Malaysia Airlines and Singapore Airlines have entered into a wide-ranging commercial agreement which will include joint marketing activities to develop tourism, with the deal also covering SIA subsidiaries SilkAir and Scoot as well as Firefly from Malaysia Airlines.
The partnership is pending regulatory approval and could result in a sharing of revenue on flights as well as an expansion of codeshare routes, offering consumers more flight choices. Currently, the two airlines codeshare on flights between Singapore and Kuala Lumpur, Kota Kinabalu, Kuching and Penang.
Malaysia Airlines CEO, Captain Izham Ismail, said the partnership is in line with the company’s long-term business goal of engaging in deep partnerships to extend reach and presence globally.
“This partnership is more than a conventional partnership and we believe in the mutual benefits for both airline groups and countries,” he said in a joint statement.
The recent agreement follows the signing of a memorandum of understanding (MoU) in June 2019, which aimed to offer new customer benefits as well as new business opportunities. Both parties intend to offer joint fare products, align corporate programmes and explore tie-ups between their frequent-flyer programmes.
Singapore Airlines CEO Goh Choon Phong said: “This will be a win-win for both our airline groups and provide new benefits for our customers.
“The expanded scope of our partnership has the potential to provide a significant boost to the tourism industries in both Malaysia and Singapore, as well as the wider Southeast Asia region.”
Singapore Airlines currently has a long-lasting global marketing tie up with the Singapore Tourism Board, which has resulted in campaigns including the recent Unexpected Journeys.
Meanwhile, Malaysia Airlines recently launched a new logo and brand campaign, called ‘Fly Malaysia’, aimed at drumming up inbound and domestic travel in support of Visit Malaysia 2020.
The proposal to share revenue, touted as a significant step in the aviation industry, signals cooperation instead of competition between the two airlines in future.
The agreement also reflects the tough operating landscape in Southeast Asia, where budget carriers like AirAsia are dominant players and control about 50% of the market.
In addition, Persian Gulf carriers such as Qatar Airlines and Emirates have aggressively added routes throughout Southeast Asia over the last ten years. Passengers travelling from Europe and North America to the region now have more options than they did in years past.
Sourced from Singapore Airlines, Malaysia Airlines, Marketing Interactive, Mumbrella Asia, Straits Times
