Aviation leaders from around the world have been in the South Korean capital for the International Air Transport Association (IATA) 75th Annual General Meeting (AGM) and World Air Transport Summit (WATS). Many have extended their stay to also attend the event at the Intercontinental Seoul COEX hotel in Seoul's upscale Gangnam-gu district.
The Blue Swan Daily and CAPA - Centre for Aviation teams have already caught up with many of the delegates over the past couple of days at the COEX Convention Centre and Exhibition Hall during the IATA AGM.
- READ latest news and insights from Seoul with CAPA's respected news briefs (members only)
- FOLLOW developments on social media via CAPA and The Blue Swan Daily and join the debate on the official #CAPASummit channel.
Tuesday 04-Jun-2019
15:50 - CAPA Airline CEOs in Seoul Summit & Gala Dinner … DONE!
We hope you enjoyed all the insightful discussions whether in attendance in South Korea, via our live stream or from following the blog. The event will run for a third edition this time next year alongside the IATA AGM in Amsterdam, Netherlands. Look out for our post-event coverage and the publication of our exclusive CAPA TV video interviews.
Tuesday 04-Jun-2019
15:40 - A big thanks to our event partners
A big thank you from all of the CAPA - Centre for Aviation team to everyone who attend the CAPA Airline CEOs in Seoul Summit & Gala Dinner at the Intercontinental Seoul COEX, as well as all the sponsors and event partners that made it possible.
Tuesday 04-Jun-2019
14:45 - Up now... Open Forum - The future of airline distribution, NDC and beyond
Legacy distribution systems have for decades presented airlines with the twin problems of high costs and product commoditisation. In efforts to address these issues, carriers throughout the world have invested heavily into establishing their own API channels with agents, while the concurrent push by IATA for airlines to implement the NDC standard has encouraged the industry to adopt a retail focused approach to distribution.
In this Open Forum, industry experts are addressing all sides of the distribution model, to assess the NDC strategy, what it means for their section of the aviation ecosystem, and how the environment is changing. These include representatives of GDSs, OTAs, Travel Management Companies and Corporate Travel Buyers, as well as representatives from IATA and airline members.
Audience participants are also interacting with the experts in a wide-ranging discussion covering:
- How different participants are being and will be affected by the evolution
- Where they are in delivering the strategy;
- What they would change in the strategy if they could;
- What is the desired end point;
- What are the complexities of the strategy;
- What impact will this have on their bottom line
Tuesday 04-Jun-2019
14:30 - Industry insights - the Spring Airlines viewpoint
Spring Airlines chairman Stephen Wang says that 90% of the carrier's bookings are from online and mobile channels. The remaining 10% of bookings are from travel agents. The travel agent bookings are all direct with Spring. Mr Wang said it is the only Chinese airline not using TravelSky. He saysChina's international market has "huge potential for the future". Mr Wang pointed out that only 10% of Chinese citizens now have passports but the number of international travellers continue to increase rapidly. About one third of Spring's traffic is now international. While there are huge growth opportunity for Spring to grow in the international market Mr Wang pointed out there are infrastructure challenges.
Tuesday 04-Jun-2019
14:00 - Up now....Innovation Panel
Tuesday 04-Jun-2019
13:30 - Industry insights - the airBaltic viewpoint
airBaltic CEO Martin Gauss says the Airbus A220 "is a game changer compared to other narrowbodies in the market because everything is new there". Mr Gauss pointed out the A220, which was initially developed by Bombardier and known as the CSeries, is a "complete new development from scratch" while the 737 MAX and A320neo do not have totally new technology. airBaltic has been pleased with the A220's performance and Mr Gauss expects further performance improvements as the engine matures. He said the airline does not need the extra range on the A220 that was recently announced by Airbus. "We don't need any more (range) as seven hours is already very long with that aircraft," Mr Gauss said. As CAPA previously reported, Airbus is increasing the range of both the A220-100 and A220-300 by about 450nm to 3,400nm and 3,350nm respectively. airBaltic operates 19 A220-300s and has another 31 on order, according to the CAPA Fleet Database.
Tuesday 04-Jun-2019
12:55 - It's time for lunch, but there's a bumper session still to follow
Now is the time that most CAPA conferences come to an end with lunch on the second day. But, here in Seoul we still have two exciting sessions to follow, an innovation panel with IATA and Emirates Airline, and then an open forum looking at the future of airline distribution, NDC and beyond. The latter is a special interactive session open to all sectors of the industry aims to provide a greater understanding of the intricacies of how the NDC proposition is progressing and how different sectors and airlines are being affected.
