyway.

You want me to stand further apart from other humans? Great, I hate other people anyway. 

But now you want to take the thing that means the most away from me? 

Reader: Your family?

Worse… travel.

You see, with numerous countries all over the world implementing lockdowns to curb the spread of the virus, travelling is simply no longer an option.

As a result, many airline companies have had to resort to drastic measures to stay afloat.

96% Of SIA’s Scheduled Capacity Until End-Apr 2020 Will Be Cut Off Due To Covid-19

Singapore Airlines (SIA) announced it will be cutting 96% of its scheduled capacity till end-April 2020 due to the tightening of border controls around the world.

138 SIA and one SilkAir aircraft out of a total fleet of 147 will be grounded, in what SIA called the greatest challenge the group has faced in its existence.

Scoot will also suspend most of its network, resulting in the grounding of 47 of its fleet of 49 aircraft.

All this just because of one little virus.

Border controls

As you know, many countries have imposed lockdowns or restricted travel in and out of the country to curb the spread of the coronavirus.

Image: Reuters

Both Austalia and New Zealand, for example, recently closed their borders to foreigners.

Singapore, too, said on Sunday that all short-term visitors will no longer be allowed to enter or transit through the country from 11.59pm on Monday.

But while other airline companies in other countries will be affected too, Singapore Airlines is more vulnerable in this situation because they do not have a domestic segment.

Though if at some point in the future I could fly from Changi to Boon Lay, that’d be great.

As a result, SIA said that it is actively taking steps to build up its liquidity and to reduce capital expenditure and operating costs.

Cutting Salaries & Deferring Deliveries

The first of which is deferring upcoming aircraft deliveries from aircraft manufacturers. If agreed, SIA will consequently defer payment for those aircraft deliveries.

The group’s management has also had its salaries cut, with the company’s directors also agreeing to a cut in their fees. CEO Goh Choon Phong said he has taken a 15 per cent salary cut.

In addition, nearly 27,000 SIA staff have been offered a voluntary no-pay leave scheme.

According to The Straits Times,  SIA Group has also drawn on its lines of credit to meet its immediate cash flow requirements and has even consulted several financial institutions for its future funding requirements.

Image: Giphy

SIA said it is unclear when they will resume normal services, “given the uncertainty as to when the stringent border controls will be lifted”.

And the Centre for Asia Pacific Aviation has also estimated that about half of all global airlines could disappear before the year-end because of Covid-19.

I’m an optimist, but the future looks a little bleak.

Reader: Hey, where’s the optimism I come to Goody Feed for?

Uh, on the bright side, bubble tea shops in the country are still open?

Reader: That’s my boy

Here’s a simplified summary of the South Korea martial law that even a 5-year-old would understand:

Read Also:

Advertisements
 
Shawn Ambrose
Email: [email protected]