June 4th, 2012
06:58 AM GMT
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Editor’s note: Outlook is CNN's in-depth look at business climates around the world. To August 12, 2012, we’re focusing on Singapore.

Asia’s latest discount airliner takes to the skies Monday, with its inaugural flight from Singapore to Sydney.

Launched by Singapore Airlines, no-frills Scoot has already sold more than 100,000 tickets, according to The Straits Times. In its first year, it will offer flights on four Boeing 777 aircraft, linking Singapore with nearby countries, including Australia and China. Currently, tickets are available to the Australian cities of Sydney and Goldcoast, as well as Bangkok and Tianjin, China. 

Scoot is expected to eventually offer medium and long-haul flights to destinations in Australia, New Zealand, the United States, and Europe.

Its launch is a bold move, especially at a time when legacy Asian airlines are struggling to turn a profit amid cut-throat competition and soaring fuel prices.

Its parent company, Singapore Airlines, reported a SG$38.2 million (US $29.6 million) loss for its January-March quarter.

Last month, Hong-Kong based Cathay Pacific halved its earnings estimate for 2012 to HK $2.03 billion (US $261 million) and reduced it by 30% for the following two years.

Australia’s Qantas announced two weeks ago that it will cut 500 maintenance and engineering jobs, following an 83% drop in its H2 2011 earnings. Its domestic and international operations will also be split into individual business units as part of a five-year turnaround plan.

Scoot’s take-off will also heighten competition between emerging low-cost carriers in the region, often launched by legacy airlines themselves.

Ticket sales opened on May 30 for AirAsia Japan, a partnership between Malaysia’s AirAsia and Japan’s All Nippon Airway, which is offering budget airfares for domestic Japanese flights from Tokyo. AirAsia Japan plans to add international flights by the end of the year.

Jetstar Japan, partially owned by Qantas and Japan Airlines, will launch new month with discount domestic flights.

They will complete with Japan’s first domestic low-cost carrier, Peach Aviation, launched last year by All Nippon Airways. Peach began a route from Osaka to Seoul last month and will add routes to Hong Kong next month and Taipei later this year.

CNN’s Outlook series often carries sponsorship originating from the countries we visit. However CNN retains full editorial control over all of its reporting.

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Filed under: Air industryBusinessJapanOutlook SingaporeTravel industry

soundoff (9 Responses)
  1. scoot singapore

    Visit their website http://scootsingapore.com/

    June 4, 2012 at 4:17 pm |
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  4. Auth

    I have heard this washing manihce analogy before. It is different. In the case of , say, washing manihces, you are talking about a relatively small sum and a retailer who is, in theory, working on a good margin. In travel you are talking high turnover, low margin a relatively high sum, indeed perhaps a families annual savings, and a retailer who is working on , let's face it, a very small margin. A better analogy may be a car though even there, the retailer is on a pretty good margin. Now, stabiliser et al came about in part due to naughty people gathering in a whole batch of famillies savings and then doing a runner. Bonding, etc inter alia, makes sure that that incentive is minimalised.@Barrie if you avoid travel agents like the plague, you must be very rich. The most expensive way of buying an airline ticket (arguably, anything other than a short haul ticket) is by buying it direct from an airline. It may be you use the likes of expedia and travelocity (the latter being better in my opinion expedia can be ruddy expensive) but these are also travel agents. If you avoid travel agents, you will not be easily able to access the CAT45 fares, consolidated fares and the like which are available through travel agents.Sorry, anyway, travel industry answer I favour the levy. As Nick says, it is only a31 or a32 a pop and that means everyone gets covered. RyanAir moan about everything but RyanAir can go bust just as much as anyone else, despite the rather jaundiced views of one Mr O'Leary.

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  6. Cliff Hannam

    I will be flying to Bangkok on the 8th of October 2012 and returning about 22nd of Oct, 2012 . I will be bringing back my Wife , one way. I am able to book my ticket ok ,but am having trouble booking the ticket for Joon (my wife) Could you please help. My phone # 02-64567093 mob. 0431 038 783.
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  9. shadyslimo

    This would be interesting if they start flying into JFK, Laguardia or Newark. I mean, the airports are congested as it is, so where would they fit this new company? We have an airport map that our chauffeurs use and every time i glance at it, i'm overwhelmed by the amount of airlines that occupy the terminals let alone our chauffeurs having to figure out one airline from another. More info can be found here: http://www.shadyslimo.com

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