When a co cuts corners

And people die (Remember the pair of deadly crashes in 2018 and 2019? And a senior Boeing executive putting the blame on third-world pilots?) or could die (Remember the door incident?)

When luxuries are priced for plebs

Airbus rules OK

SIA: I’m not the only idiot LOL

After writing Why I should have sold my SIA shares when it was above $7.80+ in June, I remembered why I didn’t think of selling my SIA shares in June or July.

At the end of June

Singapore’s state investor Temasek is selling around S$400 million ($295.92 million) worth of shares, or a 1.85% stake, in the country’s national carrier Singapore Airlines (SIA), according to a term sheet seen by Reuters on Wednesday.

The shares are priced between S$7.202 and S$7.283 per share, the sheet shows, representing a 2.89% and 3.97% discount to the last close of S$7.50 on Wednesday.

https://sg.finance.yahoo.com/news/temasek-sells-1-85-stake-121014367.html

Why I should have sold my SIA shares when it was above $7.80+ in June

It’s now around $6.60.

Thank you Ho Ching

Luxury goods: winners and losers

French luxury stocks are on a roll. But so have the cruise stocks.

I’ll hang on to my SIA shares: SIA is soaring because Thanks Ho Ching.

SIA is soaring

Thanks Ho Ching

Why I’m still not selling the SIA shares that I acquired in a rights issue in 2020 at $3. It depends on premium passengers.

Keep on doing Temasek specials, Temasek: massive rights issue at huge discounts to current prices. It benefits long term shareholders whose cost is very low.

Btw, results out today.

SIA’s pretty small

Thank you Ho Ching for the rights issue in 2020.

Vote wisely.

Changi Int’l regains crown

Eat your heart out, the anri-PAP S’porean who thinks Japan tua kee. LOL.

Revenge travel

Further to SIA & Ho Ching (cont’d), here’s why the skies are bright airlines, hotels and touristy places like Bali and S’pore.

But don’t go cruising: Why going cruising is still a bad idea

SIA & Ho Ching (cont’d)

Further to Thank you Ho Ching, here’s how SIA has performed compared to Cathay. And its declared a dividend of 10 cents a share.

Thank you Ho Ching

SIA redeems outstanding zero coupon MCBs worth $3.5 bil

Edge magazine headline

reminded me that she retired from Temasek on 1 November last year.

It also reminded me that my mum and I made decent $ on SIA shares and MCBs.

My mum once had 900+ SIA shares. Why this odd number I don’t know and neither does she. It’s been there for decades.

Anyway I never got round to selling this when she transferred her shares to me for me to manage a few years ago. She’ll be 99 next year.

So when 2020 came and SIA did a “Temasek Special” (Massive and deeply discounted rights issue), I applied for excess shares and MCBs. Ended up with 3,000 shares and 3,000 MCBs.

(Applying was a massive headache because I had to use PayNow. But it was Covid time, so no-one to blame except self for being unfamiliar with this payment mode. First and last time I used it.)

And in 2021, we got another 6,000 MCBs.

I’ll get round to selling the SIA shares one day soon. And buy into SATs. There’s another pending Temasek Special that is upsetting minority shareholders.

Meanwhile an additional $3,000+ to pay for the groceries. There’ll be $100 early next from the PAP govt using our money.

Asean airlines ranked

SATS: Temasek gives away another free lunch?

Big opportunity to make serious money by buying into SATS if they have rights issue.

Buy “small” amount of shares cum and apply for excess (lots).

Those who did this for SIA and Semb Marine (last round) still sitting on good profits if they didn’t cash out already.

Temasek usually prices its rights “right” to make easy $, post rights for those buying into its rights issues.

But it got it wrong in earlier Semb Marine rights.

But whoever said share investing is riskless is an idiot.

Be safe, don’t fly Jetstar

It’s a surprise that none of its planes have fallen from the skies.

Very suay:

“Unfortunately, our Boeing 787 fleet has been impacted by a number of issues, including a lightning strike, a bird strike, damage from an item on the runway and delays sourcing a specific spare part for one of our aircraft due to global supply chain challenges.”

https://www.bbc.com/news/business-62803222

So far it and those using it has been lucky. It only had to cancel eight return flights to Sydney and Melbourne from Denpasar (Bali) since 1 September, affecting about 4,000 passengers. They received an apology and free accommodation.

SIA losses in global context

Too bad Cathay’s losses not in table

I’ve oversubscribed for the rights share and bond issues. Not complaining.

Mkts: A note of caution

It is inching up this week.

Why SIA and other airlines, and tourist centric businesses need to donate US$50bn ASAP

Only US$50bn needed to reopen world by mid 2022

The covid-19 pandemic could be ended by mid-2022, if donor countries were willing to cough up a combined $50bn, according to the International Monetary Fund. The sum is the estimated cost of vaccinating 60% of the world’s population. It pales in comparison with the $16trn that governments have already spent supporting people and businesses during the pandemic.

Economist

Why oil prices will crash again/ Why SIA is a “sell”

If OPEC is not careful, oil prices will crash again. A full global revival in oil consumption won’t come until jet fuel demand also recovers.

Meanwhile, American wildcatters are shouting “Drill baby drill”.

Coming back to aviation oil usage

UOBKH downgrades SIA to ‘sell’ as it is ‘less optimistic’ of a traffic recovery by 3Q21

https://www.theedgesingapore.com/capital/brokers-calls/uobkh-downgrades-sia-sell-it-less-optimistic-traffic-recovery-3q21

The truth about SIA food

S’poreans are prepared to pay and pay (up to $4948 for a home delivery) to try SIA’s food.

I hope they enjoy the reheated food that is factory manufactured because that’s what all airline meals are.

They may be designed by a top chef, but they are produced in a factory (OK, OK massive kitchen), then put in cold storage and reheated before meal time.

Here’s more

Ready-to-eat meals that can be kept for 6-24 months part of S$25m investment by SATS to produce more, cut waste

BT headline. More at https://www.businesstimes.com.sg/companies-markets/ready-to-eat-meals-that-can-be-kept-for-6-24-months-part-of-s25m-investment-by

Xia suay: Must be SIA’s website not working again

(Update on 17 May at 6.00am: SIA’s rights issue application website still not working. WTF. Want shareholders to die of Covid-19 isit?)

