Simplifying the Business: from e-ticketing to a 2020 vision. To represent, lead and serve the airline industry
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1 Simplifying the Business: from e-ticketing to a 2020 vision To represent, lead and serve the airline industry
2 What will air transport look like in 100 years?
3 Our goal: a profitable industry Return on invested capital in the airline industry vs the cost of capital Forecast % of invested capital Cost of capital (WACC) 2.0 Return on capital (ROIC) F 2011F 2012F 2013F 2014F 2015F 3 Source: IATA
4 Our challenge: value in the supply chain Average ROIC (%) Average ROIC (LHS) Volatility in ROIC (RHS) Upturn ROIC divided by Downturn ROIC CRS Lessors Freight Forwarders Groundhandling Manufacturers 4 Fuelling Travel Agents Catering Maintenance Airports Airlines Source: IATA
5 One answer: Simplifying the Business Annual industry savings E-ticketing CUSS kiosks US$ 3bn US$ 1bn 2D BC Boarding Passes US$ 1.5bn Baggage Improvement Fast Travel E-services US$ 1.9bn US$ 1.6bn US$ 2.9bn ABR US$ 0.8bn
6 StB Targets BCBP 100% BCBP IATA e-freight Implement e-freight at a total of 44 locations and 76 major airports A total of 20 electronic messaging standards Baggage Improvement Program (BIP) Conduct 15 diagnosis sessions at airports Launch the self-help program with 20 airlines Fast Travel 60 new implementations (114 total); five in each project area IATA e-services By 2010, capability in all Global Distribution Systems and 10 airlines By 2012, 100% industry capability By 2013, 100% usage in IATA BSPs Simplifying the Business 6 International Air Transport Association 2009
7 Self Service Trend*: What do passengers want? 70% of passengers would tag their own bags if they could 74% of respondents are interested in printing bag tags remotely 70% of respondents would use automatic boarding gates Two thirds (66%) of respondents would use a baggage claim kiosk, an increase from last year s 48% *: Source: SITA-Passenger Self-Service Survey 2010 Simplifying the Business 7 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
8 Fast Travel: Self-Service Suite Simplifying the Business 8 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
9 The passenger journey defined Departure 01 Pre-travel 02 Ticket Issuance 03 Check-in 04 Document Scanning 05 Authorisation to proceed 06 Baggage processing 07 Immigration exit control Document Check Flight Arrival 08 Security access 09 Security screening 10 Flight rebooking 11 Boarding 12 Immigration entry control 13 Baggage collection 14 Customs Transfer Simplifying the Business 9 International Air Transport Association 2009
10 Bundling & Unbundling Full Airline Fare Inbound Fare Outbound Fare Comfort kit Xtra Bag Meal Sky Bus Ancillary services represent up to 23% of LCC revenues US Airline Industry Total 2009 Ancillary Fee Revenue = $7.8 B Source: US DOT Form 41, table 1A Simplifying the Business 10 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
11 Industry trends & StB projects Passenger Process Revenue Generation Regulatory Process Self Tagging Document verification IRROPS recovery Lost and Found Security & Immigration Selling ancillary services Upgrades Excess baggage Lounge Access Meals. Self Service Data Capturing device Self Service Immigration Access to security Simplifying the Business 11 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
12 The Vision of Simplifying the Business Our mission is to change the way the industry operates by improving service and lowering costs Today, that mission is now more relevant than ever And we re intensifying efforts to deliver the change the industry needs Simplifying the Business 12 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
13 Transforming the airline industry Airline Planning Airline Distribution Passenger Experience Baggage Services Scheduling Ticketing Reservations Coding Taxes Mileage Tariffs Prorate Messaging Boarding Pass Check-in Kiosks Baggage Drop Facilitation Immigration Boarding Gate Bag tag Baggage process improvement Loading / unloading Sortation Security Messaging 13
14 Industry solutions for air transport Airlines, Airports, Governments, SPs Regions, Countries Vision 2050 Symposium Steering Group Stakeholders Standards JPSC ET, EMD, CUSS, Bag tag, XML Projects Simplifying the Business: ABR, BCBP, BIP, E- services, Fast Travel Products & Services Coding, MITA, Mileage, PAT, Tax Passenger Vision: pleasant, cost-effective air travel journey Mission: transform the air travel value chain 14
15 For more information, visit the IATA website Simplifying the Business 15 INTERNATIONAL AIR TRANSPORT ASSOCIATION 2010
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