Source: Bloomberg
By Jonathan Burgos

Scoot Pte is offering iPads to budget long-haul travelers after eliminating more than two tons of entertainment equipment to save fuel.

The Apple Inc. tablets helped the carrier cut 7 percent off the weight of planes obtained from parent Singapore Airlines Ltd. even after a 40 percent increase in seating, Chief Executive Officer Campbell Wilson said. The savings will help Scoot, which makes its maiden flight today, cope with fuel prices that have jumped 36 percent in two years.

Fuel is “the number one worry” for any airline, as it usually accounts for at least 40 percent of costs, Wilson said in a June 1 interview in Singapore. Scoot will charge economy passengers S$22 ($17) a trip to rent the tablets, which are loaded with movies, music, games and television shows.

Cutting costs and finding new sources of revenue will be key for Singapore-based Scoot as it seeks to make a profit flying older planes than other low-cost carriers and selling tickets as cheap as S$158 one-way to Sydney, a flight of more than seven hours. Singapore Air formed Scoot after budget operators led by Jetstar and AirAsia Bhd. won 26 percent of the city’s air-travel market.

The iPads are “a very smart move,” said Corrine Png, JPMorgan Chase & Co.’s Singapore-based head of regional transportation research. “If they can make the aircraft lighter, it does help improve fuel efficiency.”

The budget carrier will loan the iPads free to passengers in its business-class seats. It also eventually intends to have users access content via a wireless system on planes. Qantas Airways Ltd. began trials of a similar product in December.

 

China Flights

 

The carrier will have four Boeing Co. 777s this year, each fitted with 400 seats, including 32 in business class. The airline will add its second destination, Australia’s Gold Coast, next week. Services to Tianjin, China will begin in August followed by two other northern Chinese cities before the end of the year, Wilson, 40, said.

“China has a huge amount of potential,” he said. “It’s developing fast and the propensity of people there to spend is increasing dramatically.”

China will probably be the world’s fastest-growing aviation market through 2014, with international passenger numbers swelling at an average pace of 11 percent, the International Air Transport Association said last year.

Scoot plans to increase its fleet to as many as 14 777s by the middle of the decade. The carrier will be able to pare maintenance costs by working with its parent, Wilson said.

Singapore Air also owns regional carrier SilkAir and has a stake in short-haul budget carrier Tiger Airways Holdings Ltd.

–Editors: Neil Denslow

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net


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