Singapore Airlines To Impose Fuel Surcharge

Singapore Airlines To Impose Fuel Surcharge

SINGAPORE AIRLINES TO IMPOSE FUEL SURCHARGE ON FLIGHTS FROM NEW ZEALAND

Singapore Airlines will introduce a surcharge on tickets issued for travel on its services from New Zealand to help combat the impact of the steep rise in the price of aviation fuel. The surcharge of US$ 5 per sector will be imposed for travel on tickets issued from Monday 24 May 2004.

The impact on customers, at today’s exchange rates, will be an increase of just under NZ$16 for a return trip from New Zealand to Singapore and NZ$32 for a return trip from New Zealand to points beyond Singapore, including United Kingdom and Europe, on Singapore Airlines and SilkAir services.

In recent months, the price of fuel has risen sharply, and this is having a significant impact on Singapore Airlines’ costs. The airline is budgeting to utilise over 1.4 billion gallons of fuel this financial year: the equivalent of 27.3 million barrels.

The average fuel price in the last financial year (ending 31 March 2004) was already 9% higher than the previous year, at US 89.34 cents per gallon. The current price is 24% higher again than the average for the last financial year, at over 110 cents per gallon.

The increasing price of fuel impacted on Singapore Airlines by adding over $S 134.6 million to the Company’s expenditure during 2003-04. This more-than halved the savings generated by lower fuel consumption resulting from reduced flights as a consequence of the SARS downturn. This year, with schedules returning to pre-SARS levels and increasing in many markets, including New Zealand, Singapore Airlines has had to examine measures to contain those costs.

The cost of fuel is entirely outside the control of the airline, and the only alternative is to now levy a modest surcharge to help cover some of the increasing costs of fuel. This surcharge will not cover the full costs of the increase but go some way toward assisting.

SIA will monitor the price of fuel and review the application of the surcharge on a regular basis.

ENDS

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