Third daily Auckland-Singapore flight indicates success for Air New Zealand-Singapore Airlines JV

Air New Zealand and Singapore Airlines (SIA) are boosting capacity on the Auckland-Singapore by 33% as the joint venture partners introduce a third daily flight on the route.

Air NZ and SIA forged a JV in 2014, which resulted in Air NZ resuming flights to Singapore in Jan-2015 following a hiatus of more than eight years. Air NZ and SIA have since each operated one daily flight on Auckland-Singapore.

Air NZ and SIA have unveiled plans to add at a third daily flight on the Auckland-Singapore route from 28-Oct-2018. The additional flight will be operated by SIA during the summer season with a daily 777-300ERs frequency and by Air NZ during the winter season with five weekly 787-9 frequencies. SIA will continue to operate one year-round Auckland flight using A380s in summer and 777-300ERs in winter while Air NZ will continue to operate one daily year-round flight with 787-9s.

Therefore, the new Auckland-Singapore schedule will feature 21 weekly flights in the summer months (seven with SIA A380s, seven with SIA 777-300ERs and seven with Air NZ 787-9s) and 19 weekly flights in the winter months (12 with Air NZ 787-9s and seven with SIA 777-300ERs.) Total one-way weekly seat capacity will increase by 36% to 7,070 seats in the summer compared to only 5,201 seats in the current summer schedule, based on CAPA calculations.

The new summer total of 7,070 weekly one-way seats incorporates SIA introducing the new 471-seat A380 and Air NZ introducing the new 275-seat three-class 787-9. SIA currently operates 441-seat A380s to Auckland but is transitioning its entire A380 fleet to 471-seat aircraft over the next couple of years. Air NZ currently uses 302-seat 787-9s to Singapore but has stated it will begin deploying its new lower density 275-seat 787-9s to Singapore. No change is planned for SIA’s 777-300ERs; 264-seat four-class 777-300ERs are now used to Auckland.

Air NZ took its first 275-seat 787-9 in Oct-2017 and began deploying the type on the Auckland-Houston route in Nov-2017. The new lower density configuration has 57% more premium economy seats and 50% more business class seats but the economy cabin shrinks by 18%. SIA will also be increasing premium economy capacity by 22% and business class capacity by 30% with its new A380; economy class capacity will increase very slightly, by 3%, while first class capacity is cut by 50%.

In the winter schedule, total Auckland-Singapore capacity will increase by 30% to 5,148 weekly one-way seats compared to the current 3,962. Therefore, capacity on a year-round basis will be increasing by approximately one-third, or 33%.

The decision by Air NZ and SIA to increase capacity in the New Zealand-Singapore market indicates the JV has been successful in its first three years.

Air NZ and SIA are the only airlines operating nonstop flights from Auckland to Singapore. Jetstar Airways stopped serving the route in 2014, citing the anticipated impact of the new Air NZ-SIA JV (which was implemented at the beginning of 2015).

The decision by Air NZ and SIA to increase capacity in the New Zealand-Singapore market indicates the JV has been successful in its first three years.

Air NZ has been using Singapore as hub for Europe, Southeast Asia and Asia. The third daily flight on the core Auckland-Singapore route will improve connectivity and result in a further increase in traffic that Air NZ and SIA carry via Singapore.

Local Auckland-Singapore traffic also has grown but is a relatively small segment of the market. New Zealand recorded 58,016 visitors from Singapore in the year ending Nov-2017 compared to 40,544 visitors in the year ending Nov-2013. New Zealand visitor numbers from Singapore have grown at a very modest clip the last four years but is double the size with slightly over 120,000 annual visitors.

SIA also serves Christchurch and Wellington but no increases in capacity are planned in these markets – at least for now. SIA operates three to four weekly flights to Wellington via Canberra using 266-seat 777-200s. SIA serves Christchurch with a daily year-round frequency using 271-seat 777-200ERs; three additional frequencies are operated during peak summer months also using 777-200ERs. The expanded SIA and Air NZ joint venture will offer a combined 35 weekly flights in the New Zealand-Singapore market during peak summer months, providing nearly 11,000 weekly one-way seats.