Singapore Airlines Cargo

History

In July 1992, Singapore Airlines created a cargo division to complement its passenger-carrying business. However, it was not until 1 July 2001, when Singapore Airlines Cargo was incorporated, taking over the air-freight operations of Singapore Airlines as a separate subsidiary. SIA Cargo leased the entire freighter fleet from Singapore Airlines, as well as taking over management of the cargo holds in all of Singapore Airlines' passenger aircraft. Within a few months, it entered an alliance with Lufthansa Cargo and SAS Cargo Group to form WOW Alliance on 1 October 2001.

SIA Cargo's warehouse in Singapore, dubbed SIA Superhub 1, was opened in 1995. This warehouse is capable of handling up to 450,000 tons of goods a year. In 2001, the SIA Superhub 2 was opened which increased the capacity to over 1,200,000 tonnes per year.

Securerider, a premium product for secured shipments was launched on 7 January 2002, including services such as Swiftrider, Timerider and Coolrider targeting general shipments, heavy shipments, and temperature-sensitive cargo, respectively.

The airline garnered its first award as an all-cargo airline by winning the "Best Global Air Cargo Carrier" and "Best Air Cargo Carrier - Asia" at the Asian Freight Industry Awards (AFIA) in 2002, an award the parent company, Singapore Airlines, had already won eight times consecutively. It was named as the "Best Airfreight Carrier" in the inaugural Hong Kong-based Asia Logistics Awards in the same year.

New routes were introduced in the next few years as the airline began to take advantage of liberalised aviation agreements. A round-the-world service was introduced on 31 October 2001, flying from Singapore to Hong Kong, Dallas, Chicago, Brussels, Sharjah, and back to Singapore on Wednesdays, and on the Singapore, Hong Kong, Dallas, Chicago, Brussels, Mumbai, Singapore route on Fridays. It became the first third-country freighter airline to fly direct between China and the United States on 22 May 2003 when flights commenced from Singapore to Xiamen, Nanjing and onwards to Chicago. Return flights are operated from Chicago and Los Angeles to Nanjing.

In December 2008, Singapore Airlines Cargo was alleged by the Australian Competition and Consumer Commission for price fixing cartels in the air cargo industry. The ACCC accused Singapore Airlines Cargo of fixing the price of a fuel surcharge and a security surcharge that was applied to air cargo to and from Australia. Singapore Airlines Cargo is the third airline to be the targeted for fuel surcharge price fixing.

In May 2010, Singapore Airlines was fined by the Fair Trade Commission (South Korea) for conspiring to introduce fuel surcharges for freight cargoes or continued to raise them over the past seven years. Singapore Airlines Cargo released a statement saying that they are "very disappointed" and "will study the decision closely with a serious view towards mounting an appeal" once they receive the Commission's full reasoning.

In November 2010, the European Commission fined Singapore Airlines Cargo 74.8 million euros for its involvement in a global cartel that included ten other carriers. The Commission found that the carriers—including SIA, Japan Airlines, Qantas, Air Canada, Air France-KLM, and British Airways—had fixed fuel and security surcharges for more than six years. Singapore Airlines Cargo said it would likely appeal the ruling.

On 30 November 2010, Singapore Airlines Cargo pleaded guilty to a US$48 million fine imposed by the U.S. Department of Justice for its role in a conspiracy to fix cargo rates since February 2002, until at least 14 February 2006. Singapore Airlines Cargo's price fixing is in violation of the Sherman Act, which carries a maximum fine for corporations of US$100 million.

In December 2013, Singapore Airlines Cargo agreed to settle over the issue of price fixing in the United States, without admitting to any wrongdoing or liability. Numerous airlines, including SIA Cargo, saw class action taken against them in 2006 following investigations by various competition authorities on price fixing in air cargo services in the US. SIA Cargo decided to accept an amicable resolution to settle the class action with the payment of US$62.8 million.

Destinations

As of October 2016, Singapore Airlines Cargo offers dedicated freighter services to 19 destinations.

Singapore Airlines Cargo (SIA Cargo) offers more than 900 flights a week from its Singapore Hub, at Changi Airport, linking more than 70 cities in over 30 countries across 6 continents with its fleet of dedicated B747-400 freighters and 100 wide body passenger aircraft in the SIA Group whose belly hold cargo space SIA Cargo markets. Sharjah, Amsterdam, and (to a lesser extent) Brussels are hubs for the Middle Eastern and European regions respectively. Additionally, as SIA Cargo manages the cargo holds of all Singapore Airlines passenger aircraft, the company offers cargo product services to all destinations on the Singapore Airlines passenger network.

Current fleet

As of 31 January 2017, the Singapore Airlines Cargo fleet consists of the following aircraft:

Fleet development

In 1992 SIA Cargo bought a Boeing 737-300 from WTC. The aircraft was only in service with Singapore Airlines for 4 years and was sold to L Aeropostale in 1996. When incorporated in 2001, all nine Singapore Airlines' Boeing 747 freighters were transferred to the new cargo start-up at market value, and henceforth, all new freighter purchases were to be made from the new company's books. All cargo-hold spaces in the Singapore Airlines' passenger planes are also managed by the new company.

SIA Cargo operates 11 Boeing 747-400Fs. The Boeing 747-400 freighters have a maximum payload of 112 tonnes and a maximum range of 8,230 km. They feature typical capabilities such as front loading from the nose, temperature control and pressure-regulation systems. Despite the increase in payload offered by the Boeing 747-8 Freighter, which can carry up to 140 tonnes of cargo, SIA Cargo has announced that there are no plans to acquire them. According to the then-CEO Chew Choon Seng of Singapore Airlines, “We (Singapore Airlines) are not convinced about the additional expenditure that would be needed to renew the freighter fleet with 747-8 freighters, when the tradeoffs in terms of operating efficiency is rather marginal, in our view. So we do not need that."

Due to the financial crisis in the late 2000s, there was a drop in global demand for freight. SIA Cargo had since parked freighters at Southern California Logistics Airport in Victorville, California from January 2009 until February 2015 to reduce capacity. SIA Cargo had also phased out the Boeing 747-400BCFs. In addition, the company manages the cargo holds of Singapore Airlines' and Scoot's passengers aircraft. These offer a cargo capacity of 9-23 tonnes per plane depending on aircraft type.