Tuesday 04-Jun-2019
12:30 - Up now... The future of distribution - How airlines can become retailers through smart technology
Tuesday 04-Jun-2019
12:15 - 'Boeing will have to undertake a lot of effort to reinstate the 737 MAX's credibility'
"Boeing will have to undertake a lot of effort to reinstate the 737 MAX's credibility in the market," acknowledges Rafał Milczarski, CEO, LOT Polish Airlines, but he has no plans to cancel the carrier's commitment. There has been a lot of talk over the past few weeks about airlines potentially cancelling orders for the new generation airliner. These would be "emotional rather than rational decision," says Mr Milczarski. "I prefer to choose rational decisions." He said the two accidents are tragic "but I'm sure the aircraft will be safe in the future. I think it's our obligation - and I'm sure Boeing will play its part in that - to ensure the public the aircraft is safe to fly."
According to Mr Milczarski, "until the grounding was an amazing performer" for LOT. He said the MAX 8 was generating 20% fuel savings compared to the aircraft it had been using on routes previously and a reduced noise footprint."I'm confident the aircraft will come back into service and when it comes back it will be the safest in the world and will continue to be an amazing performer," Mr Milczarski said. LOT has five grounded 737 MAX 8s and has commitments for at least another seven, according to the CAPA Fleet Database.
Tuesday 04-Jun-2019
12:00 - Up now... State of the aircraft market: fleet orders and deliveries outlook
In an industry with so many variables, any assessment of the future, even looking only a year ahead, is riven with challenge. But there are some indicators that predict outcomes more accurately than others.
One of the more reliable pointers is aircraft orders. These suggest capacity (supply side) conditions in the year to come. Admittedly delivery dates can alter or orders be changed or cancelled. It's also important to recognise the level of replacement vs net fleet additions. But even with these cautions, the sheer contrasts in scale of orders and deliveries speaks volumes.
Where the Asia Pacific operating fleets are rapidly approaching North America's dimensions, the fact that the region has no less than twice the number of deliveries planned for 2019 speaks volumes - both for global aviation and for capacity levels in AsiaPac. The net effect contrast is even greater in practice, as North America's often much older fleets imply a higher concentration of replacements.
Tuesday 04-Jun-2019
11:45 - Why airlines need to operate like tech companies
Sebastian Mikosz, group managing director and CEO of Kenya Airways, says airlines "need to operate like tech companies" in his keynote address. He explains that "we are a smarter society today thanks to technology innovation" and the top ten largest companies in the world by market value are tech companies and banks, not airlines or travel companies. But would technology companies exist without airlines? "Technology companies need airlines since we own the metal," says Mr Mikosz. So, what should airline do? The answer is simple, according to the Kenya Airways' boss. "Think like digital retailers," he says. "If we do not adopt the OTA business model, we will become the sub-divisions of technology companies."
Tuesday 04-Jun-2019
11:30 - Up now... Airline Keynote - Kenya Airways
Tuesday 04-Jun-2019
11:00 - Industry insights - the China Southern viewpoint
China Southern SVP international and corporate relations Guoxiang Wu shares some industry insights.
He explained that China Southern is pushing TravelSky to change. Almost 60% of China Southern's bookings are generated via TavelSky, which is the main distribution player in China's domestic market. Mr Wu said China Southern is trying to reduce its distribution costs as well as billing segment cost.
He said the China-Europe market will continue to grow rapidly. But he highlighted traffic rights and infrastructure as challenges. "Nearly all the major airports in European countries are congested," Mr Wu said. He added that if "skies are open" and infrastructure constraints are resolved Chinese airlines will be keen to add more to Europe.
He stated that airport slots and traffic rights are challenges as Chinese airlines seek to grow in the international market. "Market demand is increasing very quickly," Mr Wu said. "We must match the demand. We need more freedom to have more traffic right to fly when we want." He added that: "I think the full service airlines and the low cost airlines can share the same lunch."
Tuesday 04-Jun-2019
10:30 - Industry insights - the SpiceJet viewpoint
SpiceJet chief customer service officer Kamal Hingorani provides some insights into the current state of the Indian aviation sector.
He said that almost 50% of Jet Airways' domestic capacity has been absorbed by other airlines. "Spicejet has taken over the biggest chunk," Mr Hingorani said. He pointed out that SpiceJet has added over 30 aircraft in last 30 days, which has resulted in adding almost 50% to its pre-existing capacity.
He highlighted that India's new government has a "huge reform agenda" that includes civil aviation. Mr Hingorani said developing international hubs is part of the agenda which should allow Indian airlines to increase their share of the international market. Foreign airlines now dominate India's international market with most international passengers travelling via overseas hubs such Singapore, Bangkok and Dubai, which Mr Hingorani referred to as "a shame". He added the new government "are absolutely committed that India becomes a global hub".
He revealed the airline plans to sign "many more" codeshares and marketing alliances. As CAPA previously reported, SpiceJet signed a codeshare partnership with Emirates in Apr-2019. Mr Hingorani said to begin with SpiceJet's codeshares will be sold via the GDS. In the local market SpiceJet continues with the policy it introduced 14 years ago, when it decided against using GDS and introduced a direct booking system with Indian travel agents.
