Singapore Airlines signs SGD300m outsourcing deal with IBM

Airline Industry Information, Oct 26, 2004

AIRLINE INDUSTRY INFORMATION-(C)1997-2004 M2 COMMUNICATIONS LTD

Singapore Airlines has signed a SGD300m deal with IT company IBM to outsource the majority of its information technology operations at a cost of some 130 jobs.

IBM's staff in Singapore will manage the new account including the airline's computer support desks and some help desks, according to Singapore Airlines. Staff at Singapore Airlines have been given the opportunity to join IBM as part of the seven-year deal.

The airline has been cutting costs for most of 2004 in an attempt to absorb the rise in fuel costs and cope with the volatile nature of the airline market. The airline says it expects up to SGD10m in one-off costs relating to the 130 job cuts but then believes it will save SGD15m a year through the new deal, reports Reuters.

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