Changi to start budget terminal in '05

Changi to start budget terminal in '05

Karl Malakunas, Agence France-Presse, Singapore

Budget airlines may be able to operate out of Singapore's Changi airport within 18 months using a new no-frills terminal, the city-state's transport minister said on Wednesday.

In what would be a major boost for budget carriers who have so far been reluctant to use Changi because of its high operating costs, Yeo Cheow Tong said fees at such a terminal could be 20 to 30 percent less.

Yeo said the government intended to set up a new no-frills terminal to ensure Singapore did not miss out on the benefits of the fast-growing budget airline industry in Asia.

"Singapore will spare no effort to ensure that we remain the premier air hub in this region," he said at media function at Changi.

"We will continue to build on our fundamentals to ensure Changi Airport remains the preferred hub of choice for full- service carriers.

"But we also have to be nimble and adopt a complete mindset change to ensure that we can cater to the development and growth of low-cost carriers in this region."

Yeo said it made sense to have a low-cost terminal operate out of Changi, rather than establish new facilities at Singapore's secondary Seletar airport.

"The infrastructure is there. They don't have to duplicate the runways, the taxiways," he said.

"In terms of adding to the connectivity of Changi it makes sense. Passengers coming from Europe can transfer to a low-cost airline at Changi."

Yeo said he had instructed the Civil Aviation Authority of Singapore to explore what it could do to service the growing low- cost airline industry in Asia, and a decision on the new terminal would be made within a few months.

He said the terminal could be operating within 18 to 20 months, but said it would have few of the luxuries passengers now experienced at Changi airport.

"Although it will be physically located at Changi, and be equally efficient and clean, it will be quite a different concept from the current terminals in Changi airport in terms of its physical attributes," he said.

"In fact going by the low-cost terminals I have visited in the UK (United Kingdom), I expect the low-cost terminal in Changi, if we do build one, to have the same physical attributes as some of our bus terminals."

Yeo described the prospective facilities as "very, very basic" and warned passengers would have to take their own umbrellas in case it rained when they got off the plane to walk to the terminal.

Yeo's comments come just a week after national carrier Singapore Airlines announced it intended to join the budget airline industry by setting up Tiger Airways with three partners to fly from the city-state next year.

Low-cost Malaysian carrier AirAsia's efforts to establish a Kuala Lumpur-Singapore had previously been frustrated because Singaporean authorities had refused to give it cheaper operating fees at Changi.

A host of other regional budget airlines have either recently begun operations or flagged their intention to take off soon.