What’s the point of setting up a website for shareholders to apply for the SIA rights issue (there’s a Covid-19 pandemic raging thru FT dorms many of whom flew here via its cattle class: It’s a Great Way to Fly), encouraging people to use it, and then making it non function-able?

I cannot even scroll the “consent” form or press “submit” to access the site: https://www.singaporeair.com/rights/intro

What a lot of BS. Juz like DBS: DBS: Some things never change, bad service is a given

HoHoHo: S’pore Auntie gets VD from Virgin

S’pore Auntie should know better than hook-up in a sleazy date with a Oz hot bod that goes by the name of Virgin.

Airline Virgin Australia yesterday confirmed it had entered voluntary administration. It’s Australia’s first big corporate casualty of the Covid-19 pandemic.

SIA has a 20% stake. Other shareholders are Richard Branson’s Virgin Group (10%), Etihad, and China’s HNA and Nanshan Group, each with around 20%.

The airline tried to get an A$1.4bn loan from the Oz govt but was told to bugger off because the shareholders had refused to put more cash into the airline, which is loss-making and has net debt of almost A$5bn (U$3.2bn). Another reason apparently was it wasn’t owned by Australians. The eaters of bats and sheep’s head could go stuff themselves.

The airline is now looking for new buyers and investors.

S’pore Auntie never learns. It had bad sex with Air NZ and Virgin Atlantic: What our MSM doesn’t tell us about Virgin Atlantic.

Which brings me to SIA’s rights issue: SIA: Ang moh and Jap brokers are going to look stupid.

One can only hope the war chest is not wasted away on ang moh hot bods Auntie wants to have sex with.

SIA: Ang moh and Jap brokers are going to look stupid

Look at the price targets for SIA. Basically JPMorgan and Nomura are extrapolating from the theoretical ex-price of $4.40. A dangerous extrapolation given that Temasek holds 55% and is not a seller.

Price targets(From the Edge) :
$6.27 HOLD (CGS-CIMB Research)
$5.54 DOWNGRADE HOLD (Daiwa Securities Research)
$4.00 DOWNGRADE UNDERWEIGHT (JPMorgan Research)
$5.80 HOLD (UOB Kay Hian Research)
$4.34 REDUCE (Nomura Research)
$6.60 DOWNGRADE HOLD (DBS Group Research)

I have an odd lot of 600 shares: don’t know where or how my mum got it. I’ll hold on them and subscribe at the price of $3 for each new share (3 new shares for 2 existing shares) even if the shares rebound to $6.60 (I doubt it’ll rebound to that price before the ex rights date. But it did close at 6.13 on Friday). Note there are also convertible bonds to subscribe for.

Looks like money for jam at this stage.

Will we see S’pore Girl working in hospitals?

Or in polyclinics?

In the UK

Thousands of easyJet and Virgin airline staff are being offered work in the new NHS Nightingale Hospital.

Those who sign up will support nurses and senior clinicians at the coronavirus field hospital in east London, the NHS said.

Virgin Atlantic said furloughed staff who help will be paid through the government retention scheme.

NHS England said many airline staff are first aid trained and already have security clearance.

The workers will be changing beds and performing other non-clinical tasks and helping doctors and nurses working on the wards, the NHS said.

https://www.bbc.com/news/uk-england-london-52085701

Want to die? Fly FlyFirefly?

Singapore has withdrawn the Instrument Landing System (ILS) procedures for Seletar Airport while Malaysia has indefinitely suspended its permanent restricted area over Pasir Gudang, both countries said on Saturday (Apr 6).

Singapore’s Transport Minister Khaw Boon Wan and his Malaysian counterpart Anthony Loke said in a joint statement that the agreement was made “in the spirit of bilateral cooperation”.

…

“With this agreement, the Transport Ministers look forward to FlyFirefly Sdn Bhd’s commencement of flights to Seletar Airport effective April 2019,” they added.

Read more at https://www.channelnewsasia.com/news/singapore/singapore-seletar-airport-ils-malaysia-suspends-pasir-gudang-11418642

Wasn’t ILS introduced because FlyFirefly was going to use the airport? Will Tun or the M’sian transport minister say sorry when a FlyFirefly aircraft crashes, killing passengers and crew? M’sia objected to ILS after Tun and friends came into power.

Changi Airport: an int’l first

Changi Airport will be the world’s largest and most complex airport to adopt a next-generation control tower set-up:

Gone is the traditional wall of glass affording a 360-degree view of runways, taxiways and gleaming jets. In its place is a panoramic digital screen that the Civil Aviation Authority of Singapore says provides a similar perspective. And the staff can see far more than they would with their own eyes. Advanced camera and video-stitching technologies allow tracking, panning, tilting and zooming in on a particular plane or area.

Nikkei Asian Review

More

For months, air traffic controllers and engineers have been holed up in a windowless room at Singapore’s Changi Airport. This is a prototype of the control “tower” of the future.

[…]

The team continues to test the system, which processes a range of digital data to promote efficient air traffic management. If all goes well, Changi will be the world’s largest and most complex airport to adopt this next-generation control tower set-up. The aviation authority is also turning to artificial intelligence to help the airport run smoothly.

Rather die than not arrive on time

Vistara, which is a joint venture between Singapore Airlines and Tata, once had to manage a group of passengers staging a sit-down protest in front of an aeroplane when told their flight would not reach its intended destination because of fog.

FT

SIA enpowers oldies

The u/m NYT Dealbook story reminded me that SIA is also like that. One neighbourhood SIA pilot is 62 (my age). And I know a pri school class mate is still flying for SIA. Nice to know that it’s not only S’pore Aunties that are employed by SIA.

 

The Pilot in the Cockpit? In Japan, He Might Be a Retiree By JONATHAN SOBLE Many retired people in the country have returned to the work force as the population dwindles and jobs go unfilled, including Shigekazu Miyazaki, who is still flying at 65.

