5 Mar 2002

AUSTRALIA: Cheong jumps airline before push.

(See also Tailspin of his own making)
By Eric Ellis

THE crisis in the global airline industry may have claimed another victim, with the revelation that Singapore Airlines chief executive Cheong Choong Kong will step down next year.
Mr Cheong, who last year made an ill-fated attempt to play kingmaker at the now failed Ansett Airlines, told CNN he will retire from SIA by June next year.
His revelation follows 18 months of missteps for the airline on Mr Cheong's watch, beginning with the October 2000 crash in Taipei that killed 82 people and heightened by Ansett's collapse. Mr Cheong admitted earlier this year that SIA could post its first-ever loss since the service began in 1972.
Profits were down 88 per cent in the six months to September 30. SIA has blamed the September 11 fallout for much of its woes but the airline was in difficulties before the industry impact of the US terrorist attacks.
Since becoming chief executive in 1996, the Adelaide University-educated Mr Cheong has been attempting to diversify SIA by buying expensive stakes in airlines in Australia, New Zealand and Britain. But those attempts have not panned out for the amiable 62 year-old. SIA has lost as much as $500 million from Air New Zealand's failure and its 50 per cent stake in Sir Richard Branson's Virgin Atlantic is worth about half the $1.6 billion SIA paid in early 2000.
SIA also made an ill-fated effort to buy Air India last year. Mr Cheong has been with SIA for 30 years. SIA shares shot up 4 per cent in Singapore trading yesterday after the company confirmed Mr Cheong's remarks.
While Mr Cheong's departure has been said to be unrelated to SIA's problems, there has been speculation in Singapore's close-knit government-linked business community that he was under pressure to step down.
SIA recently appointed Koh Boon Hwee, regarded as one of Singapore Inc's safest hands, to be chairman. Mr Koh had been stewarding Singapore Telecom, where Brigadier-General Lee Hsien Yang, youngest son of Singapore's elder statesman, Lee Kuan Yew, has been chief executive.
Australian Charles Goode is also a SIA director.
Attention is now focused on Mr Cheong's successor at the government-owned airline.
A favoured candidate is Lieutenant-General Bey Soo Khiang, head of Singapore's defence force until early 2000.