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SINGAPORE: Covid-19 has decimated the Changi Airport business. Compared to pre-pandemic times, the airport is now serving only 1.5% of its usual passenger volume and 17% of the total number of flights.
It has also plummeted to the 58th busiest airport, compared to the seventh, and now has direct flights to just 49 cities in the world.
Revealing these figures yesterday, Transport Minister Ong Ye Kung said in Parliament that global travel restrictions have caused a “deep crisis” for Changi Airport Group (CAG) and national carrier Singapore Airlines (SIA).
Ong said that without the moves made to avoid the worst of this crisis, the effects of the coronavirus would have been much worse. He warned that the coast is far from clear.
SIA has raised about S $ 11 billion in liquidity since the start of the 2020/21 fiscal year in April, through avenues such as a Temasek-backed rights issue, long-term loans secured on some of its aircraft, as well as committed credit lines. and a short-term unsecured loan from financial institutions.
Noting that SIA had posted its biggest quarterly loss on record in the first quarter of fiscal 2020, Ong said it was doing its best to reduce cash spending, preserve its core capabilities and explore all ways to generate income.
He also noted that SIA had to make the difficult decision to cut jobs, but added that through a recently concluded agreement with its pilot union for pilots to make deeper pay cuts, the group managed to reduce the number of layoffs from 2,400 to 2,000. .
“Without the recent major compounding exercise, there would not be an EIS today, but it is far from out of the woods,” Ong said in a ministerial statement on aviation recovery.
One of SIA’s suggestions for generating revenue and getting pilots to fly was to have flights to nowhere, where passengers could pay for scenic trips that would take off and land at the same airport.
Noting that some MPs had asked whether the government would support this, Ong said that this had become a moot point, as SIA had announced that it would scrap this idea late last month.
But he added that the Transport Ministry would always do everything possible to support SIA in times of crisis, and opposed the suggestion to impose an environmental tax on the airline in case the flight had taken off.
“What I will not contemplate is imposing an environmental tax on them at this time because that will only make the SIA crisis worse,” Ong said.
Meanwhile, CAG has also lost sources of revenue, he said.
Shops and restaurants at the airport are also receiving fewer customers, and many of them have closed.
This has caused CAG to draw on its reserves to preserve cash and stay alive.
Terminal 5, which is a large-scale project being carried out by the group, will be halted for two years so that efforts can focus on the pace of recovery of air travel, Ong said.
He added that no effort will be spared to support SIA, CAG and other companies in the aviation sector, noting that the sector benefits from the highest level of support from the government’s Labor Support Program.
Other avenues of help for companies in the industry include cost relief through the Enhanced Aviation Support Package and temporary relocation programs for affected workers.
“The government will continue to support SIA, CAG and other companies in the aviation sector as much as we can,” he said. – ST / ANN
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