Singapore Airlines

[specuvestor]

SIA competitiveness continues to erode... even Cathay is not spared now. Until SIA Total Recall what was their edge in the first place

"(Bloomberg) --
Asia’s marquee airlines are warning tougher competition is squeezing them.

Singapore Airlines Ltd. said Thursday passenger yields -- a key measure of profitability in the industry -- remain under pressure amid "aggressive capacity injection." Yields declined to their lowest in more than six years in the first quarter. The stock fell 1.6 percent at the start of trading in Singapore Friday.

Earlier this month, Ivan Chu, chief executive officer of Cathay Pacific Airways Ltd., which dominates the Hong Kong financial hub, said there is “intense pressure" on the metric.

The expansion of the Middle East’s ‘Big Three’ -- Emirates, Etihad Airways and Qatar Airways -- and an unprecedented surge by budget airlines in the region is hurting the pricing power of Asian carriers. Singapore Air CEO Goh Choon Phong and his Cathay counterpart Chu have ordered some $20 billion in new aircraft to modernize their fleet and take on their competitors who are offering luxuries like on-board shower and butlers."

Patiently waiting for Open Skies to be in effect.... I think this is also what SIA is waiting for.
Think about it, this is a temporary setback. SIA in the first place should not even be this successful.
We have no domestic destination at all. With the Open Skies agreement, SIA suddenly has alot more destinations to fly to.
A whole host of "domestic" market now.
I hope I am right...slightly optimistic

Yes and no. I don't think this is temporary. SIA was successful because they focused on software and value proposition, when competitors were focusing on cost. Now it's about hardware and bragging rights.

Until management "total recall" they are in service industry, and not just short term reactive or bottomline, I would steer clear of their cluelessness. It is scary when management does not understand their real business or strategic purpose. The frustrating part is that they are strategic to our tourism industry so their cluelessness has extended reach

We are in the phase where Buffett said sooner or later an idiot will run the company. But like I said before, unlike Buffett I won't bet on the moat.

Probably instructive to reread our discussion 20 months ago and see in real time how management missteps can take years to grind a good company into mediocrity

http://www.valuebuddies.com/thread-261-p...l#pid46224

Time is the friend of the wonderful company, the enemy of the mediocre. I do hope for Singapore's sake they get better calibre management that understands what our formula was.