“Money talks, BS walks” or “There’s no competition”

Just ask UA, and the PAP and they’ll say “Cost and cenvenience matters more than quality of service”.

[UA] has just had a great month. Of course, there was the odd hiccup. First, the video of a bloodied United passenger being dragged off an overbooked flight for the crime of wanting to stay in the seat he had paid for. Then there was the giant rabbit, en route from London to Chicago to compete for the title of world’s largest bunny, who died in United custody with lawyers alleging the airline put the live beast in a freezer for 16 hours. Then there was the airline’s apology to the Paris-bound passenger who ended up in San Francisco instead. And the flyer whose trip was cancelled after he taped an argument with a United employee.

Yet despite this month of PR disasters, United is doing fine. Better than fine, in fact. The airline announced this week that it had its best month of the year in April, beating all of its main rivals in key metrics.

http://www.economist.com/blogs/gulliver/2017/05/not-cruellest-month

70% of voters are like UA customers? Never mind the danger of getting beaten up (Think Donald Low, Amos Yee and AHJC), detained without trial ( “Marxist conspirators”),  hung (all those drug smugglers), sued (Roy Ngerng, JBJ, Dr Chee etc) and kanna whacked by price rises (S’poreans), the PAP is convenient and “cheap” for the quality provided.

But here’s an alternative view:

Roger Wicker, a Republican senator from Mississippi, had a different explanation: “There’s not enough competition in the industry.”

George Cherian would agree, He has commented on FB that

The PAP’s marketing of democracy and human rights as “bad products” as you put it is only half the story. The other half: the PAP ensures that it operates in a protected market where those selling the competing product are “taxed” practically out of existence, by placing obstacles in their ability to organise, and destroying careers of activists. It’s not because there aren’t “good marketeers” among Singaporeans who care about these issues. It’s because they are in a market completely different from the example you cite.

What do u think?

(Related article explaining what Cherian was referring to)

Riposte to Calvin Cheng’s defence of UA

Calvin Cheng the wannabe killer of the babies of IS terrorists has defended UA’s actions because he says it’s in contract between the airline and passenger that the passenger can be ejected by force.

Well for starters the CEO of UA now disagrees that the passenger should have been ejected by force.

When asked on tv if the passenger, Dr Dao, was in any way to blame, Mr Munoz said“No. He can’t be. He was a paying passenger sitting on our seat in our aircraft and no one should be treated that way. Period.”

And the following is what an FT reader says:

The policy for these situations if simply wrong. The plane wasn’t overbooked, United just decided to put four of their employees on the flight. The excuse that they needed to get to Louisville to avoid having to cancel a flight from there.

They could have raised their offer until someone took it. This was their business decision and they should pay for it. They could have put their employees on a flight with another airline for less than the cost of paying the bumping mandatory compensation. The could have put their employees in a limo and driven Chicago to Louisville, airport to airport, driving on all interstates in less than 4 hours without driving over 65MPH, and this incident overall apparently took over 3 hours to unfold.. They had any number of viable alternatives but chose to manhandle and drag a 69 year old doctor off the plane. Someone who had patients whose health may have depended on their seeing him.

I hope the cybernuts rethink their view that any other airline is better than SIA. I hear Goh Meng Seng doesn’t fly SIA or any of its subsidaries for this reason. But most probably, he says this, because he can’t afford the fares.

S’pore angle in major UK corruption case?

Rolls-Royce admitted last week a series of bribery and corruption offences around the world (some going back decades) as part of a £671m settlement with the UK, US and Brazilian authorities. In SE Asia, Garuda, AirAsia and Thai executives at the time have been implicated. In Indonesis, the govt has announced an investigation against previous management.

So it is interesting to read in today’s FT that

Singapore’s Corrupt Practices Investigations Bureau said that it was “working closely with the relevant authorities” in connection with the investigation into Rolls-Royce.

Does this mean SIA executives are being investigated?

Get in the case Terry’s Online Channel.

Avoid this Asean airport

Part of the ceiling at a terminal at Ninoy Aquino collapsed on passengers earlier this year, while just this month thousands of travellers were stranded and left in the dark for hours due to a blackout. The government has said that Manila will have to wait two decades for a new airport, which may be part funded by Japan’s aid agency.

FT

AirAsia is tua kee

It’s one one in three of these markets

Why London and Dubai are better air hubs

It’s geography, not because as TRE nuts claim, S’pore is run by the PAP:

Despite the excellence of equatorial Singapore’s airline and airport, the city-state has limited potential as a hub because the territory that cannot easily be reached nonstop is the American continent.

Singapore Airlines abandoned direct flights to the US after failing to attract enough premium business to make an 18-hour or so flight profitable, though it announced plans last year to revive the service. From New York, aircraft struggle to reach southern Africa and, more significantly, Southeast Asia.

But, from western Europe, Australia and New Zealand are the only major destinations out of reach. From the Gulf you can get to almost everywhere. That is why Dubai and London are among the world’s busiest international airports.

FT’s John Kay. Emphasis mine.

Only in M’sia

Hindus own Sharia compliant airline

Indian media reports say the airline’s founders, Ravi Alagendrran and his wife Karthiyani Govindan, are Hindus, though this could not be independently confirmed.

http://www.bbc.com/news/world-asia-35173710

Tiger shareholders related to scholar Eng & ministers?

Remember scholar Eng and that blind gal with a guide dog?

Some Tiger shareholders feel that they are entitled as these spoled brats isit? They think they like PAP ministers isit?

The Securities Investors Association Singapore (SIAS) said in the open letter dated Dec 18 that some Tigerair minority shareholders felt SIA’s offer was “not reasonable”.

The reason for this, Mr Gerald, president of SIAS, was that shareholders who bought Tigerair shares during its initial public offering in 2010 at S$1.50 a share and subscribed to all three rights issues since then would have paid an average of S$0.67 a share. The takeover price is 0,41

Maybank Kim Eng Securities, the independent financial adviser appointed by Tigerair’s independent directors, advised shareholders to accept SIA’s offer, saying the deal is “fair and reasonable”

But because they’hh lose money, these shareholders think that the offer is “unreasonable”.

