Speaking during the CAPA Australia Pacific Aviation Summit in Sydney yesterday, Mr Wilson said there had been a jump of about 17 per cent in capacity from Asia into Australia.
He said factors that had put the market under pressure included the slowdown of the Chinese economy, the extra seats put into the Asia market by the Qantas decision to move its European hub to Dubai, the depreciation of the Australian dollar and uncertainty created by the federal budget.
“Even though the economic fundamentals are not as bad as sentiment would suggest, sentiment’s still quite bad,’’ he said. “This means that of all the places in the network, I think most airlines are finding Australia quite tough at the moment.’’
Mr Wilson said carriers had been cutting capacity to Australia, with Qantas down-gauging aircraft and withdrawing from Perth and Singapore Airlines redeploying an A380.
“Two years ago Australia was the star and China was a work in progress,’’ he said. “Now the boot’s on the other foot.’’
Australia accounts for about 41 per cent of Scoot’s total network capacity in terms of seats, flying to Sydney six times a week, Perth five times a week and five times a week to the Gold Coast.
Mr Wilson said the Singapore-based low-cost carrier was still “doing OK’’ in the Australian market and remained committed to being here. But it had trimmed one daily flight in Sydney until December and linked Sydney to Gold Coast flights on two days to free up an aircraft so it could boost services to China.
He expected Scoot to return to normal services in December-January.
“And when we get the 787s coming down here in February-March next year, the economics of those allow us not just to restore what we have but potentially consider a little bit more,’’ he said.
Scoot has 20 Boeing 787-8 and 787-9 Dreamliners on order, with 11 aircraft coming between November this year and March 2016.
It is likely to use the 375-seat 787-9 on its Sydney services and the 335-seat 787-8 on the Gold Coast.
Mr Wilson said using the smaller plane for the Gold Coast was not because it was a particularly weaker market but because the airline did not yet fly daily.
“The slightly smaller capacity means we can then increase the frequency and with the frequency comes not only customer convenience but also efficiency,’’ he said. “Our crew aren’t sitting in the ground for so long’’.
In terms of growth, he said the airline would be looking at both increasing frequencies on existing routes and looking at new markets as the airline reaped 25-27 per cent more fuel efficiency from the 787.
“Fuel is about half of our costs so it’s quite a substantial difference to the bottom line,’’ he said. “So with that lower operating costs it then allows you instead of five times a week to Gold Coast to consider daily because there’s a chance you can make the sixth and seventh service viable.
“And who knows, in due course a relatively smaller city like Cairns might be an option.”
He said factors that had put the market under pressure included the slowdown of the Chinese economy, the extra seats put into the Asia market by the Qantas decision to move its European hub to Dubai, the depreciation of the Australian dollar and uncertainty created by the federal budget.
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| Campbell Wilson says Scoot is ‘doing OK’ in Australia and is committed to the market. Picture:Tony McDonough Source: Supplied |
“Even though the economic fundamentals are not as bad as sentiment would suggest, sentiment’s still quite bad,’’ he said. “This means that of all the places in the network, I think most airlines are finding Australia quite tough at the moment.’’
Mr Wilson said carriers had been cutting capacity to Australia, with Qantas down-gauging aircraft and withdrawing from Perth and Singapore Airlines redeploying an A380.
“Two years ago Australia was the star and China was a work in progress,’’ he said. “Now the boot’s on the other foot.’’
Australia accounts for about 41 per cent of Scoot’s total network capacity in terms of seats, flying to Sydney six times a week, Perth five times a week and five times a week to the Gold Coast.
Mr Wilson said the Singapore-based low-cost carrier was still “doing OK’’ in the Australian market and remained committed to being here. But it had trimmed one daily flight in Sydney until December and linked Sydney to Gold Coast flights on two days to free up an aircraft so it could boost services to China.
He expected Scoot to return to normal services in December-January.
“And when we get the 787s coming down here in February-March next year, the economics of those allow us not just to restore what we have but potentially consider a little bit more,’’ he said.
Scoot has 20 Boeing 787-8 and 787-9 Dreamliners on order, with 11 aircraft coming between November this year and March 2016.
It is likely to use the 375-seat 787-9 on its Sydney services and the 335-seat 787-8 on the Gold Coast.
Mr Wilson said using the smaller plane for the Gold Coast was not because it was a particularly weaker market but because the airline did not yet fly daily.
“The slightly smaller capacity means we can then increase the frequency and with the frequency comes not only customer convenience but also efficiency,’’ he said. “Our crew aren’t sitting in the ground for so long’’.
In terms of growth, he said the airline would be looking at both increasing frequencies on existing routes and looking at new markets as the airline reaped 25-27 per cent more fuel efficiency from the 787.
“Fuel is about half of our costs so it’s quite a substantial difference to the bottom line,’’ he said. “So with that lower operating costs it then allows you instead of five times a week to Gold Coast to consider daily because there’s a chance you can make the sixth and seventh service viable.
“And who knows, in due course a relatively smaller city like Cairns might be an option.”
Credits to : The Australian
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