SINGAPORE – Singapore’s aviation industry icons, Singapore Airlines (SIA) and Changi Airport Group (CAG), are weathering an unprecedented crisis caused by Covid-19. And it’s unclear if and when the companies, both synonymous with the city-state’s role as a transit hub, will regain their past heights.
The national carrier secured one of the biggest state rescue packages in the global airline industry in March and has thus far raised S$11 billion (US$8 billion) in funds since the start of the 2020-21 financial year through secured financing, loans, and a rights issue backed by state investment company Temasek Holdings, its majority shareholder.
“Without the recent major capitalization exercise, there would not be an SIA today,” said Transport Minister Ong Ye Kung in an address to Parliament on October 6. While analysts see the airline as being better-positioned to ride out the turbulence given the amount of finance it now has at hand, further losses and downsizing appear inevitable.
In September, SIA announced the largest retrenchment in its history with 4,300 positions, or around 20% of its staff, affected. A subsequent agreement between the flag carrier and its pilot union saw some 400 jobs saved in exchange for pilots taking salary cuts of between 10% to 60%. Foreigners have so far been among the first to be let go.
Jeremy Leong, a 21-year-old from Malaysia, was among those retrenched last month after working as an SIA flight steward for two years. “It was definitely a big shock for many of us. I always had my fingers crossed the situation would get better. SIA was honestly my dream, I had planned to grow a career out of it and climb the ranks,” he said.
“It was all going so well.”