WTF.

 

SIA: Cleared of EU fixing charge

Europe’s second-highest court has backed a challenge by 11 airlines against an €800m (£583m) European Commission freight cartel fine.

The General Court of the European Union said there were “internal inconsistencies” in the Commission’s 2010 decision.

Of the firms, Air France was fined the largest amount – €182.9m – while KLM was fined €127.2m.

The two carriers merged to form Air France-KLM in 2004.

Other carriers involved were Air Canada, Martinair, British Airways, Cargolux, Cathay Pacific Airways, Japan Airlines, LAN Chile, Qantas, SAS and Singapore Airlines.

http://www.bbc.com/news/business-35111824

KL airport that cock meh?

Two cock-ups by KL airport

The South China Morning Post reports that Kuala Lumpur International Airport (KLIA) in Malaysia has just come across three ancient 747s that have been sitting on its tarmac for over a year. It says it has no idea who left them there.

…

What is most surprising about this story, other than the chutzpah of the 747s’ owner, is that KLIA can’t trace the operators. All aircraft are supposed to be logged with a national authority, so one wouldn’t think it could be that hard. The Post says that the airport has contacted a “so-called owner” without response. Malaysians now know where to head next time they have an old banger to dispose of.

Economist blog

The latest is that

An air cargo company in Malaysia says it owns three Boeing 747 jets which officials said were left unclaimed at Kuala Lumpur airport.

Swift Air Cargo says it has been trying to retrieve them, but Malaysia Airports disputes its paperwork.

Only in M’sia. After all this is country where the PM refuses to disclose who deposited US$700m, and where he can still remain PM.

Noble House, AirAsia, CEOs, spin meisters take note

My eyes rolled when I read the CEOs of above two cos recently said that their cos follow the accounting rules. (Remember, credible doubts have arisen over whether their accouting reflects their financial position.)

The best riposte to “We follow the accouting rules” came recently when an ex-convict recently addressed a FT conference.

“There may be a fundamental difference between a company following the rules and a company presenting a true picture of its financial position,” said Andrew Fastow, the infamous treasurer of the even more infamous Enron, to a FT conference.

Or as he puts in another way, that it’s possible for a company to comply with accounting standards while at the same time painting a misleading picture of its real financials.

I tot it tragically funny when he said he went to prison partly for doing things that got him a best CFO award: innovative off-book entities.

 

 

Another week, another Noble Bahru?

Debt of 11.5 billion ringgit ($3.1 billion) is already uncomfortably high for an outfit expected to make 1.9 billion ringgit in EBITDA this year. AirAsia’s part-owned sister airlines, especially in Indonesia and the Philippines, owe it increasing sums: amounts due from associates were nearly 2.5 billion ringgit at the end of 2014.

The gloomy case, as made by Hong Kong’s GMT Research, is that this cannot last. AirAsia is booking profits from affiliates that it cannot collect. While restrictions on foreign ownership mean it is only a minority shareholder, it effectively controls these airlines and should consolidate their accounts. Facing up to reality would force a big equity issue.

AirAsia counters that its accounts are transparent, debt is coming down, and cheap fuel and reduced competition should make for a “very good year”. Selling and leasing back planes will help cut debt. It’s also planning to publish pro-forma consolidated accounts.

Fernandes says local partners in Indonesia and the Philippines will each inject over $80 million of fresh equity, and both units will sell $100 million-plus of convertible bonds, before floating in 2017. Some of this will be used to pay back sums owed to the parent.

Well, perhaps. But new investors in the affiliates will need to be comfortable with much of their cash going to repay debts, while also believing in a bright future for these units. As HSBC analysts note, both are sub-scale and face powerful local rivals in Lion Air and Cebu Air.

http://blogs.reuters.com/breakingviews/2015/06/18/airasia-takes-multi-stop-route-to-capital-raising/

The real moral of the stories of Noble and AirAsia is that when one makes money or is in fashion, no-one cares about accounting details, But when the fashion changes, or one loses money, the daggers come out and the hyenas and vultures circle.

And don’t like a lost co, set up a website and slime away

SIA: Sweet spot in costs, safety and efficiency?

TRE and its anti-PAP cybernut posters are cheerfully running down SIA because it is ranked 29 in safety terms below even Chinese air;ines

Why always running down S’porean co and seeing Chinese cos no ak?

Given its safety record (when was last time anybody died in SIA crash?) It may have found the sweet spot between costs, safety and efficiency?

And btw, since when have TRE posters (Chris K excepted) been able to afford to fly. Going by their comments about public tpt fares, they can’t even afford to travel by bus.

Chris K:

April 7, 2015 at 8:01 am  (Quote)

Cynical Investor:
Why always running down S’poreanco and seeing Chinese cos no ak?

Given is safety record (when was last time anybody died in SIA crash?) It may have found the sweet spot between costs, safety and efficiency?

Really? If that is so, how come No.1 ranked Cathay Pacific is more profitable than SIA? Me thinks the disgraceful way SIA treats its frequent flyers is the reason it is falling behind. Have now gone with One World (Cathay and BA) – ended my 15 year Gold membership at SIA recently.

Rating: +11 (from 15 votes)

I’ve not compared the two in yrs because I don’t invest in airlines; so I can’t comment on Chris K’s retort. Save that he would be wrong if SIA’s margins are better.

And anway, I note he was on SIA’s frequent flyer programme until recently. A true blue s’porean. Waz he doing among the TRE ranters and losers?

 

Better not fly on any Thai airline?

Thailand’s aviation sector is under scrutiny after an international safety audit led to a ban on new flights to China, Japan and South Korea.

Last week the International Civil Aviation Organization (ICAO) issued an alert flagging “concerns relating to air operator certification procedures”.

…

Last week the ICAO issued an alert which triggered increased physical inspections of aircraft operated by Thai airlines serving existing routes to countries such as Australia and Singapore, a regional air hub, as well as a ban on airlines expanding their services.

http://www.bbc.com/news/business-32126817

Fly SIA and associates. Don’t be cheap skate! Can die die if fly Thai. ))))

Update at 5.30am

From CNA on Thurday

The surveillance and ramp inspections of Thai carriers’ aircraft operations in the Republic have been stepped up, said the Civil Aviation Authority of Singapore (CAAS) in a news release on Thursday (Apr 2).

