Budget carriers Scoot and Tigerair are not moving to Changi Airport's future Terminal 4 (T4).
This is despite the promise of savings from a widespread use of self-service options for passengers that will reduce the need for increasingly expensive labour.
Scoot's chief executive Campbell Wilson said that the terminal, which opens in 2017, is not suitable for the airline's operations because Scoot flies the Boeing 787 and Boeing 777 and there are only four contact gates for such wide-body aircraft. The remaining 17 gates and attached aero bridges are for smaller planes, such as the Airbus 320 and Boeing 737.
"This means we will have to bus passengers to and from the terminal and aircraft, which is an inconvenience," he told The Straits Times.
With plans to grow its fleet to 20 planes by early 2019, "T4 will not be able to accommodate our operations", said the head of the Singapore Airlines-owned long-haul budget carrier.
Changi Airport Group has said that so far, Malaysian carrier AirAsia, along with its affiliates Indonesia AirAsia and Thai AirAsia, as well as Korean Air, Vietnam Airlines and Cathay Pacific will operate out of T4, which will be able to handle up to 16 million passengers a year.
If Scoot does not move to T4, Tigerair will not move either, said Mr Lee Lik Hsin, chief executive of Tigerair, which is an SIA subsidiary.
Both airlines currently operate at T2, alongside SIA and its regional arm, SilkAir.
Mr Lee said: "Being part of the SIA group, it is important for us to leverage on all possible synergies.... We have considered all the various issues and the bottom line is that it is important for us to be in the same terminal as Scoot."
This is crucial as the two carriers are pushing for closer ties, including selling each other's tickets and growing the number of passengers connecting from one airline to the other through Changi Airport.
Mr Wilson declined to divulge numbers, but said that connecting traffic has more than doubled in the last few months and will continue to grow strongly.
Tigerair, which used to operate at the Budget Terminal until it was torn down to make way for the future T4, has stressed many times that closer ties with the SIA group is a key strategy to turn its loss-making business around.
Mr Lee spoke to reporters via teleconference yesterday after the airline announced a $1.7 million net loss in the three months from April to June, from a $65.2 million loss a year ago. He said the team will continue to work towards profitability, which includes growing non-ticket or ancillary revenue.
The airline has, for example, launched a neighbour-free seating scheme on selected routes, offering passengers the option of having an empty seat next to them for a fee to be determined through bidding.
"Ancillary revenue has been relatively stable but, of course, we would like for it to grow more," said Mr Lee.