Advisory and Updates on COVID-19 (Coronavirus Disease 2019): sutd.edu.sg/advisory.

Ensuring Singapore's aviation sector stays strong, viable

21 Apr 2019

Straits Times, 21 Apr 2019, Ensuring Singapore's aviation sector stays strong, viable 

Not since the Trump-Kim summit last June has Singapore hogged international headlines. The opening of Jewel Changi Airport last Wednesday, after a six-day public preview for half a million people who had signed up for free tickets, made news across the world.
 
With 280 shops and dining outlets, a 40m indoor waterfall, a forest, and a playground equipped with sky nets and mazes that will open in June, Changi Airport has outdone itself, said many visitors.
 
The $1.7 billion 10-storey Jewel complex next to Terminal 1, a joint venture by Changi Airport Group (CAG) and CapitaLand, is more than just a mega mall or playground. It is an investment to grow traffic by making Changi Airport more attractive to travellers, built on the understanding that continual upgrades and enhancements are critical to secure Singapore's status as a key air hub in the region.
 
CAG chief executive Lee Seow Hiang tells Insight: "Right from the beginning, Jewel was conceptualised for our customers, both international travellers as well as locals.
 
"We needed to remain relevant to the growing region and the changing world. This requires constant reinvention and innovation. Being relevant not only creates opportunities, but growing capacity can shift the demand equation."
 
Even as Jewel was being constructed the last four years, T1 underwent a $323 million upgrade to add new check-in counters, baggage belts, carpets and floor tiles.
 
Later this year, upgrading works will start at T2.
 
Jewel is an extension of what Changi was already doing at its terminals - horticulture, retail and play areas, said Mr Lee. The project was also an opportunity for the team to push the boundaries.
 
"This is the first time we are putting together an attraction in itself," he added. "Jewel is like a minimum viable product, which allows us to test concepts for the future Changi East, which, at 1,080ha, is many times bigger."
 
The Changi East development, slated to be completed around 2030, includes the construction of a new mega passenger facility, T5.
 
Changi Airport handled 65.6 million passengers last year - a third of them in transit - and is the world's sixth-busiest international airport.
 
But on a continent where air passenger traffic is growing exponentially, it faces stiff competition from other airports in Asia.
 
Said Professor Guido Gianasso, academic director of the Iata-Nanyang Advanced Management Programme at Nanyang Technological University's Nanyang Business School: "Jewel is unique... It will definitely further cement Singapore hub's competitive position against other regional hubs, such as Hong Kong, Bangkok, Dubai and Doha."
 
It is also important to note that a growing number of long-haul travellers are opting for budget flights, which often involve separate bookings for different legs and, sometimes, a layover of several hours. He said: "Jewel could persuade them to travel via Singapore instead of using other regional hubs."
 
Singapore Management University's Assistant Professor Terence Fan, who specialises in transport issues, said Jewel could "gently nudge" people to fly through Singapore. "In an increasingly competitive air travel market, these gentle nudges towards Singapore, and perhaps some negatives in alternative transit cities, can be conducive to Singapore's air hub status," he said.
 
But Mr Saj Ahmad, chief analyst at StrategicAero Research, noted that while there will be those who may choose to transit via Changi because of what Jewel offers, "the reality is that most transit passengers want the absolute minimum connection time between flights so that they can get to their end destination as quickly as possible".
 
This is why Changi Airport must continue to push for the best overall experience for travellers, said Mr Abbas Ismail, course chair of the Diploma in Aviation Management at Temasek Polytechnic's School of Engineering: "The key consideration for choosing to use Changi will always be the efficiency and effectiveness of airport operations... Jewel is the icing on the cake."
 
Mr Loh Hean Ho, partner and global lead for transportation infrastructure and airports at the Boston Consulting Group, noted that in the last decade, Changi has embarked on multiple breakthroughs in innovation and invested in self-service technology. He said given stronger competition, "it is critical for airport operators to create a strong, compelling reason - like Jewel - for travellers to want to arrive earlier at the airport or choose to transit in Changi for the experience offered".
 
Harnessing technology is another key focus for Singapore's aviation sector, which also includes the aircraft maintenance, repair and overhaul business. In 2017, the Civil Aviation Authority of Singapore (CAAS) unveiled the Air Transport Industry Transformation Map to create better jobs and career opportunities for workers, and to support the sector's growth and competitiveness.
 
Resources are also being poured into air traffic management systems and research, for safer and more efficient management of a growing number of flights in the region. This month, CAAS and the Singapore University of Technology and Design also signed a deal to set up an Aviation Studies Institute to advance air traffic management research and development here.
 
Air space management also includes discussions among governments and globally on how the sky should be divided among different air traffic control service providers.
 
The International Civil Aviation Organisation has emphasised safety of navigation in periodic discussions on re-aligning these flight information regions.
 
Observers say Singapore must keep moving to ensure the aviation sector, which accounts for about 6 per cent of gross domestic product and more than 160,000 jobs, continues to be strong and viable.
 
Mr Kelvin Wong, assistant managing director at the Economic Development Board, tells Insight: "We continue to establish strong linkages while enhancing our physical, financial and digital connectivity with key global markets, to participate in growth opportunities in regions such as Asean." Events like the recent 7th World Civil Aviation Chief Executives Forum organised by CAAS also reinforce Singapore's thought leadership globally, he said.
 
As the demand for air travel continues to grow, there will be good opportunities not just for Changi Airport and Singapore carriers, but also the aerospace sector.
 
Advancements in technology will create new market segments such as unmanned aircraft systems that enable companies to be more productive, while creating skilled jobs in areas like robotics engineering.
 
Singapore must continue to push the boundaries to benefit from the opportunities and hold off challengers. Now that Jewel is done, it's time to move on to the next big thing.