Scoot plans to slowly build partnership with Air India Express

Singapore’s budget carrier Scoot Air plans to build its partnership with Air India Express slowly and steadily as the parent companies of both the airlines work on building synergy ahead of Air India-Vistara merger.

“This is relatively new. It is a unilateral thing right now, so you can see Scoot flights on Air India Express website and that will allow them to ticket to the Scoot-beyond destinations with some limitations,” Brian Torrey, general manager-India and West Asia at the low-cost subsidiary of Singapore Airlines, told journalists in New Delhi. “This is a partnership that is developing. If it is more comprehensive, we want to be very clear on how it benefits our customers.”

Earlier this month, Air India Express, an Air India subsidiary, launched a virtual interline platform with Scoot as the inaugural partner. This will enable customers to book flights from India and the Middle East to 60 Scoot destinations across Australia, China, Indonesia, Japan, Laos People's Democratic Republic, Malaysia, Philippines, Republic of Korea, Singapore, Thailand, and Vietnam.

Scoot has a unique link to Air India. The Indian airline's chief executive officer and managing director Campbell Wilson was previously the CEO at Scoot and is among the founding members of the budget carrier born in 2011. Wilson is now spearheading the merger between Air India and Vistara, a 51:49 joint venture between the Tata Sons and Scoot’s parent Singapore Airlines. Once completed, Singapore Airlines is set to hold 25.1% stake in the combined Air India group.

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The aim of offering competitive airfares

Scoot, which counts India as its third largest market after Singapore and China, is now looking at ways to offer competitive airfares to Indian travellers who fly beyond Singapore to other destinations in the airline’s network.

“As we grow the network beyond Singapore and as we become more diverse in terms of what we sell from Indian market into East Asia, we need to have more control over how that pricing shows,” Torrey said. “We have invested in our revenue management process so that we can offer an origin-destination pricing that is unique to a market.”

“So, with these systems upgrade, as we add new destinations, there is unique pricing for the Indian market to go to these destinations--we always want to stay competitive,” he added.

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Fleet expantion

Scoot took to the skies in 2012 and merged with Tigerair Singapore in July 2017. It has a fleet of over 50 aircraft including Boeing B787, Airbus A320neo family aircraft, and two of the recently inducted Embraer E2 aircraft. The airline plans to add two more Embraer E2 aircraft in 2024 and five more of these 112-seater planes by the end of 2025.

The airline has almost recovered its Indian air traffic to pre-covid levels. It carried 192,829 passengers to and from India in January-March, over 99% of the pre-covid level of 193,880 passengers registered during the same period in 2019. However, the traffic in the March quarter of this year was around 5% less than the year-ago level of 202,117 passengers.

“Indian travellers are going off the beaten track. MICE (meetings, incentives, conferences, and exhibitions) group is a very big movement from India; the groups keep getting bigger, they used to be 200 people, now you have groups of 2000 people, they are always looking for new destinations,” Torrey said. “We see growth in leisure travel across age groups. And in the segment of VFR (visiting friends and relatives).”

India opportunity

The low-cost subsidiary of Singapore Airlines currently flies to Amritsar, Coimbatore, Chennai, Trivandrum, Vishakhapatnam, and Tiruchirappalli. The airline also sees potential in several other Indian international airports, including the ones coming up in Jewar and Navi Mumbai, but is currently restricted under the air service agreement.

The air service agreement between India and Singapore was last expanded in 2013, increasing the capacity entitlements for carriers on both sides to 29,400 weekly passenger seats from India for domestic carriers and to 28,700 weekly seats from Singapore for Singaporean airlines. In addition, a memorandum of understanding signed by the two countries in 2006 states that designated Indian and Singaporean airlines will have unlimited access between 18 Indian cities and Singapore. However, Scoot says the agreement needs to be reviewed to accommodate new airports as well.