An article titled “We must save Singapore Airlines (SIA) from this existential crisis” published by CNA on Thursday (24 September) has sparked critical responses from the netizens, with many critical of the author’s call to help the airlines.
In the op-ed, National University of Singapore (NUS) Business School Associate Professor Nitin Pangarkar detailed how the COVID-19 pandemic has launched SIA into “an existential crisis” presently “like no other in its illustrious history”.
“The last few months have not been kind to airlines. Lacking domestic traffic, Singapore Airlines (SIA) has suffered more than others,” he wrote.
SIA has implemented “mitigation measures” including slashing down 96 per cent of its fleet during the COVID-19 outbreak, embarking on a large-scale retrenchment process and pay cuts for its board of directors and top management.
In May, SIA recorded its first annual net loss in its history of nearly five decades as the company reported a S$1.12 billion net loss for its first-quarter performance.
Earlier in March, SIA announced that it was slashing 96 per cent of the capacity that had been scheduled until the end of the April this year.
The full-service carrier is now expected to operate below 50 per cent of its capacity at the end of this financial year.
SIA also secured funding of nearly S$19 billion from sovereign wealth fund Temasek Holdings in March.
Temasek, SIA’s majority shareholder, indicated that it would underwrite the sale of shares and convertible bonds for up to S$15 billion.
The rights issue will be offered at S$3 per share, a 53.8 per cent discount to SIA’s last traded price of S$6.50.
Temasek International chief executive Dilhan Pillay Sandrasegara said that the bailout “will not only tide SIA over a short term financial liquidity challenge but will position it for growth beyond the pandemic”.
Many airlines around the world, particularly national carriers, pointed Assoc Prof Nitin in his op-ed, “have been artificially propped up, sometimes for decades, by their home governments for supposed strategic reasons”.
“But SIA doesn’t fall into this category of perpetual money-losing airlines and deserves to be supported for many reasons beyond the several thousand direct jobs it creates in Singapore and elsewhere,” he remarked.
“Should the Singapore Government continue to support SIA if the crisis drags on for years – whether through wage support and other subsidies? Is it throwing good money after bad money?” He questioned.
Given that these are unprecedented times, Assoc Prof Nitin posited that the problems which are environment-related and not airline-specific “should not distract Singapore from the need to support its national carrier through this temporary turbulence”.
Many netizens made critical comments on the Facebook page of CNA, saying that the directors and management of SIA earning million-dollar salaries from the airline’s profitable years should manage their internal crisis first before asking for help.
They said that the management should “fork out their money” or “donate back some money” to save the airlines instead of asking help from the people “who are earning so little”.
SIA chief executive Goh Choon Phong said in February that his “management team will take the lead with a salary cut effective 1 March 2020”.
“I will take a 15 per cent cut in my salary, the executive vice-presidents will take a 12 per cent cut, and the senior vice-presidents 10 per cent,” he said.
“The SIA board of directors have also decided to take a 15 per cent cut in their fees effective 1 March 2020 to show solidarity with the management and all staff,” Mr Goh added.
According to SIA’s Annual Report for the financial year 2018/19, while Mr Goh draws an annual salary of S$1.4 million, his total package amounted to some S$5.5 million in the last financial year after including bonuses, shares and benefits.
Netizens commenting on Assoc Prof Nitin’s op-ed said that if those who “made millions” are incapable of saving the airline, then “it’s better to close it”.
They added that “ordinary citizens” are not capable of offering financial support as it is beyond their financial reach.
A few netizens questioned why the people should help the airlines this time as SIA did not offer discounts on flight tickets when it was “flying high”.
Several netizens said in jest that Ministers can donate half of their “high-paid salaries” to rescue the airlines from the crisis.
“We have 4G Ministers who will save the day. Small people like us have to save our own family,” a netizen wrote.
A few netizens suggested that the Government can nationalise the airlines to help them from the crisis, rather than using taxpayers’ money on a private company to benefit the shareholders.
Several netizens, however, opined that the SIA is not the only one who affected by this pandemic, but other industries, as well such as travel sectors and local small and medium enterprise (SMEs).
If they focus on helping SIA, then “who will save the poor who are losing their jobs?” said one netizen.
“To be fair, this storm hasn’t been kind to anyone too,” another netizen wrote.
Supporting the call to help SIA, other netizens, however, expressed different viewpoints, saying that many future jobs would be lost and the multiplier effect will be created if the SIA is unable to tide through the crisis.
“If SIA not saved, more jobs in other sectors will be lost. Cause and effect,” they said.