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The second day of Routes Europe kick started on Monday 23 April with a panel discussion on the state of Europe’s aviation industry.

With the International Air Transport Association (IATA) predicting that Europe’s aviation market will grow at 2.3% per year over the next two decades, adding an additional 550 million passengers by 2036, the concern is that airport infrastructure isn’t up to scratch, according to Rafael Schvartzman, regional vice-president, IATA.

“Passengers will double by 2036, but airport infrastructure isn’t being addressed as it should and European airspace is inefficient,” he said.

Schvartzman also noted that the passenger compensation system in Europe is not fit for purpose, saying “we need a more fair and balanced system.”

On a more positive note Mark Clarkson, EVP product development, OAG, revealed that with the increase in passenger traffic and low-fare travel, “airlines are increasingly looking at secondary markets and developing forgotten markets.”

According to data from OAG, European capacity grew by 3% in 2017, compared with the previous 12 months. Of this, low-fare seats accounted for 32%, up from 30.4% in 2016, emphasising the rise in the market of low-fare carriers, such as easyJet, Ryanair and Eurowings.

 

BA’s battle against LCCs

Meanwhile, an interview with British Airways’ (BA) Chairman and CEO, Alex Cruz, saw a packed-out conference room tune in to hear what Cruz had to say about the airline’s plans over the next few years and how it aims to battle the rise of low-cost carriers (LCC).

Referencing the airline’s centenary celebrations next year, Cruz stated that the airline’s focus is on showing the world that British Airways is “still the leader in its field, when it comes to the quality of the service and product it offers.”

On the subject of long-haul, low-fare flights, Cruz stated that when he first joined the airline in 2016, the challenge particularly with flights from Gatwick was how British Airways could continue being competitive while delivering a quality service.

“The trick has been our newly refurbished 777s,” he revealed, explaining that the aircraft’s cabin reconfiguration “has enabled us to compete satisfactorily with low-cost, long-haul services.”

The airline has also launched its new long-haul ‘basic’ fare together with its transatlantic joint business partner airlines: American Airlines, Finnair and Iberia on flights from London to Austin, Boston, Delhi, Denver, Dubai, Hong Kong, Lagos, Oakland, Philadelphia, Punta Cana and Singapore.

 

Aviation disruptors

A session on aviation disruptors covered the inevitable subject of Brexit, as well as political instability and security concerns such as terrorism.

bmi Regional’s CCO, Jochen Schnadt, highlighted that the primary issue with Brexit is the level of uncertainty it creates. “If you ask 100 people what it means you get 101 answers,” he said, before adding that Brexit is a massive disrupter to the industry.

While Leon Verhallen, head of aviation marketing at Brussels Airport underlined the need for government support to maintain confidence in the aviation market in the light of recent attacks.

“After the Brussels attacks some US travellers weren’t allowed to travel to Belgium,” he said, divulging that as a result of this disruption Boeing had to meet with its Belgian clients in the Netherlands.

As the second day of pounding the show floor and networking with airlines and airports drew to a close, delegates and exhibitors alike headed off into the night for the Routes Europe 2018 marketing awards ceremony at Bilbao’s Euskalduna Conference Centre.

 

Inset image: British Airways Chairman and CEO, Alex Cruz (right) with John Strickland, director, JLS Consulting.

Aviation industry leaders from more than 300 airports and 100 airlines have converged in Bilbao, Spain for the 13th annual Routes Europe event this week, to negotiate new networks and services throughout Europe.

Airports have been busy pulling out all the stops (literally champagne corks were flying on the show floor) as the first day of the exhibition and conference drew to a close on Sunday 22 April.

Meanwhile in the conference sessions, a keynote address from the Basque Government’s transport planning director, Janire Bijueska highlighted that Spain’s Basque region is ripe for investment and trade with three airports serving 56 destinations.

Bijueska cited that as Northern Spain’s largest airport, Bilbao connected around 5 million passengers to cities across Europe last year (an 8.4% increase when compared with figures from 2016).

 

The low-cost landscape

Meanwhile, Ray Webster, easyJet’s former CEO, gave an enlightening talk on his life in aviation and the low-cost carrier (LCC) landscape.

Having been made easyJet’s CEO in 1996, Webster is credited with developing one of the biggest LCC brands, not only in Europe, but around the world.

“One of my biggest challenges when I first joined the airline was to get Stelios away from pricing,” Webster said, revealing that when he started with the airline, its founder, Sir Stelios Haji-Ioannou, would monitor the flights constantly throughout the day and then adapt the seat prices accordingly.

“I’m quite confident at coding, so I wrote a programme to set the initial pricing model into the system,” he added, explaining that this enabled the airline to monitor the sales rate and adjust the price accordingly with the number of remaining seats.

While he may have been instrumental behind success of easyJet’s low-fare model, Webster confessed that he isn’t a fan of the long-haul, low-cost sector. “I understand the appeal for young people and students, but I don’t see it becoming a mainstream market. If you’re travelling six to eight hours you want some level of comfort,” he said.