He added annual passenger growth from Indian second tier and third tier cities is 18% while growth at the main metros is 5% to 6%. The growth in smaller cities has increased the need for the development of new hubs. Traditionally Delhi and Mumbai have been the only hub airports but Mr Hingorani pointed out that Hyderabad and Bangalore are now being expanded to cater to hubbing as well as domestic and international growth. Indian LCCs initially focused on domestic travel but are starting to focus more on the international market and network traffic. "There's a need to enhance the international networks," Mr Hingorani said.
Tuesday 04-Jun-2019
10:00 - Up now... Looking to Asia for inspiration and growth
Asia is the fastest expanding and most innovative market in the world, it has enjoyed spectacular growth over the past several years and while China has clearly led the way, South Korea and Taiwan have also grown rapidly, and even Japan has had a resurgence in the past few years.
LCCs have finally started to penetrate the North Asian market, helping to drive the rapid growth as lower fares have stimulated demand. LCC capacity in North Asia particularly has increased tenfold over the past 10 years, albeit on a small base, and has nearly doubled in just three years. This represents an LCC penetration rate of less than 20%, indicating that there is still plenty of opportunity for further LCC growth. LCCs are planning more rapid expansion in 2019 but the region's FSCs are also growing, particularly in China.
- What is Asia doing to meet this increasing demand?
- Is this level of growth sustainable?
- How is the travel industry reacting to this growth?
Tuesday 04-Jun-2019
09:45 - Up now... What is coming from Asia? Is China going to eat our lunch?
Ahead of the first panel session, Hugh Aitken, senior director of strategic partnerships at Skyscanner, lights the mood with a short presentation on how the industry is closely watching what is coming from the east. "Eastern brands are coming into the west," he says. "Western brands are followers in technology. They take inspiration from them."
Tuesday 04-Jun-2019
09:30 - New ownership is helping Travelport's journey
Gordon Wilson, CEO & President of Travelport says its new owners are helping it achieve its development goals. "It is not changing our strategy, it is accelerating what we are doing," he says.
It is a very different landscape for the GDS providers today with NDC. "We were never against NDC, connecting to APIs is what we have done since we have founded. The nature of them has just been changing," says Mr Wilson.
Many have questioned if travel management companies and travel agents are understanding the changes to the industry. "There has been a lot of misinformation. People tend to deal with reality and not hype. It is reality now so things are improving as time moves on," says Mr Wilson.
"There is certainly going to be further traction with NDC in 2019," says Mr Wilson. "I think there will be a ramp up in 2020. How long until everyone is speaking the same language? I would say five years, at least."
Tuesday 04-Jun-2019
09:15 - Up now... Fireside Chat with Travelport's CEO and President Gordon Watson
Tuesday 04-Jun-2019
08:30 - PHOTOS from last night's Gala Dinner
Last night's Gala Dinner provided attendees with some enlightening insights into the lives and ambitions of some of the industry's leading executives. While we can't share the content of a fun evening, we can share some photographs.
Tuesday 04-Jun-2019
08:00 - 안녕하십니까! (Good morning!, Cheer!) from Seoul
It's just an hour before we kick -off on day two of the CAPA Airline CEOs in Seoul Summit & Gala Dinner. Its been a busy couple of days with the IATA AGM and yesterday's Twilight session of the conference. There's a lot more exciting content in store today.
Tuesday 04-Jun-2019
07:00 - Welcome to day two at the CAPA Airline CEOs in Seoul Summit & Gala Dinner
It's an early start and the agenda doesn't kick off for a couple of hours but the CAPA team are on site to make sure everything is ready on what is sure to be another interesting day of discussions.
Monday 03-Jun-2019
23:00 - Once upon a time in Seoul… A lot of fun at CAPA dinner!
The laughter rocked around the Intercontinental CORX this evening as the CAPA Airline CEOs in Seoul CEO Roundtable Dinner took place. Richard Quest may have been absent, but CAPA's own Peter Harbison poised some questions to a top table panel consisting of Martin Gauss, CEO and Chairman of the Board, airBaltic; Steven Udvar-Hazy, Executive Chairman, Air Lease Corporation; John Slattery, President and Chief Executive Officer Commercial Aviation, Embraer; Christine Ourmières-Widener, CEO, Flybe; Kresimir Kucko. CEO, Gulf Air; Sebastian Mikosz, Group Managing Director and CEO, Kenya Airways; Rafał Milczarski, CEO, LOT Polish Airlines; Christina Cassotis, CEO, Allegheny County Airport Authority; Jeffrey Goh, CEO, Star Alliance; and Gordon Wilson, CEO & President, Travelport. The discussion was enlightening and humorous in equal measure. A fly on the wall could tell so many stories. Unfortunately for you all, what happens at a CAPA dinner stays at a CAPA dinner.
