“I don’t see facts to support optimism.” That was the harsh message for the airline industry in the state-of-the-industry address by IATA director-general and CEO, Giovanni Bisignani as he opened the 65th AGM of the International Air Transport Association in Kuala Lumpur, Malaysia.
Predicting a $9 billion loss for airlines this year, despite a $59 billion drop in the overall fuel bill, Bisignani called for more to be done by governments and by airlines’ partners to help deliver a turnaround. In particular he singled out airports, which he referred to as “monopoly suppliers”, which take “11% of [airline] revenues”. Congratulating some which “are sharing the burden of change”, including Malaysia Airports, Singapore, Dallas/Forth Worth, Geneva and Thai Airports, he rounded on those who helped the bill to the monopoly suppliers grow by $1.5 billion in 2008, and by a further $1.5 billion in the first six months of 2009.
Included among the guilty on the DG’s ‘IATA Wall of Shame’ were the BAA and UK CAA for an 86% increase in charges at Heathrow, Delhi and Mumbai for their 207% increase over four years and the Eurocontrol states of Denmark, The Netherlands and Poland for proposing increased charges ranging from 27% to 32%, all at a time when the industry is enduring its toughest economic challenges.
“Enough!” Bisignani declared. “There is no room for this nonsense in our future. The shape of everything must change, including the comfortable position of our happy monopoly suppliers.”
The DG also called for a change amongst the GDS companies. "We cannot accept that Western GDSs charge around $4 per transaction when China TravelSky does the same job for $0.50. This must change,” Bisignani demanded to rich applause.
Governments, meanwhile, should understand that the air transport industry can help protect their citizens, improve efficiency, save jobs and support economic growth. “But only if we work together,” stated Bisignani.
One-stop security checks must be the future to help reduce the $5.9 billion airline security bill. And slot auctions and legislation on passenger rights are no solution, Bisignani claimed. Stimulus monies should be used to improve infrastructure. “A Single European Sky is closer than ever. And I hope that President Obama can make NextGen a reality. Combined, the programmes can save 41 million tonnes of CO2 and more than $21 billion, but only if governments deliver,” the DG added.
Regarding stimulus money, Bisignani made it clear that the airlines do not want bailouts. “All we want is access to global capital, but old rules stand in the way of a healthier industry. If we cannot pay the bills, saving the flag on the tail will not save jobs,” he warned. “Access to markets and capital is critical to all of our businesses. For our industry, with $48 billion in losses since 2001, the time for change is now,”
Concluding on the overriding commitment to safety, Bisignani first paid tribute to those lost in the Air France A330 crash on 1 June. He reminded delegates that although the industry flew 2.2 billion people safely in 2008, but demanded, “Our goal must always be to do even better: zero accidents, zero fatalities.”
Bernie Baldwin, editor, Low-Fare & Regional Airlines/LARAnews.net
Kuala Lumpur
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