The rise of private charter and the challenges in business travel will have a decisive influence on the industry, but the key is to boost passenger confidence, says Sunil John
The International Air Transport Association (IATA) must step up its communications efforts, provide common guidelines and rally all industry stakeholders to boost confidence in the aviation sector, observed a panel on ‘Airline Strategies versus today’s reality’ at the eighth Arab Aviation Summit in Ras Al Khaimah, UAE.
Describing the aviation sector’s response to the crisis emerging from the pandemic as ‘timid’, Sunil John, President – Middle East of BCW and Founder of ASDA’A BCW, said the aviation sector’s current challenges can’t be addressed by airlines, airports, or tour operators alone but “global organisations such as IATA that must bring a commonality of approach and an industry-wide response regarding the safety and vaccine protocols to benefit the sector.”
Moderated by broadcast journalist Eithne Treanor, the panel discussion was also addressed by Linus Benjamin Bauer, Founder & Managing Director of Bauer Aviation Consultancy; and Peter Morris, Chief Economist at Flight Ascend Consultancy.
Sunil John said there is pent-up demand for travel now, but the key is to “build confidence among people who are not ready to fly, assure them of their safety and how they can navigate the various protocols. Aviation is sentiment-driven. Right now, the sentiment is all gloom and doom. Building confidence will happen when the aviation sector has clear and honest communication that addresses passenger anxieties. They must lead from the front. A proactive, courageous stance is needed for the aviation industry today.”
“The United Arab Emirates will take a lead role in driving the recovery of the aviation sector,” added Sunil, “with Expo 2020 Dubai, playing a decisive role in boosting the prospects of both the aviation and tourism sectors. The nation is at the centre of the world and we have the opportunity to convert the pent-up demand for people to get on planes and travel.”
He cited the success story of Ras Al Khaimah in driving domestic tourism as “a smart strategy’ that led to near 100 per cent occupancy at hotels in the emirate during the pandemic year, and the RAK International Airport gaining market share despite the pandemic through “flexible pricing attracting low-cost airlines.”
Sunil said an emerging trend for the sector will be the rise of private jet charters that will eat into the business travel segment of commercial airlines. “The ‘Uber of the skies’ will be a real trend offering the opportunity for people who had never had the opportunity to get on a private plane to charter their travel with an App. You are looking at a whole new market that is going to impact commercial airlines, which will likely lose market share in the lucrative first/business class passenger segment. In addition, private companies are increasingly going to look at business travel for essential or unavoidable purposes only.”
Linus Bauer reiterated the need to build confidence in the industry’s ability to “carry passengers from A to B safely.” He said the decline in business travel was a key challenge, while adding that the opportunities in the Middle East were tremendous, leading to increased appetite for aviation services.
Peter Morris said the success of the industry calls for commercial solutions. “Only business models that meet the needs of customers will be successful. You cannot force people to travel and there are different sets of parameters for business and leisure.” Top priorities include ensuring the continued viability of airlines, airports and tourism providers, he added. “A coherent response by governments is lacking and air travel patterns remain complex. The hit to global GDP is another factor that influences the ability to travel.”
The eighth Arab Aviation Summit is organised by Air Arabia and hosted in collaboration with the Ras Al Khaimah Tourism Development Authority (RAKTDA). The event is held under the theme, ‘Arab Aviation in the New Normal.’