SINGAPORE : The search is now on for a name for the new low-cost
terminal at Changi Airport.
The site for the terminal was launched on Wednesday by Transport
Minister Yeo Cheow Tong.
To be ready in about a year, it will serve the growing demand for
low-cost travel into and out of Singapore.
Mr Yeo says the low-cost sector is seeing strong growth and the
potential in Asia is tremendous.
Budget travel in Asia now comprises only 5 percent of the
intra-regional market, compared to 10 percent in Europe, 25 percent
in the US and 40 percent in Australia.
But with ASEAN's 500 million people, and 2.3 billion more in China
and India, intra-Asian air travel may one day overtake even the
US.
In Singapore, Mr Yeo says that as at May 1, low cost carriers
operate 175 weekly services to 15 cities, up from 70 weekly
services in just six months.
This accounts for about 7 percent of Changi's flights, with this
phenomenal growth achieved in just one year.
But low-cost carriers still face many challenges in Asia because
the operating environment in Asia is vastly different from that of
the US or Europe.
First, many Asian cities do not have secondary airports for
low-cost carriers.
Second, low Internet penetration means low-cost carriers have to
provide call centres and rely on travel agencies, thereby
increasing costs.
Third is the regulatory environment.
While some Asian countries have liberalised their aviation markets,
most are still very protective of their air rights.
Notwithstanding these factors, Mr Yeo says the low-cost carrier
phenomenon is here to stay.
Singapore has studied the developments elsewhere and looks forward
to the significant multiplier effects that increased tourism will
have on its economy.
It will continue to actively liberalise its Air Services Agreements
with other countries, both through bilateral negotiations, as well
as through multi-lateral frameworks.
And it welcomes all airlines to operate from Changi -- both
low-cost and full service carriers. - CNA /ct
