The codeshare expansion of Air India and Singapore Airlines demonstrates SIA’s second hub ambitions

This morning, Air India and Singapore Airlines issued a joint press release on expanding their codeshare agreement, the first such development since 2010. Singapore Airlines, which will have a 25.1% stake in the combined Air India, and Air India Express as a whole will have subsidiary ownership.

The expansion will add 11 Indian cities and 40 international destinations to their network, with the effective winter schedule starting on October 27. In addition, the two airlines will also codeshare on each other’s flights between Singapore to Bengaluru and Chennai, increasing their number of flights. the total number of weekly scheduled services between the two countries increases from 14 to 56. In both sectors, the operators are Air India Group, Singapore Airlines Group and IndiGo, making competition tough for the Indian market leader.

Codeshares in India

SIA will codeshare on Air India’s domestic flights between Delhi and Amritsar, Bengaluru, Coimbatore, Lucknow and Varanasi; between Mumbai and Ahmedabad, Amritsar, Bengaluru, Coimbatore, Goa, Jaipur, Kolkata, Lucknow and Thiruvananthapuram, and between Kolkata and Guwahati.

Codeshares from Singapore

Air India customers have access to 29 destinations through SIA’s network. These are Adelaide, Brisbane, Cairns, Darwin, Melbourne, Perth and Sydney (Australia), Bandar Seri Begawan (Brunei), Phnom Penh and Siem Reap (Cambodia), Denpasar, Jakarta, Medan and Surabaya (Indonesia), Fukuoka, Nagoya, Osaka, Tokyo-Haneda and Tokyo-Narita (Japan), Busan and Seoul (South Korea), Kuala Lumpur and Penang (Malaysia), Auckland (New Zealand), Cebu and Manila (the Philippines), as well as Danang, Hanoi and Ho Chi Minh City (Vietnam). This includes existing codeshare agreements to Kuala Lumpur.

The surprise

Singapore Airlines customers can connect to Air India’s international services from its three hubs, Delhi, Mumbai and Bengaluru, to eleven destinations including Copenhagen, Paris, Frankfurt, Milan, Nairobi, Amsterdam, Jeddah, Riyadh, Colombo, Birmingham and London. Singapore Airlines already flies to all destinations except Nairobi, Jeddah, Riyadh and Birmingham.

This signals Singapore Airlines’ confidence in Air India and its plans to fly passengers via Air India, despite the current negative publicity around equipment due to a lack of upgrades to the hard product.

While Air India’s flights to London from Delhi are already seeing the new product deploying the A350s, its other destinations to Europe are likely to point to sectors where reconditioned aircraft will be deployed in the future.

Such an early collaboration could pave the way for a metal-neutral pact in the future, at least on the metro routes between Air India and Singapore Airlines. A metal-neutral pact is an agreement between airlines to share revenue, regardless of which airline’s aircraft is used on a flight.

Once the flights go on sale, prices will be announced and whether Singapore Airlines passengers will receive a discount on flights via Delhi on a product that is not currently comparable to Singapore Airlines’ product.

This is also a big step for Delhi airport, which has been aiming to become a hub. Having international operations at the same terminal will allow faster transfers, but longer connection time based on current schedules – for which the codeshare is planned – shows that the airport has the potential to grow its non-aero revenues thanks to captured transfer passengers. This may also need to be expanded to a wider food and retail offering with global brands, as opposed to the current one.

Tail nut

Singapore is a city-state and if Singapore Airlines wants to grow, it needs to think differently, especially with low-cost competition from neighboring Malaysia and cost competition from Thailand and Indonesia. India is a large enough market for Singapore Airlines to enter, and the country has often indicated that it wants to pursue a multi-hub strategy in the future. A multi-hub may or may not mean having two bases for its own aircraft, but it may also mean a strong partnership with equity investments, such as with Air India.

According to data shared exclusively for this article by Cirium, an aviation analytics company, there are 310 weekly flights between India and Singapore, one way, in November. Airlines will offer 69,891 seats each way. Singapore Airlines is the largest airline, with 32% of all frequencies and 40% of all seats. Together with its low-cost subsidiary Scoot, the Singapore Airlines group controls 45% of all frequencies and 54% of all seats in the sector. If you add Air India and Air India Express to the mix, this becomes 74% of all frequencies and 78% of all seats offered. Rival IndiGo has 25% of all frequencies and 22% of all available seats.

For Air India, which is working with more and more airlines and expanding its own network, revenue management will become a complex element to prioritize what makes it more money and how it uses pricing to build an effective hub connecting the East with the West connects, and vice versa. .