BMI's Executive Summary

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Core Forecasts

Tourism arrival figures from July, August and September 2007 have underlined BMI's bullish prognosis for the Singapore tourism industry. July saw 952,000 tourist arrivals, August 913,000 and September 766,000 – bringing the year-to-date figure to 7.565mn. September's figures set a new record for that month, up 7.1% year-on-year (y-o-y).

The top five markets for Singapore were Indonesia (136,000), China (76,000), Australia (71,000), India (55,000) and Japan (54,000). Together, these markets accounted for 51% of total visitor arrivals during the month of September.

Given the continued strong performance of Singapore's tourism sector, we see little reason to change our forecast that tourist arrival growth will register 7.5% in 2007, taking arrivals to 10.3mn by year-end. By the end of our forecast period, in 2011, we predict that annual visitor arrivals will be running at 13.2mn. Foreign exchange receipts are expected to register US$10.4bn in 2011. We expect annual departures of 5.7mn by 2011, with a steady growth rate of around 5%, largely reflecting the rate of real GDP growth.

A380 Takes Flight With Singapore Airlines

The major news from the aviation sector over the third quarter of 2007 was the maiden commercial flight of Airbus' new A380 aircraft, under the Singapore Airlines (SIA) banner. The first flight, from Singapore to Sydney, took place on 25 October, with the return flight to Singapore taking off the next day. The aircraft was delivered to SIA by Airbus on 15 October 2007.

The majority of the seats for the two legs of this flight were sold through eBay, with all proceeds (estimated at around SGD1.9mn) donated to charity. A scheduled service between Singapore and Sydney (on one of the three daily flights in each direction) commenced on October 28 2007.

As soon as SIA receives delivery of new aircraft, the airline plans to introduce the A380 on one of its three daily flights between Singapore and London Heathrow in the first quarter of 2008.

BMI believes that the long-awaited launch of commercial services of the A380 will boost tourist arrivals to Singapore, as people not only seek to visit Singapore on the new plane, but also as people from destinations across south east Asia and Australia/New Zealand look to travel to destinations in the northern hemisphere via Singapore in order to experience the new standards in customer comfort established by the A380. Indeed, the three-class airline features a new cabin class – the Singapore Airlines Suites – described by the airline as ‘a class beyond first'.

Grand Prix To Boost Visitor Numbers

The Federation Internationale de l'Automobile (FIA) has given approval for Singapore to host Asia's first ever night race in 2008. Now, construction can begin on modifying the streets of the city state to host one round of the world's premier racing event, scheduled for 28 September 2008.

BMI believes that the hosting of a Singaporean grand prix will be a clear boon in attracting new visitors to the city state. The television coverage of the event will provide institutions like Raffles with a clear shop window to the world and the entire city state will be the focus of the world's media over the grand prix weekend. Supporters of grand prix racing tend to be reasonably affluent, so shopping centres and nightlife venues should receive extra revenue from incoming travellers.

Opening Up The Lucrative KL-Singapore Route

The long-awaited liberalisation of the lucrative Singapore-Kuala Lumpur route looks set to commence in early 2008, following a meeting between the Singapore and Malaysian Transport Ministers in early November. In late October 2007, the Malaysian government formally gave Air Asia permission to commence flying the route twice daily. As a reciprocal act, the country will also allow two flights by a Singaporean based budget carrier into Kuala Lumpur each day. Tiger Airways has formally expressed an interest in servicing the route. However, it will be up to the government to nominate a carrier in the near future.

Chapter 1 - New This Quarter

Airlines

Strengthening Demand In Indonesia, China & India To Boost Visitor Arrivals

Key Forecasts

Exchange Rate Factors Remain Broadly Neutral

Bird Flu

Chapter 2 - Market Overview

Tourism Outlook

Table: Singapore Tourism: Travel Historical Data & Forecasts

Table: Singapore Tourism: Historical Data & Forecasts

Singapore Tourism Sector SWOT

Chapter 3 - Macroeconomic Scenario

Economy Demonstrating Resilience

Table: GDP, Output & Population"

Chapter 4 - H5N1 Virus: Still on Radar Screens

Asia Tourism Business Environment Ranking

Table: Asia Travel & Tourism – Business Environment Ranking

Politics – Long-Term Risk

Overall Business Environment

International Tourism Receipts

Visitor Arrival Growth

Investment Environment

Shock Factor

Chapter 5 - Travel

Table: Singapore Leading Commercial Airlines 2005-2006

Table: Singapore Low-Cost Airlines: Key Players 2006

Special Focus: Falling Jet Fuel Costs

Table: Oil Price Forecasts

Hospitality

Table - Singapore: Singapore Hospitality Market Structure And Forecasts

Chapter 6 - Company Profiles

Singapore Airlines

Chapter 7 - BMI Forecast Modelling

How We Generate Our Industry Forecasts

Tourism Industry

Sources

Competitive Landscape for Asia Tourism Reports: Sample of Companies Ranked

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Comparative cross-border analysis assessing business and regulatory factors to rank Asia’s most competitive tourism markets. Indicators used include Political Risk, Business Environment Risk, Forecast International Tourism Receipts, Visitor Arrival Growth, Investment Environment and Shock Factors (taking account of any special factors such as terrorism, natural disasters and disease). Company SWOTs for leading resort, hotel, airline, travel and tourism operators in each market, including competitive intelligence on overall geographic presence, competitive positioning and relationships with international operators; % share of operator markets; % share of international arrivals and departures; % share of busiest domestic routes; main products and services; panregional expansion, merger and acquisition strategies.

Network of Asain Tourism Sources

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BMI's Asian Tourism Reports are based on an extensive network of multilateral organisations, government departments, tourism industry associations, chambers of commerce and company reports. Information sources include: