Scoot Selects Sydney as Inaugural Destination

Long-haul, low-cost start-up Scoot has announced that Sydney will be its first destination when it launches operations next year, a route that is already served by its sister carrier Singapore Airlines (SIA). The announcement was made on December 1 by the Premier of New South Wales accompanied by the State's Minister of Transport, the CEOs of Tourism Australia, Destination New South Wales, Sydney Airport Corporation and Scoot, from a rooftop venue overlooking the city's iconic Circular Quay, Opera House and Harbour Bridge.

"Scoot's decision to fly its first service between Sydney and Singapore from mid-2012 is fantastic news," said Barry O'Farrell, Premier of New South Wales. "This is a great win for Sydney and travellers in the Asia Pacific region, opening up Australia's premier city to new aviation routes and lower-cost carriers. This is a significant step towards our goal of doubling tourism expenditure by 2020, placing Sydney front and centre of the boom in budget travel in emerging markets like Singapore, China and India."

The selection of the Australian city as Scoot’s first route is no real surprise. Its Asian rival AirAsia X has been fighting for access to the Sydney market from Kuala Lumpur with no success, as the destination offers everything to support the low-cost, long-haul model – strong business and leisure traffic, a healthy premium segment and a market that is showing good passenger growth. Even in a perfect world it is difficult for low-cost, long-haul airlines to succeed and it is important for them to fill the front end of the aircraft to make any route sustainable. In today’s marketplace with fuel price volatility and economic uncertainty, it is even more important that reasonable yields are secured.

The Singapore – Sydney route is already flown by SIA four times daily with two rotations using its Airbus A380-800. Qantas also offers three flights per day, one using the A380-800, while British Airways serves the route as an extension of its London Heathrow services. In the past year an estimated 546,000 O&D passengers travelled on the route, up 3.0 per cent on the previous 12 months. Average fares have also risen by a notable 17.0 per cent between the same periods. The table below shows the breakdown of traffic on the route by classes for the past year, last year and five years ago.

"Scoot is absolutely delighted that Sydney, one of the world's great cities, will be our inaugural destination. And as the first true no-frills airline operating nonstop daily between Sydney and Asia, we can't wait to bring a whole new style of travel, even better airfares and our unique attitude – our Scootitude – to shake things up. Sydney, here we come! "added Campbell Wilson, Chief Executive Officer, Scoot.

The start-up carrier was formally launched on November 1 and plans to inaugurate operations mid-year initially using four Boeing 777-200s purchased from its parent company. Scoot is offering a very different product to the market and is operating as a completely separate entity to its parent SIA and its network will include some new routes and others that are new to no-frills airline operations.

Scoot has ambitious development plans and will make use of the respected Internet-based Route Exchange platform from Routesonline to support the next stage of its growth. The carrier is currently finalising its plans but will launch a formal Request for Proposals (RFP) through Route Exchange during the first quarter of 2012 for potential network expansion in China, Asia and into the European market from the second quarter of 2013.

The airline is currently working with the Civil Aviation Authority of Singapore for its Air Operator’s Certificate (AOC), and anticipates receiving this during the first quarter of 2012. Engineering retrofit and certification of its aircraft will take place between April and June, and the first commercial flights are targeted for the middle of the year.