Innovation in Airline-Airport Cooperation

The International Air Transport Association (IATA) called for innovation and a renewed agenda of cooperation in the relationship between airports and airlines. “We need a common and forward-looking agenda that builds on past successes and puts innovation at the heart of our common issues. Airports and airlines share a common interest in making aviation safer, more secure, user-friendly, operationally efficient and environmentally responsible. Combined, these are our common license to grow,” said Tony Tyler, IATA’s Director General and CEO.

Tyler’s remarks came in a keynote address to the world’s airports at the Airports Council International (ACI) World Annual General Assembly in Marrakech, Morocco. Tyler highlighted six areas where airports and airlines can enhance cooperation to innovate and deliver value: safety, security, improving the customer experience, infrastructure investments, environment and charges.

Safety: “Safety is our top priority and requires a team effort. We are already doing good and important work together in critical areas such as runway safety. Addressing ground safety and reducing the $4 billon cost of ground damage is another area. ACI contributed to building the IATA Safety Audit for Ground Operations (ISAGO) which has become the global standard. Seattle Tacoma and Amsterdam Schiphol now mandate ISAGO as a requirement for all ground operators at their airports. I urge others to do the same. If we are serious about safety—and we are—there is no reason not to,” said Tyler. There are 128 ISAGO registrations covering 83 ground service providers at 104 airports, with 25 airports having indicated their support of ISAGO.

Tyler also called for cooperation between IATA and ACI in promoting the IATA Ground Operations Manual (IGOM). IGOM will be launched in 2012 to globally harmonize ground operations and will become a tool to address deficiencies in safety and efficiency, particularly in rapidly developing markets.

Security: IATA is promoting a dialogue among industry and government stakeholders on a Checkpoint of the Future (CoF) that takes a risk-based approach with the aim of allowing passengers to move through security without stopping, unpacking or removing outerwear. “Airport security is effective but it needs a major re-think to meet growing passenger numbers and calls for less intrusive processes. Convenient and effective security will make air travel a more compelling product. And the less time travelers spend queuing, the more time they will have for airport shopping, eating and entertainment,” said Tyler. Tyler also noted the cooperation with ACI on Secure Freight, which will secure the supply chain based on global standards and best practices.

Improving the Customer Experience: “Airlines and airports worked together to improve efficiency and passenger convenience through IATA’s Simplifying the Business program, starting with e-ticketing, common use self-service (CUSS) kiosks and bar coded boarding passes. These are three enablers that give us an enormous opportunity to innovate the passenger experience even further through Fast Travel,” said Tyler. Fast Travel is a suite of self-service options to add further efficiency to the travel experience from check-in to baggage retrieval that has been implemented in airline-airport partnerships including SAS and Copenhagen Airport, the first to implement all five Fast Travel projects.

Tyler urged airlines and airports to work more closely on baggage delivery accuracy to support airlines as they unbundle their product, including baggage charges. IATA’s Baggage Improvement Program helped Air New Zealand and Auckland International Airport reduce baggage mishandling by 75%.

Tyler also called for more airport partnerships to promote e-freight. Implementing e-freight will lower costs across the supply chain, improve efficiency, reliability, accuracy and security, and has the potential to contribute to shortening process cycles by up to 24 hours.

Environment: Airports and airlines are united with air navigation service providers and manufacturers to tackle aviation’s carbon emissions. To achieve the industry’s commitments to improve fuel efficiency by 1.5% annually to 2020, cap net emissions from 2020 and cut net emissions in half by 2050 (compared to 2005), Tyler called for innovative cooperative approaches. “I encourage airports around the world to team-up with airlines. Some airports—Madrid-Barajas, Detroit and Stockholm-Arlanda have allocated land to grow source crops for sustainable biofuels. Zurich Airport has mandated the used of fixed ground power. These are all important moves to improve our environmental performance,” said Tyler.

Infrastructure Investments: “Building infrastructure to handle growth is a challenge best handled in close cooperation between airports and airlines. This includes working together in the airport master planning to ensure that investments are being made that match the needs of airlines,” said Tyler. He pointed to London’s Heathrow Airport where an ongoing dialogue between the airport operator and the airlines is helping, among other things, to promote capacity expansion, optimize existing capacity, take advantage of developing technology, mitigate noise and emissions, enhance surface access and improve operational resilience. “There are robust discussions on price, affordability and service standards, but what is important is to have an open and honest dialogue on our common future and a rolling capital expenditures (CAPEX) plan to accommodate aviation’s dynamic nature,” said Tyler.

Cost-Efficiency: Tyler also reiterated the importance of cost efficient, affordable airports with charges in line with International Civil Aviation Organization (ICAO) principles. “Airlines and airports are in a business relationship. And it is a tough business. Airlines are expected to make a margin of 1.2% this year and 0.8% in 2012. Airports will be under similar pressure. In fact, regardless of the economic situation, there is a natural tension in the supplier-customer relationship between airports and airlines. But let’s keep focused on the fact that airlines and airports both need to be financially sound financial partners that are able to plan and grow our businesses together,” said Tyler. Tyler proposed innovation in four aspects of the ongoing discussion on airport charges:

• Airline engagement in major capital expenditure development
• More transparent and meaningful consultation processes
• Longer-term charges agreements which include service level agreements
• Development of innovative concepts for risk sharing

ACI

IATA congratulated ACI on 20 years of industry leadership. “ACI—the collective voice of the world’s airports—has played a critical role in developing global aviation. And I am confident it will continue to do so, I hope in even greater partnership with IATA and the airlines. With openness to innovation and a common understanding of the issues and the potential, I am convinced that together we can direct the future of a sustainable aviation industry that is an even more successful driver of national and global economies,” said Tyler.

Read Tony Tyler’ full speech