Singapore Airlines has reported record revenues and passenger loads, but the number of seats being filed per flight isn’t enough to lift Singapore Airlines Group profits.
On Thursday (16 May 2019, Singapore Time, GMT/TUC +08:00), the Singapore Airlines Group reported that their profits dipped by 47.5%.
The main suspect of the drop-in profits was the rising cost of fuel. Singapore Airlines reported that their fuel cost rose by $285 million and as well as the cost of preparing for the Singapore Airlines and SilkAir merger. Other factors speculated to have caused the profit loss are the grounding of the Boeing 737 Max aircraft worldwide and the issues with the Rolls-Royce Trent 1000 TEN Engines powering the Boeing 787-10. These two factors may have affected Singapore Airlines Group passenger capacity growth as the group have to pull several aircraft out of service.
Singapore Airlines currently do not operate any Boeing 737 Max Aircraft, but SilkAir, the regional wing of Singapore Airlines, currently operates 6 Boeing 737 Max 8 (which have been grounded) with 31 more 737 Max 8 awaiting delivery. The grounding not only affected SilkAir’s passenger growth but also the SilkAir agreement to transfer their Boeing 737-800 to Scoot, a subsidiary
of Singapore Airlines. Thus, the grounding of the Boeing 737 Max 8 may have
played a part in the negative results reported by the Singapore Airlines Group.