Its statement came after the International Civil Aviation Organisation(ICAO) reported “significant safety concerns” in Thai carriers earlier in the year. The Thai government has since said it would urgently improve airline safety in the country.

CAAS added it has not imposed any restrictions on Thai airlines. This is unlike other countries like Japan, who blocked new flights from Thailand last week – a move which affected charter services by budget carriers such as Thai AirAsia X and NokScoot.

In the release, CAAS said it has in place a Foreign Operators Surveillance Programme (FOSP), under which foreign carriers are required to have an Operations Permit from CAAS to operate in Singapore.

The release said that CAAS evaluates an application for an Operations Permit “using a risk-based methodology”, which takes into consideration factors such as the safety oversight capability of the State of Operator, the operational capability of the carrier and the safety records of the aircraft.

“In assessing a foreign carrier’s operations, CAAS takes into consideration safety information from other aviation authorities including the outcomes of the inspections or audits they conduct,” it added.

“CAAS also conducts periodic ramp inspections on the foreign carrier’s aircraft when they are in Singapore; the frequency of which is dependent on CAAS’ assessment of the carrier.”

The regulator assured that any major deficiencies found in the ramp inspections have to be addressed by the carrier for it to continue operations in Singapore.

Auntie’s still a “Great Way to Fly”

Despite aging body etc.

No not Auntie Sylvia (Quah Kim Song finds her a stunner) but S’pore Auntie: she’s still there in top 10 as is her rival Cathay. Keep on cursing anti-PAP paper warriors.

Tiger: When to buy?

This dog has fleas on its fleas. But it bears keeping track of if it cuts its prices steeply relative to the airlines, and complaints pile up. This may never happen given that SIA is it’s parent and may not want to have its reputation for service being tarnished, albeit at a distance.

AMERICANS claim they loathe Spirit Airlines, the discount carrier that earned the worst possible scores in all six of Consumer Reports’ airline-ranking subcategories last year. But the company’s financials show that people, mystifyingly, keep flying on Spirit.

…

“The customers we seek to attract overwhelmingly ranked total price as the most important variable when choosing an airline,” Ben Baldanza, Spirit’s boss told investors earlier this week. Given its abysmal customer-satisfaction scores, some of the customers it attracts probably never fly it again. But some do—and as long as the company can keep prices low (in part by charging added fees for just about everything), it can keep attracting new customers who feel compelled to save money.

http://www.economist.com/blogs/gulliver/2014/11/spirit-airlines

SIA boleh, MAS tak boleh

Malaysia Airlines’ 19,500 staff operate a fleet of 108 aircraft, while SIA operates 103 aircraft with 5,000 fewer employees. The result is that over the past nine years the Malaysian carrier has lost a net Rm3.56bn ($1.1bn), while Singapore Airlines has made S$8.86bn ($7.1bn) without a single year of losses.

Says a lot about how S’pore Inc and M’sia Inc do things.

 

MAS tragedy: SIA attacked by anti-PAP cyber warriors?

Really I can’t see why SIA was attacked for saying on Facebook and Twitter that its flights were not using Ukraine airspace.

Reuters reported: That triggered a flood of angry responses, with many lambasting SIA for not offering condolences to the victims’ families and for mounting what some perceived as a publicity stunt during a crisis involving its neighboring country’s flagship airline.

http://www.reuters.com/article/2014/07/19/us-ukraine-crisis-singapore-air-idUSKBN0FO0UF20140719

Anyway SIA did the pragmatic thing by apologising and rewording its messages. No pointing rowing with loonies, something PM Lee should learn. https://atans1.wordpress.com/2014/07/11/how-pm-roy-can-resolve-matters-satisfactorily-roysw-defence-work-in-progress/

 

SIA plane juz 17km away

The Daily Mail reports that, despite the conflict, the flight path was fairly crowded with a Heathrow-bound Virgin Atlantic jet and a Singapore Airlines plane both over Ukraine at the moment flight MH17 crashed.

The paper says the Singapore jet was just 17 miles away from the doomed flight.

One of the as-yet unknown questions, is why flight MH17 came to be flying over a conflict zone in which a number of aircraft had been shot down recently, the Daily Telegraph says.

MAS polot didn’t want to divert

The paper reports that a number of airlines, including British Airways, easyJet and Qantas had already changed flight routes to avoid the area, although Malaysia Airlines said there had been “no obvious reasons” to avoid the area.

Nonetheless, the paper says, flight path analysis suggested that other Malaysia planes had skirted the conflict zone, by flying south of the area.

The Telegraph says an expert from the Royal United Services Institute has learned the pilot of the downed flight decided not to change course after apparently telling air traffic controllers he “felt uncomfortable” over the diversion.

Extract from BBC

 

Why MAS really suay cont’d

According to Flight radar24, which monitors live flight paths, the airlines that most frequently flew over Donetsk in eastern Ukraine in the last week were: Aeroflot 86 (flights), Singapore Airlines 75, Ukraine International Airlines 62, Lufthansa 56, and Malaysian 48. It was not necessarily a risky approach. The chance of a rocket reaching above 32,000 feet was considered remote, says Sylvia Spruck Wrigley, author of Why Planes Crash.(Part of BBC report: see pix of flight routrs taken http://www.bbc.com/news/blogs-magazine-monitor-28364306 )

SIA flew 56% more flights thru Eastern Ukraine than MAS, yet it was a MAS jet that waz shot down .

SIA employs better bomohs?

 

MAS pilot slightly off planned course

“But although the aircraft was reportedly a few hundred miles north of its planned course to avoid a thunderstorm, its altitude should have marked it as a passenger plane,” reported an Economist blog.

Not seen this in any other report.[Update on 20th July at 10.15 am http://www.theguardian.com/world/2014/jul/19/mh17-changing-course-storms-pilot?guni=Keyword:news-grid%20main-1%20Main%20trailblock:Editable%20trailblock%20-%20news:Position1:sublinks ]

MAS is suay. Time for Najib to call in the bomohs to “buang suay”.

