Singapore to build budget terminal

Singapore to build budget terminal

Bernice Han, Agence France-Presse, Singapore

Singapore's Changi airport will build Asia's first dedicated low-cost airline terminal to cash in on the region's booming no- frills aviation industry, airport authorities said on Tuesday.

The single-storey terminal is expected to be ready by early 2006 and have an initial handling capacity of 2.7 million passengers a year, the Civil Aviation Authority of Singapore (CAAS) said.

Costs for airlines and passengers will be about 20 percent lower than at Changi's major terminals, CAAS deputy director of airport management Foo Sek Min told reporters.

To keep costs down, there will be no travelators, escalators or aerobridges, meaning passengers will do a lot more walking than at other regular airports.

"The focus of this terminal will be really on low running and maintenance costs," Foo said.

"It will focus on functional facilities and services. That means we are talking about necessities ... things that are really needed in operating the terminal."

However Foo stressed that regular facilities such as duty free shops, eateries and money changing outlets would be available.

Foo said the decision to build the terminal was made after Tiger Airways, a local budget carrier due to start flying late this year, committed last week to using it.

"We are proceeding with this low-cost terminal because there is a customer," Foo said, adding authorities were in talks with two other airlines.

Foo said the terminal, which CAAS described as the first in Asia dedicated solely to low-cost carriers, was also being built to ensure Singapore remained a key player in the region's booming budget airline industry.

"Currently we have 70 airlines offering more than 3,000 weekly flights and we want to facilitate the operations of all airlines in Singapore, including low-cost carriers," Foo said.

"It is part of the efforts to grow Singapore's status as an aviation hub."

Two other budget airlines, Malaysia's AirAsia and Singapore's Valuair, are already flying in and out of Singapore using Changi's major terminals, while a Qantas-dominated venture also intends to begin operations soon.

Foo said the terminal would be built with a modular design, meaning it can be expanded easily when more airlines decide to use it.

"The terminal size can be expanded to cater for more passengers as the traffic grows over the years. Similarly more parking bays can be put in to cater for the (different) type of aircraft," he said.

Tiger Airways, which the Singapore government is heavily involved in, is due to hold a press conference on Wednesday to outline its plans.

The government's investment arm, Temasek Holdings, is the majority shareholder in Singapore Airlines, which in turn owns 49 percent of Tiger Airways. Temasek has another separate 11 percent stake in Tiger.

AirAsia, Asia's most successful no-frills carrier, began a Singapore-Bangkok route this year and has expressed its desire to set up a permanent base here to expand operations.

Valuair flies to Bangkok, Jakarta and Hong Kong, and has also said it intends to add more routes.

Australia's Qantas announced in April it was teaming up with Temasek and two Singaporean businessmen to launch another Singapore-based no-frills operation.