Having been confirmed as director general of IATA just eight months ago, Breaking Travel News catches up with Tony Tyler at ITB Berlin 2012 to find out what is on the agenda for the organisation this year.
Breaking Travel News: How are you finding your new role as chief executive and director general of IATA? Has the position met with your expectations?
Tony Tyler: The role of chief executive and director general of IATA is an immense challenge and a great privilege. It is very different from running an airline – I am very conscious that I need to represent the needs of our 230+ members, and that means a lot of travel and a lot of events and one-to-one meetings.
My expectations of the IATA staff were high – and they have not let me down. We have a dedicated and knowledgeable team and a great deal of important work to achieve.
BTN: What’s on the agenda for IATA this year?
TT: IATA will continue in its mission to represent, lead and serve the airline industry.
Safety is our number one priority and we will look to increase the success of our IOSA and ISAGO audits, which have played their part in making 2011 the safest year ever for the airline industry. We also mean to keep up our advocacy on issues such as new security regulations, environmental taxation and user charges.
We have some important changes to our settlement systems, to protect the industry’s money, and we have a number of exciting and innovative projects to improve the passenger experience and business efficiency for airlines.
I am also very keen to see further progress on the ‘Checkpoint of the Future’ – this is a vital project to make passenger search more secure and more convenient. We will use a combination of new technology and a risk-based approach, involving the use of customs data and known-traveller programs, to reduce queues.
BTN: What do you see as being the single most important challenge facing the aviation industry today? How are you addressing this?
TT: Our biggest challenge is always safety. It is our top priority and it must always improve. But aviation has no shortage of challenges—financial sustainability among them. We are expecting a 0.6 per cent profit margin this year, on revenues of $600 billion – that’s a lot of turnover without much leftover.
If that expectation is met, then the airline industry will have lost over $26 billion since 2001 on revenues in excess of $5.5 trillion. IATA will be working hard to deliver value to our members that can be measured on their bottom line.
Aside from the economics, we need to work harder to make governments understand the power of aviation connectivity to drive economic growth. Regrettably, some governments seem to regard aviation as a nuisance which is best restricted and taxed. So we need to work with them to reverse that trend.
BTN: Which aspects of the Simplifying the Business programme are you most focused on for 2012? In what ways do you support airlines in implementing any changes?
TT: Simplifying the Business has a number of important projects each of which plays a role in a vision for a more efficient industry. E-ticketing, bar-coded boarding passes and self-service kiosks are great enablers for industry innovations.
Our job is to work with all the stakeholders to set the standards which can then be implemented where and how it makes most sense in serving passenger needs—particularly the desire for more choice, convenience and control over their journeys through self-service.
In 2012, StB is focusing on reaching critical mass regarding the electronic miscellaneous documents (EMD) project.
By the end of the year, airlines representing 75 per cent of passenger volumes will be issuing electronic miscellaneous documents - offering more access to more services for passengers, and saving processing costs for airlines. We continue our focus on reducing baggage mishandling by up to 50 per cent with our Baggage Improvement Program. 2012 will also see a massive ramp-up of our Fast Travel initiative - this year we are aiming for an additional 100 airline/airport pairs.
Another key project that we are launching will create more flexible alternative channels for the airlines to offer their product innovations to the travel agent community.
BTN: Having announced Vision 2050 last year, highlighting the need for the industry to unite, to challenge Governments and to engage Asia Pacific as the biggest market. What has the response so far?
TT: Vision 2050 was more of an exercise in imagining how the industry could look in 40 years’ time, rather than a set of concrete proposals. It is certainly true that the centre of gravity of aviation is moving eastward.
We expect 877 million more passengers in 2015 compared to 2010, and 212 million of them will come from China alone.
By 2030, the OECD reckons that there will be 3.2 billion middle-income earners in Asia-Pacific. So this is going to radically alter the size and shape of our industry, and Governments in the region will have a real opportunity to influence aviation’s ability to drive growth and prosperity for the world.
Equally, if Asia-Pacific is to maximise the advantages from aviation, then it needs to continue to put aviation at the heart of its connectivity and trade strategies, and to make progress with the Seamless Asian Sky project to make air traffic management much more efficient.
BTN: How does IATA view the new European Union-sponsored Emissions Trading Scheme? Do you feel there is a more effective way of addressing environmental concerns?
TT: Europe deserves credit for pushing market-based measures up the global agenda as an essential part, if temporary, of the solution for addressing aviation emissions.
But Europe must recognise that aviation is an industry that is built on global—not regional solutions. And the extra-territorial aspects of the scheme have been seen as an attack on sovereignty by over 40 states.
The International Civil Aviation Organization is the place to build global agreement among governments on issues such as climate change.
They already have a successful track record on noise and safety. And at their 2010 Assembly they agreed 15 principles to guide a global framework on economic measures, to be agreed at the 2013 Assembly.
European states need be sincere participants in the process and facilitate ICAO’s success.
BTN: What are your predictions for the aviation industry over the next five years?
TT: History is usually a good indicator of what the future holds. If the trends we observed over the last decade continue, we can expect that aviation will continue to grow (at nearly six per cent per year), to become safer and to provide great value and even better convenience to passengers and shippers.
That is all good news. But it would also be fair to say that we can expect the unexpected. Airlines have transformed themselves over the last decade of crises and shocks.
I believe that there is still more innovation to come. But I would also like to see the partners in the industry’s value chain work together more closely—to share risk and reward more equitably and to reinforce aviation’s resilience.
We are in this together so it makes sense to rally a team effort that is focused on win-win solutions.