Local airlines to be hit by 'price war': report

Singapore Airlines takes on Qantas, Emirates alliance with discounts, more flights.

Singapore Airlines has increased flights to Australia to compete against the new alliance between Qantas Airways Ltd and Emirates Airways, resulting in a price war that could hurt all the carriers, The Australian Financial Review reports.

According to the newspaper, the airline has increased the number of flights to Australia to 121 a week from 108 a week in November to gain market share, particularly from passengers who prefer to travel to Europe through Asia rather than the Middle East.

The airline said it needed to discount fares to fill seats as the operating environment remained challenging in June.

Industry sources told the AFR that other airlines also suffered falling yields for traffic to Europe, partly because of Singapore's strategy of boosting capacity.