SIA under threat from Qatar Airways’ aggressive expansion plans

One-way seat capacity will jump 67%.

Singapore Airlines has long been under threat from the aggressive expansion of Middle Eastern carriers. This threat was starkly illustrated by Qatar Airways’ recently-unveiled expansion plans, which is expected to come into effect within the year.

A report by OCBC Investment Research noted that Qatar will use A350s to drive capacity increase in the republic between May and August this year, with one-way seat capacity from Singapore projected to jump by a staggering 67%.

Qatar's first A350 was delivered on December 2014. Its A350 currently flies from Doha to Frankfurt, and it will soon commence flights from Doha to Boston and Doha to New York.

“The threat from gulf carriers mounts as Qatar Airways recently announced its plan to pursue expansion in Singapore. The capacity increase is in response to high demand for the premium services between Doha and Singapore," stated the report.

In contrast, SIA's first A350 is slated for delivery only in the first quarter of 2016, and it is yet to announce routes for these new planes.

"Qatar is expected to grow its share of the Singapore-Europe market share and also keen to pursue growth in the Singapore-North America market. Looking ahead, we think SIA will continue to face tough competition from the gulf carriers,” the report warned.