Austin Reid - CEO bmi comments at Airport Capacities Issues Conference - London 9 April

10th Apr 2002

In a speech to a major aviation conference in central London today, Austin Reid, chief executive of bmi british midland, said that airlines must consistently make the needs of consumers their number one priority.

“Airline passengers - like all consumers - are becoming more demanding and more discerning. The arrival of the internet and 24 hour news media have given consumers access to more information than ever before. Consumers - often using new technology such as the internet - are more likely to shop around for better deals than they used to, more likely to share their experiences of the goods and services they buy.” It is more important than ever, therefore, to focus on consumers and not take their business for granted.

In addition, as demand for greater corporate social responsibility (CSR) by business grows, consumers will not just look at where airlines fly to, what they charge and what level of service they get for the fare. They will increasingly ask questions about the industry’s greenhouse gas emissions, noise emissions, fuel efficiency etc- how we measure and manage our impact on the environment and on the communities in which we operate. “We have a strong track record in environmental management, but we must continue to be responsible and - crucially - we must be seen to be seen to be responsible by consumers. Our good actions and performance must be supported by effective communication.”

Passenger demand for air transport has trebled in the last twenty years and is likely to double over the next twenty years. “We must ensure that there is the infrastructure and capacity to meet that demand, balancing the needs of passengers and the economy with the needs of the environment and communities affected by the aviation industry. This will require the government to make some difficult but necessary decisions if the UK is to stay in the Premier League of world aviation.”

Safety and value for money are key drivers for consumers. “The UK airline meets high and stringent safety standards. But we must never be complacent and never stop striving for improvement.”


Price is another key factor for passengers. “Full service carriers have to work harder at demonstrating value for money to consumers. An imbalance has developed between the `value propositions` of no frills and full service airlines. Full service airlines have a range of products and these have to be priced appropriately. Too often fares in the full service market are not recognised as offering good enough value. We must work hard to change that perception and be better at ‘selling’ the range of services that full service airlines offer and no frills carriers do not.”

Finally, Austin Reid highlighted the contribution that liberalisation can make to increasing choice and competition for consumers and driving down fares.

“Just as the European market has grown through lower fares and greater choice, so could the trans-Atlantic market from Heathrow. Heathrow is growing slower than some of its competitors, such as Amsterdam, Paris and Frankfurt - simply because the current UK-US regulations do not allow it to offer the choice, competition and, therefore, lower fares that these other airports can. Reform at Heathrow is overdue.”



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