172-Singapore-A380Best in the business? Business class on the Singapore Airlines A380. Photo: AFP

Clive Dorman reports on an airline with full service and cheap fares.

The term “price leader” is a magnet for consumers and is generally claimed by cut-price airlines on the prowl for new business. To hear it in the same sentence as “Singapore Airlines” not only signals value for passengers but also indicates we’re living in extraordinary times.

Singapore Airlines (SIA) has been chasing customers aggressively this year with prices that are unheard of for one of the travel industry’s full-service leaders.

As the Asian economy starts to show signs of recovery, prices have begun to creep up again in the past few weeks but SIA – hit savagely by the downturn’s effect on business travel and freight – is still actively spruiking new cheap-fare initiatives, including a low-price guarantee it launched last week, aimed at the Australian market.

SIA is guaranteeing travel from Melbourne and Sydney to Europe in the middle of next year using early-bird specials priced from as little as $1800 return – about $500 cheaper than the typical advance-purchase discounts on competing airlines a year ago.

That’s quite a bit more expensive than the $1100 specials from Melbourne to London launched earlier this year by AirAsia X. While SIA is watching the emergence of low-cost competition carefully, it doesn’t regard the discount carriers as genuine competition, especially for long-haul travel.

“The question on our minds has been how confident will consumers be in purchasing these early-bird offers … because they might be accustomed to so many promotions and might want to wait around for a better offer,” says SIA’s Australian manager, Subhas Menon.

“We wanted to give certainty to our customers and we thought one way we could do so was to give them this undertaking – that if we were to come out with a better offer in the future we would refund them the difference.”

Menon says the airline has been operating in uncharted territory for most of this year.

“Yes, it is true our fares have been very attractive this year, mainly because we thought we should do whatever we can to stimulate the market to help with the business recovery,” he says. “Instead of us being always perceived as a premium carrier, we thought it was a valuable proposition to make to our consumers: you can have the Singapore Airlines service cheaply, which is not usually the case.”

The biggest foreign carrier in the Australian market, SIA is confident it will see its passenger volumes return.

“We don’t really consider AirAsia as a competitor on long-haul routes,” Menon says. “There is a fair amount of discomfort and inconvenience if you are travelling low cost on long-haul flights, whereas full-service carriers like us provide the two flights and all the facilities.

“We also want to attract first-timers and we feel once we’ve done that there will be no looking back – that when prices eventually do go up they’ll be accustomed to a level of service and comfort that they will continue to look for in the future.”