He also cited that he believes high-speed rail travel is currently the biggest threat to LCCs within Europe. Describing France’s high-speed rail network as “quick, efficient and fatigue-free,” he noted that when travelling by train there’s no hassle of waiting around at an airport and passengers travelling by rail can carry on with their work without interruptions.

Referencing poorly utilised airports (such as Luton and Stansted) as instrumental to easyJet’s success in the early days, Webster enthused that dedicated low-cost terminals are key to ensuring optimal performance from a low-fare carrier in today’s market. He concluded that the joy of working with a start-up, as easyJet was when he joined, is that “you’ll attract like-minded, passionate, talented people who are prepared to put in the hours.”

 

The airport-airline partnership

Wrapping up the conference sessions for the day, Edinburgh Airport’s CEO, Gordon Dewar and easyJet’s group director of strategy and network, Robert Carey discussed the importance of the airline-airport partnership.

“The cost element is a crucial part of our business, but that doesn’t mean we believe in doing things on the cheap,” said Dewar. “It’s all about working in a partnership, building trust and being constructive so that when there’s an issue we can address and respond to it.”

The pair highlighted four areas they are focused on in terms of their relationship: Developing new product offerings, such as Worldwide by easyJet; forming an innovative cost structure that benefits the airline, airport and passengers; building infrastructure that can cater for future demand; and finding new opportunities for example accessing multiple data sources to gain a better understanding of the local market and to develop profitable routes.

Images: Top – Janire Bijueska, transport planning director, Ministry of Economic Development and Infrastructure, Basque Government delivers her keynote address; Bottom – Ray Webster (right), former CEO of easyJet discusses the low-cost landscape with Nigel Mayes, senior vice-president, consulting & product development, ASM.

EUROCONTROL (the European Organisation for the Safety of Air Navigation), alongside more than 40 industry partners – primarily air navigation service providers (ANSPs) – have unveiled a new 10-year contract with British Telecommunications (BT) for the provision and management of secure and resilient New Pan-European Network Services (NewPENS).

The contract, which has an estimated value of €50 million, was signed in Brussels, following a common procurement action, on 17 April 2018.

Connecting around 100 locations across 47 countries in and around the EUROCONTROL area, the network will be accessible to all air traffic management (ATM) stakeholders, so they can transfer business-critical data  securely and in a cost-efficient way.

The successor to PENS, which was launched in December 2009, NewPENS is a major upgrade – in service management and network architecture – and the backbone for cross-border data and voice communications for the Network Manager, ANSPs and other ATM stakeholders.

“NewPENS is an unparalleled common procurement contract in pan-European air traffic management,” stated Eamonn Brennan, director general of EUROCONTROL and vice-chairman NewPENS Top Management Board.

“With air traffic on the rise, NewPENS will provide solid support to European aviation, securing cross-border network connections and underpinning safety-critical applications,” he added.

In addition to being future-proof, NewPENS’s features include being available to a wider range of stakeholders, including the military, ATM providers, airlines, airports and meteorological services as well as ANSPs, and the option of different tiers of service – from entry-level to mid-level, through to high-end.

Bas Burger, BT’s CEO of global services, noted that “with air traffic expected to double in the years ahead, the need for secure and highly reliable communications has never been greater and of more importance.”

He added: “The networking infrastructure we will put in place for the NewPENS community will ensure ultra-high levels of resilience and security for air traffic controllers to help guide planes safely to their destinations.”

Header image: Network Manager Operations Centre; Inset image: Signing of the NewPENS contract on 17 April 2018

Dublin Airport, which has flights to 195 destinations in 42 countries and is served by a number of regional and low-fare carriers including Ryanair, Norwegian, flybe, Loganair and Aer Lingus, has joined a growing number of airports turning to solar power.

Under the management of Dublin Airports Authority (daa) and in partnership with the Irish Electricity Supply Board (ESB), the airport has installed 268 solar panels on top of its reservoir system to provide more than half of the reservoir’s annual energy requirements.

Providing 500 million litres of water – the equivalent of 200 Olympic-sized swimming pools – to the airport’s two passenger terminals, the reservoir system also services all the offices and businesses on the airport campus.

Explaining how daa is working closely with ESB to identify opportunities to use low-carbon technologies to improve energy performance at the airport, Dalton Philips, daa’s CEO, said: “We are committed to working in partnership with ESB to reduce our energy consumption by 33% by 2020.”

The airport is already carbon accredited, as part of a Europe-wide airport carbon management certification programme that covers more than half of European air passenger traffic.

“We want to be leaders in this area and help Ireland meet its national obligations in the process,” said Philips, revealing how in the past three years, Dublin Airport has reduced its carbon footprint by 5,000 tonnes, which is equivalent to a 10% reduction in carbon emissions under its control.

“We are looking forward to building on this performance and making even more energy savings that will also benefit the travelling public through sustainable environmental performance and annual cost savings,” Philips concluded.

Header image: ESB CEO Pat O’Doherty and daa CEO, Dalton Philips, at Dublin Airport’s solar farm.