The two events that hit it and its passengers these yrs were really freak events.

Whatever it is fly SIA. Only TRE born losers will refuse to fly SIA. Die-die fly other airlines, even if die as a result.

 

Asean travellers, KS, security conscious? Use Changi Int’l

Home Team’s Immigration and Checkpoints Authority has been in the sights of DPM Teo and netizens (a rare distinction: err where’s the co-driver?) for a series of recent balls-up. So the tragic disappearance of a MAS plane gave its PR team an opportunity to blow its trumpet, (justifiably, no BS or hype)

Visitor passports presented to immigration officers at Singapore checkpoints are screened against Interpol’s database of lost or stolen travel documents, said the Immigration and Checkpoints Authority (ICA) on Tuesday.

And if a passport is one of more than 40 million on Interpol’s list, the officer is automatically alerted and the traveller pulled aside for further checks.

This procedure has been in place since May 2008, an ICA spokesman told The Straits Times.

He did not elaborate on how the system works, but security experts said that this verification typically takes just a few seconds.

But despite the fact that checks are quick, Singapore remains one of only a few countries that use Interpol’s database to ensure border security, experts noted. (Wed ST)

EDB, and the tourism board should be following this up with a regional advertising campaign:

“Taking a flight of more than an hr? Transit via S’pore: all passports are checked against Interpol’s database of lost or stolen passports. Does yr airport do this? Or are they like KL?”

BTW, a gd riposte to the M’sian Home Affairs minister’s comments

“I am still perturbed. Can’t these immigration officials think? Italian and Austrian (passport holders) but with Asian faces,” he was quoted as saying late on Sunday.,

would be for immigration officers will say that they use to seeing Chinese and Indian faces on MALAYsian passports. So no issues about seeing Asian faces on European passports.

Seriously comment shows he has prejudices, hangups or is still living in the mid 20th century.

Temasek tales: TLC overpaid?/ Olam: Cheong?/ Won’t read this in TRE, TOC?

Changi Airport Group: Winner’s curse?

The Aeroportos do Futuro group led by Odebrecht SA, and including Singapore airport operator Changi Airport Group, offered 19 billion reais (US$8.3 billion) and won the right to run Galeao airport in Rio de Janeiro, which will host tourists for the soccer World Cup next year and the 2016 Olympic Games, for 25 years. The consortium offered nearly four times the minimum bid for the right to operate Rio’s Galeão airport for the next 25 years.

We will only know the consortium overpaid if we know the next highest bid. Will let you know if this info is made public in Brazil )))

Last chance to buy Olam?

More bull points to add to this:

— When Olam released its quarterly results in early November, it showed it  had generated positive free cash flow – the first time in four years for a seasonally weak quarter.

Its executive director of finance and business development A Shekhar told analysts and reporters: “We’re very pleased that we’re striking the right notes on both objectives of profit growth as well as free cash-flow generation.”

— Ang mohs are still sceptical about the parts of the stock’s biz model.

— But they bulls on Africa and Olam got an edge there. Africa is now seen a destination mkt, not juz an exporter of commodities i.e. origination mkt:

The commodities houses are attracted to the African destination business for three reasons. First, demand is rising fast, in many cases at double-digit annual rates. Second, many African governments subsidise basic commodities such as petrol and wheat, in effect guaranteeing a return to the traders. Third, most African countries lack the infrastructure needed to import raw materials, from silos for storing wheat and rice to terminals for unloading petrol. The commodities houses say that, as they build this infrastructure, they will be able to secure a market and benefit from years of rising demand. (FT report on Africa dated 10 November 2013)

Even Chris Balding flies SIA

Would the Temasek model help improve the efficiency of China’s state-owned enterprises? Only one (Singapore Airlines) or possibly two (DBS bank) of Temasek’s GLCs have established themselves as international brands, according to critics such as Chris Balding of Peking University*. SingTel has made successful foreign acquisitions, but other GLCs have fared less well. STATS ChipPAC, a semiconductor firm, lost money in the second quarter of this year, as a result of the costs of closing a factory in Malaysia.

The few academic studies of Singapore’s GLCs are more encouraging, however. A 2004 article by Carlos Ramirez of George Mason University and Ling Hui Tan of the IMF showed that the country’s GLCs enjoyed a higher market value, relative to the book value of their assets, than comparable private firms. They also generated a higher return on assets, on average.

In judging the performance of Temasek’s GLCs, the counterfactual is important. They may not be as obviously successful as private titans from the region such as Samsung or LG. But they are not nearly as bad as most SOEs, including China’s. The enthusiasm for reform of SOEs in China reflects their deteriorating returns and accumulating debt. According to M.K. Tang of Goldman Sachs, their return on assets was 6.5 percentage points below that of other Chinese firms in 2012 and their shares trade at a growing discount. Even Mr Balding, meanwhile, is happy to fly Singapore Airlines.

http://www.economist.com/news/finance-and-economics/21590562-chinas-rulers-look-singapore-tips-portfolio-management-soe-glc

—

*Cock Balding forgets Keppel and SembCorp in rigbuilding. More on these two cos later this week.

Costs savings in airlines: every little bit counts

Singapore Airlines (SIA) has reported a 78% rise in net profit for its second quarter*.

This reminded of a story in the New York Times, some time back, that Delta Airlines by slicing an ounce off its on-board steaks saved US$250,000. It even calculated that removing a single strawberry from its First Class salads would save US$210,000.

Talking after looking after the pennies, and the dollars will look after themselves.

In investing, John Bogle, the founder of indexer Vanguard, keeps stressing the importance of buying funds that charge low fees. The expenses saved when compounded over time adds to performance. Besides most active fund mgrs underperform the market., so they mare a waste of money. Indexers charge very little in comparison with active managers.

Related posts:

The Perils of Indexation (Revised and Updated)

Even the rich should use index funds

Rebalancing can lock-in profits, trim losses

 

——–

*Asia’s second biggest carrier was boosted by the sale of aircraft, spare engines as well as increased passenger traffic.

