Singapore Airlines (SIA) and Malaysia Airlines have been granted conditional approval for a partnership that aims to increase traffic between Singapore, Malaysia, and other markets told the Competition and Consumer Commission of Singapore (CCCS) on Tuesday (May 10).
Singapore Airlines and Malaysia Airlines
The deal, which the two airlines signed in October 2019, involves both parties working together in areas such as joint sales and marketing, as well as payment sharing.
- It also includes expanded code sharing to increase traffic between the two countries, as well as between Singapore or Malaysia and markets such as Europe.
Under a code-share agreement, airlines can sell seats on each other’s flights to provide passengers with a wider selection of destinations.
CCCS said that it has granted conditional approval for the partnership after accepting a set of proposed commitments from both carriers. It had also conducted public consultation during its assessment.
Singapore, Kuala Lumpur, and Kuching
Under the commitments, both airlines will have to subject the arrangement to CCCS for further review when a series of indicators signal sustained comeback and normality of aviation activity on overlapping nonstop routes between Singapore and Malaysia, such as between Singapore, Kuala Lumpur, and Kuching.
CCCS told these proposed commitments would provide sufficient safeguard to ensure that the business arrangement between both airlines is implemented only during recovery from the Covid-19 pandemic.
Due to the pandemic, competition on these overlapping direct routes is limited even without the arrangement between both airlines. Any effect on competition that may happen is also mitigated, CCCS told.
It noted concerns raised by third parties about the deal between the two airlines. But it added that the commitments by the airlines will permit better assessment of these concerns, as well as the competition impact and benefits of the arrangement when there is sustained recovery in the aviation sector.
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It was previously reported that the tie-up between the two airlines will allow SIA travelers access to more places in Malaysia.
Malaysian travelers will also have easy access via Changi Airport to
Malaysian travelers will also have easy access via Changi Airport to SIA’s wide network of international flights, which will help to boost Singapore’s status as a key air hub in the region. The new deal includes SIA subsidiary Scoot, as well as Malaysia Airlines’ sister airline Firefly.
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