Sabre Airline Solutions has seen significant growth worldwide in 2005, achieving a more than 50 percent increase in revenue year-over-year. This marks the third consecutive year of growth for the consulting unit, with engagements more than tripling since 2002.
Sabre consulting engagements in 2005 revolved around significant industry trends tied to cost control and revenue performance.
Airline clients’ consulting needs were particularly related to turnaround and restructuring, revenue management, development of airline alliances and airline planning. In addition, Sabre Airline Solutions consultants established a world-leading practice in airline planning this past year.
Highlights of 2005 consulting engagements included bringing value to carriers in the following areas:
Turnaround and Restructuring:
Aloha Airlines—In the area of turnaround and restructuring, Sabre Airline Solutions’ consulting team worked in concert with the management of Aloha Airlines to develop the restructuring plan that helped the carrier recently emerge from bankruptcy.
According to David Banmiller, Aloha Airlines president and CEO, “Sabre’s consultants provided valuable hands-on services to Aloha during the year-long process of restructuring. They understand the economics of airline business. Their practical work helped to drive commercial and operational benefits for our company, and assisted us to attract new investors. Their efforts, in partnership with Aloha’s team, contributed to a rapid emergence from bankruptcy, reduced Aloha’s costs by $75 million on an annual basis, and paved the way for Aloha’s future with a low cost base and strong balance sheet.”
The changes made as a result of the restructuring will provide long lasting benefits for the airline. Sabre’s work included network and fleet planning, cargo, crew and airport manpower planning, distribution, alliance analysis, pricing and revenue management, and fuel conservation.
Gulf Air—Sabre consultants also recently helped Gulf Air realize financial benefits of more than $30 million a year. The 18-month ‘no gain, no fee’ consulting engagement involved changes in seven areas of the airline’s operations, and leveraged Sabre products to help the airline market its schedule, sell tickets, serve its customers and operate more efficiently.
Payment for the project was dependent on the Sabre consultants helping to achieve measurable improvements in Gulf Air’s fuel consumption, pricing and revenue management, sales, distribution, e-ticketing, on-time performance and airport operations. The deal was signed with agreed-upon criteria for measuring improvement.
Yemen Airways—A recent engagement with Yemen Airways is another example of superior, rapid results delivered by Sabre Airline Solutions consultants in the area of turnaround consulting. After six months of working with Sabre consultants on its turnaround efforts, Yemen Airways realized benefits of more than $6 million.
Air One—Valuable pricing and inventory management strategies were developed by the Sabre Airline Solutions consulting group at Air One. In a very competitive marketplace with both traditional network and low-cost carrier competition, Sabre consultants worked side-by-side with Air One management and analysts in developing successful market-specific pricing and inventory tactics. Also key to the success of the project was the development and implementation of business process improvements.
According to Giorgio De Roni, Air One head of Network & Marketing, “Sabre’s consultants provided both valuable higher level strategic and detailed tactical assistance. They were able to develop, implement and monitor successful pricing and inventory management tactics specifically for our marketplace. The focused initiatives, in partnership with the Air One revenue management team, contributed to double digit unit revenue improvement year-over-year.”
TACA International Airlines—An airline planning engagement can include many activities ranging from alliance evaluation to code share analysis, long- and short-term network planning and fleet optimization. This represented a significant area of growth for Sabre Airline Solutions’ consulting business in 2005. The team engaged in a number of successful planning projects with airlines worldwide, including TACA International Airlines in Latin America.
Sabre consultants worked with the management at TACA International Airlines based in Salvador to develop a five-year network and fleet plan.
“Sabre’s quantitative and detailed approach helped us to evaluate a number of network scenarios and strategic partnership options with other airlines,” said Roberto Kriete, CEO of TACA .
“In 2005, the consulting group achieved significant growth and expanded its client base in all regions of the world,” said Nejib Ben-Khedher, senior vice-president of the consulting practice for Sabre Airline Solutions. “More importantly, we contributed exceptional value for our clients, enhancing their performance and establishing Sabre as their partner. Last year Sabre Airline Solutions doubled its revenue in North America, China, Europe and the Middle East. We offer unmatched capabilities from hands-on airline experts backed by Sabre’s leading decision support tools. We would like to be known, not for the number of engagements that we are signing, but for the true value that we deliver to our clients in short time frames.”