The firm posted a total net profit of $128.6m (£80.9m) for the quarter, up from $72.1m a year earlier.

But it warned it was facing tough competition and a strong Singapore dollar. (BBC report)

Asean round-up

Airbus has won a record order for 234 A320 planes worth 18.4bn euros (US$24bn) from Indonesia’s Lion Air.The order trumps last year’s record order for 230 Boeing planes – also from Lion Air.

Last Saturday, Bloomberry Resorts Corp’s was opened by Philippine President Benigno Aquino.

Big casino operators will be scrutinising the Philippines’ debut as Asia’s newest top-end gambling destination this weekend to see if Manila can deliver on promises of better profit margins and lower costs than global betting capital Macau, says Reuters.

They also want to know whether Bloomberry Resorts Corp , whose shares have climbed 40% in the last six months on hopes of quick returns, can overcome national security concerns and flawed infrastructure to bring in VIPs from China to place bets at its US$1.2 billion Solaire casino resort.

Its rivals are Melco Crown Entertainment Ltd and Genting Hong Kong Ltd, with their respective local partners Belle Corp and Alliance Global Group Inc.

“There are high rollers coming in to play … I am expecting at least 1-1.5 billion pesos (US$25 million to US$37 million) to be wagered tomorrow night,” Cristino Naguiat, head of local regulator the Philippine Gaming Corp (Pagcor) told reporters.

The advantage that the Philippines has is that junket operators are welcomed, unlike in S’pore. Junket operators have a reputation for laundering money, and ties with organised crime.

Bangkok skytrain operator BTS Group Holdings Pcl has received commitments worth $850 million from 20 cornerstone investors for Thailand’s biggest initial public offering, a source with direct knowledge of the plans told Reuters on Friday.

The investors in the infrastructure fund IPO include insurer AIA Group Ltd, hedge fund Azentus Capital Management and global asset managers Fidelity and Capital Research and Management, added the source, who was not authorized to speak publicly on the matter.

BTS on Friday week filed a prospectus for the up to $2.1 billion IPO, but the document did not include the names of the cornerstones.

The fund will likely yield between 6-6.2%, Reuters reported.

PT Matahari Department Store (LPPF)’s owners raised 12.7 trillion rupiah (US$1.3 billion) selling stock in the Indonesian retailer, Bloomberg reported.

CVC and Lippo Group sold 1.167 billion shares at 10,850 rupiah. The shares were initially offered at 10,000 rupiah to 11,250 rupiiah

The sellers, seeking to capitalize on investor optimism about consumer spending in Indonesia, asked for as much as double the median valuation among department stores in emerging Asia, price-to-earnings data compiled by Bloomberg show T(he shares were offered for as much as 28 times Matahari’s forecast 2013 earnings). Jakarta’s stock benchmark is up 11.3 percent this year and hit a record high earlier this month.

Temasek GIC is a cornerstone investor despite selling some shares too.GIC also committed to buy a 1.8% stake in the share sale as a cornerstone investor at the same time as its private equity arm was one of the main selling shareholders. Temasek too was a cornerstone investor. There were 15 cornerstone investors each with less than 5%.

(Update: Last para amended and expanded on 24 March 2013.

Asean round-up

The Mitsubishi UFJ Financial Group “is among banks considering a purchase of TPG Capital’s $1.6 billion stake in Indonesia’s PT Bank Tabungan Pensiunan Nasional, two people with knowledge of the matter said,” Bloomberg News reports.

• BLOOMBERG NEWS

A bid by Malaysian low-cost carrier, AirAsia, to set up an airline in India has won approval from the Indian government.

It would be the first foreign company to try to capture the rising demand in India’s aviation sector.

AirAsia India would be a joint venture with the well-known Tata Group, based in Chennai in South India.

India’s aviation industry, which has suffered major losses, was opened to foreign investment last year.

The government now allows foreign companies to own up to 49% of a local airline.

AirAsia, which is Asia’s largest low-cost carrier, will make an initial investment of 800m rupees ($15m; £10m) and will own 49% of the new airline, while Tata Sons will have a 30% stake. Part of BBC report

AirAsia is eating SIA’s lunch

(And that of every other Asian legacy airline like Cathay, Qantas, Thai and MAS)

When SIA sold to Delta its 49% stake in Virgin Atlantic for US$360, which it has owned since 1999, it said it was selling because of increased competition in its local market, where it wants to keep its focus.

In the same week, last week, AirAsia announced a US$9bn order for 100 A320 planes. AirAsias’s order is for 64 of the A320neo (new engine option) and 36 of the A320ceo (current engine option) aircraft.

M’sia Boleh!

Background info on SIA sale, so I don’t get dumb comments

http://in.reuters.com/article/2012/12/11/singaporeairlines-virgin-sale-idINDEE8BA09V20121211

http://www.bbc.co.uk/news/business-20576420

What our MSM doesn’t tell us about Virgin Atlantic

It’s in crisis. Deep crisis.

Auntie’s still a great way to fly but its record in investing in other airlines is horrible: think NZ Air.

And now the Arab airlines are stealing its premium customers via slightly better service, and just as good connections via the Gulf hubs. And lower costs: our S’pore Aunties are no longer that cheap. But bit susa to pass of PRC, Pinoy FTs as S’pore Gals. Only M’sians can get away with pretending to be S’poreans.

Good backgrounder (added at 8.50am on day of posting)

S’pore Gal becomes Auntie SIN

VietJetAir, a budget airline. had beauty contestants in bikini-tops dance aboard a plane on its first flight from Ho Chi Minh City to Nha Trang, Tuoi (Waz that?). The airline said it wanted to capture a “holiday atmosphere” for its new flight route to one of the country’s most popular holiday destinations. “Once passengers stepped on board they were met by flight attendants dressed in beach holiday attire [who] performed a sexy Hawaii dance,” it said. BBC article. Authorities were not amused: it was fined for not getting prior approval. Sounds so S’porean, this fine.

Back to the gals in bikini tops: they make S’pore Gal look like auntie:  like SIA falling behind its rivals from the Middle East in the premium business, JetAir and AirAsia in the budget segment.

