Singapore Airlines gains lucrative 'kangaroo' route

Singapore Airlines gains lucrative 'kangaroo' route

SINGAPORE (Reuter): Singapore Airlines (SIA) has gained an
important toehold in the lucrative Australia to Europe "kangeroo"
route with its new four-airline alliance, boosting its position
against other linkups, analysts said yesterday.

Its agreement to tie up with Australia's Ansett, Ansett
International and Air New Zealand would not overtake its nearest
rivals but would place it in a more competitive position.

"It's positive for SIA because it strengthens their network in
the southwest Asia-Pacific region," said Nua We Boon, analyst
with Fraser Securities.

SIA's alliance will pose a threat to the tie-up between Qantas
and British Airways Plc on routes between Australia and Europe,
they said.

It will also bolster its already extensive Asian operations as
SIA will capture more passengers from Australia, filtering them
into a market where it has an existing stronghold.

The alliance, described by the carriers as the largest in the
Asia-Pacific, includes code-sharing, joint purchasing, joint
marketing and cargo operations.

SIA, which flies to the major cities in Australia and New
Zealand, will have access to new domestic destinations.

But all the airlines would benefit from the linkup in terms of
being able to offer more comprehensive packages, the analysts
said.

They said airline operations on such major passenger routes
helped trim operating costs and offered freer access to
previously shut domestic routes.

"All this just means that it will help per unit costs," said
Lai Yeu Huan, an aviation analyst with J.M. Sassoon.

But he said the alliance was a defensive move to counteract
the stranglehold on the kangeroo route by British Airways and
Qantas, arguably entrenched in pole position.