Bright future for low-cost carriers

Bright future for low-cost carriers

Deutsche Presse-Agentur, Singapore

The potential for budget travel growth in Asia is so huge a top
Singapore minister predicted on Wednesday intra-regional air
transit will one day overtake the United States.

Minister for Transport Yeo Cheow Tong noted budget carriers
globally are offering 19 percent more flights this year compared
to a year ago at the launching ceremony for the low cost terminal
at the Changi Airport.

"The potential for growth in Asia is tremendous," he said,
adding budget travel in the region is still in its infancy.

A vast proportion of ASEAN's 500 million people have never
flown before, presenting a large potential pool of air travelers,
Yeo said, referring to the 10-member Association of Southeast
Asian Nations.

"If we add the combined population of 2.3 billion in China and
India, there is an exciting possibility that intra-Asian air
travel will one day overtake even the U.S.," Yeo said.

The ceremony marked the first anniversary of services by
Singapore's first low-cost carrier. It was a year ago when
Valuair, owned by former Singapore Airline (SIA) executives, took
to the skies.

Within six months, Tiger Airways -- owned by SIA, Indigo,
Irelandia and the Singapore government's investment arm -- and
Qantas-owned JetStar Asia started services.

"The operating environment in Asia is vastly different from
that of the U.S. or Europe," Yeo said, citing the regulatory
environment among other factors.

"While some countries, such as China, Thailand and Brunei have
liberalized their aviation markets, most Asian countries are
still very protective of their air rights," Yeo noted.

In outlining the upcoming terminal design and layout, Yeo
said, "Low cost carriers do not require many amenities, such as
business lounges, travellators or aerobridges... This low cost
terminal will ensure that our infrastructure and services suit
their business model."

With construction expected to be completed in a year's time,
Yeo said the two adjacent single-story buildings will be cheerful
and relaxing, with travellers greeted by soothing colors on the
walls, floors and decorative ceiling features.

A range of shops will include money changers, retail
establishments, food and beverage outlets and duty-free shopping.

The 25,000 square-meter facility will be able to handle about
2.7 million passengers a year.