So rather than juz redesign its cabins and seats, as SIA announced last week, time to replace Auntie and rethink strategy?

Its got the brain power. Senior mgt are SIA veterans. There was an attempt a few yrs ago to put a scholar, ex-general as a senior VP with the aim of making him CEO. He didn’t get the job and disappeared without a trace. Thank God, even though he RI boy, as I got one lot of SIA.

SIA: What our MSM will never tell you

The Air Transport Rating Agency (ATRA) has published its second annual list of the world’s ten safest airlines. The Geneva-based operation based its list on an assessment of 15 factors, using 2010 data.

 SIA has not made it into the top 10 again. This year, its greatest rival, Qantas, made it into the top 10.

ATRA’s ten safest airlines (in alphabetical order only): Air Canada, Air France-KLM, AMR Corporation, Delta Airlines, International Airlines Group, Lufthansa, Qantas, Southwest Airlines, United-Continental, US Airways.

But as the Economist’s travel blog points out:

Only one of the ten airlines in ATRA’s list (Qantas) makes it into the top ten of the most recent Skytrax world airline awards, which are derived from over 18m passenger responses and have a much more Middle Eastern/Asian tone. This either suggests that passengers do not consider safety when naming their favourite carriers, or they disagree with ATRA’s particular emphasis.

Anyway, I’m publicising this rating so that the likes of KennethJ, Chris balding, Dr Chee and his sis, Richard Wan and other TRE staffers and avid readers, TOC editorial staffers and Core Team, xmen and others of their kind, have a good excuse not to patronise SIA. They can fly Qantas instead. Actually, Dr Chee already has a good excuse already: he can’t leave S’pore without permission, and I don’t think permission has ever been given.

SIA: All the fault of previous CEO?

In a posting on SIA’s results, someone in Oz who seems to know the airline biz laid the blame on the previous CEO. I reproduce it because although I know bugger-all abt the airline biz, I know poster was right abt the property sale (can’t remember the dollar values though):

Chew Choon Seng, the previous SIA CEO from 2003 to 2010,sold the SIA building in Singapore for $250 mil, and the new owner sold it away for $550 mil barely 6 months later. He gave ground handling subsidiary SATS to shareholders as an in-specie dividend, thus making millions in the process through this special dividend and losing control of ground handling in his hub.

He barely ordered any aircraft and kept shrinking the airline, in the name of protecting “yields” that he wanted but could never achieve. He introduced an enormous and absolutely space-inefficient business class, and has the lowest density 77W of any airline, as well as the lowest density A380 of any airline (for the all upper-deck business class A380 configuration)

He cut route after route, and refused to acknowledge Emirates as a competitor (which SIA has only done like, yesterday presumably)

Initially, SIA thought they could charge a price premium for those enormous seats, but today they are among the cheapest network carriers out of Australia and Europe in business class. Low density and low fares = disaster for yields

The only thing protecting SIA today is their strong balance sheet, and the fact that they’re sitting on billions of dollars in cash (which they don’t seem to be doing anything with) and no debt – but that was a result of the hard work of the management before Chew Choon Seng.

And the sad thing is, he inherited an airline in 2003 which was unrivalled in terms of profitability, network and inflight product. (Who had heard of Emirates in 2003). The Singapore economy has been booming for the last decade, and tourist arrivals have surged beyond belief. Labour relations in the airline are healthy, their cost base WAS very competitive (without the low density aircraft), and they operate a single hub operation which, compared to QF and other legacy carriers, should theoretically make their operations far more efficient.

They have also had a surging local currency, which should have helped their fuel prices in SGD. (Do note that from 2002 till today, AUD:SGD has been stuck in a 1.20-1.30 range, not withstanding a few months after the Lehman Brothers collapse, so the SGD basically has risen in tandem with the AUD against the USD for the last decade)

And yet SIA has shrunk through the last 10 years. It’s not like they can blame any catastrophe other than themselves for the dismal financial performance last year.

Solution to SIA’s problem of higher fuel costs

US airline buys an oil refinery. Taz thinking out of the box.

Pros and cons

http://www.economist.com/blogs/gulliver/2012/05/delta-air-lines

It’s not as though SIA doesn’t have the cash.

Qantas dispute: What PM and our local MSM are not telling us

Yesterday, a piece in MediaCorp’s freesheet by an NTU academic reminded me of the narrative that the PM and our “constructive”, “nation-building” local media are trying to tell us about the Qantas dispute, strikes, lock-out and all.  It is about a struggling airline trying to cut costs to compete but its unionised workers are prepared to bankrupt it if their demands are not met.

 There is truth to this narrative. What the unions fear most is a plan announced in August that would cut 1,000 jobs and some long-haul routes while setting up a new premium airline based somewhere in Asia and forming a joint venture to operate a low-cost carrier in Japan. The unions want guarantees of job security. Qantas says that these and other demands risk destroying its commercial viability.

What you won’t hear, from the PM or the local media or the NTU academic, is that it could be possible that Qantas could be more generous to the workers, and still remain competitive. 

If the dispute goes to arbitration (what Qantas wants and which is now likely to happen), the eventual ruling may not be in Qantas’s favour overall, Australian analysts are saying. Since its domestic routes are highly profitable, the arbitrator may decide it can afford to be more generous to workers than it claims.

“Trust No One” especially our local reporters and editors, and local academics writing in the local media. But let’s be fair to our local media. Writing before World War II, George Orwell observed, “Early in life I had noticed that no event is ever correctly reported in a newspaper”. He was referring to the British press.

And “The Truth Is Out There”.

SIA & Qantas: Different Strategies

Qantas has unveiled its strategy to meet the competition from low-cost carriers.

What is interesting is that it has taken a different approach from SIA, another legacy airline. SIA is planning to add a low-cost carrier to complement its existing premium and other legacy services. This is a conservative approach but one that risks cannibalising customers from its non-premium legacy services

But Qantas is taking a more aggressive approach. It is turning Qantas into a low-cost carrier with a premium service subsidary that will be based in Asia.