Singapore Airlines CEO Urges Consolidation

SYDNEY, Australia (AP) -- Singapore Airlines Chief Executive Chew Choon Seng said Sunday the global airline industry needs to consolidate as soaring oil prices damage profits.

He noted Singapore Airlines and Qantas are discussing sharing maintenance facilities for the new Airbus 380 super jumbo, which both carriers plan to fly.

''It makes sense that neither of us duplicate facilities but rather put our heads together and see where we can have joint efforts and share facilities and thereby spread costs,'' Chew told the Nine Network's Business Sunday program.

Singapore's transport minister, Yeo Cheow Tong, told the program that a merger between Singapore Airlines and Qantas Airways remains unlikely under present regulatory conditions.

''I don't see the two airlines agreeing to a merger at this point of time because there are many, many issues to be discussed,'' Yeo said.

Last month, Qantas CEO Geoff Dixon said the carrier likely would form an alliance with an overseas carrier in the future, and named Singapore Airlines among possible partners.

Dixon supports efforts to relax a foreign ownership cap in Qantas. Under current rules, foreign airlines can own no more than 25 percent of its stock and limits overall foreign ownership to 49 percent of the carrier.

Singapore Airlines, Asia's largest carrier by market capitalization, said in May its net profit hit a record 1.39 billion Singapore dollars ($817 million) in its financial year ending March 31, despite spiking jet fuel prices and rising competition from Asia's growing number of budget carriers.