Monday 03-Jun-2019
19:00 - From industry debate... to drinks
Comments from Steve Udvar-Hazy that "we are public enemy number one and an easy industry to pick on," is the perfect time to stop the discussions after a long day for most of us in Seoul. After a well received panel session it's time for our drinks reception ahead of tonight's roundtable dinner.
Unfortunately, last year's host, CNN Anchor Richard Quest, was unavailable tonight - perhaps those on the top table will give a huge sigh of relief! But, there's still a high level of industry professionals preparing themselves for what is generally a light-hearted and humorous discussion. Who knows what is in store… unfortunately all you blog readers will not get to find out as this is a closed session so we cannot provide any updates on the blog.
Monday 03-Jun-2019
18:40 - Low-Cost Long-Haul is an 'interesting dilemma'
Air Lease Corporation boss Steve Udvar-Hazy describes the low-cost long-haul model as an "interesting dilemma," "It's a tough business," he says where "seat densification is main driver to get costs down." However, he adds: "There are enough markets with traffic density where you can have some smart players."
Monday 03-Jun-2019
18:30 - Personalisation 'is coming, but its still got a long way to go'
Travelport's CEO and President Gordon Wilson says "airlines have come a long way in understanding the customer profile," but acknowledges that make the move to a full retail-centric outlook can be difficult. They are working well with the customer experience, bit other areas in personalisation are "still in their infancy," he says. "It's coming, but its still got a long way to go," he adds.
Monday 03-Jun-2019
18:20 - Lessors are not to blame for any capacity oversupply
[perfectpullquote align="full" bordertop="false" cite="" link="" color="" class="" size=""]"There's always periods of oversupply and undersupply, but the market generally finds the equilibrium. It is the market that dictates demand. It is something they react to or stimulate and the leasing companies then come in and provide the capital and right solutions to the airlines."
Steve Udvar-Hazy, Air Lease Corporation[/perfectpullquote]
Monday 03-Jun-2019
18:05 - Up Now... Twilight Session: Finding a way through stormy waters
As fuel prices deliver short term relief, demand is the big unknown. It's become almost a truism since the advent of President Trump, the British folly of an imminent Brexit, the rise of European populist politics, and rising debt challenges, to say that the coming year will be characterised by unpredictability.
Outlook discussion points:
- Low fuel prices offer a period of relief
- Demand: growth remains solid but may be slowing
- Recession is merely a matter of "when", not "if"
- High growth in 2017 and 2018 has created a more price sensitive consumer profile
- Asia Pacific aircraft orders suggest oversupply in 2019
- Increasing pre-eminence of LCCs in Asia
- The rise and rise of long haul low cost - narrowbody
- The system for selling tickets is about to be savagely disrupted
- The arrival of NDC and where it is leading
Monday 03-Jun-2019
18:00 - Join the debate - via #CAPASummit
https://twitter.com/MajaGedosev/status/1135471545437081600
Monday 03-Jun-2019
17:55 - 'It is very easy to collect taxes from the airline industry'
Christine Ourmières-Widener, CEO, Flybe says airlines are hit hard by taxes. "It is very easy to collect taxes from the airline industry," she says. For the UK regional airline it is a particularly big issue due to its large domestic network. "We are taxed two times on all these flights," she explains.
Monday 03-Jun-2019
17:45 - Join the debate - via #CAPASummit
https://twitter.com/HofmannAviation/status/1135458274768183296
https://twitter.com/Travelport/status/1135444348168916992
Monday 03-Jun-2019
17:40 - 'Behaviours will change if we have more diversity'
Christine Ourmières-Widener was rewarded earlier today by IATA for being an inspirational role model for women in aviation. She has been the sole woman on the IATA's Governing Board for the past year. "It's a boys business. A big boys club," she says, but believes that is a result of its nature. "Behaviours will change if we have more diversity," she says.
Monday 03-Jun-2019
17:30 - Mrs Ourmières -Widener's journey from engineer to CEO
Christine Ourmières -Widener began her career in aviation as a young engineer in maintenance department. From there she has worked her way up through various high-profile roles on multiple continents, leading her to the role of the CEO of Flybe.
One of her main areas of focus includes raising the profile of aviation among young people and inspiring young women to join the aviation industry. Christine's mantra is that "young women cannot be what they cannot see" which is why she uses her position as a CEO of an airline to champion women in aviation at every opportunity, becoming a true role model for young and ambitious women.
She introduced the highly successful FlyShe initiative which is designed to change aspirations and create opportunities for women. The FlyShe programme has received coverage both in the UK and abroad and continues to be recognised as a way to address the future skills shortage in aviation.
Monday 03-Jun-2019
17:25 - Up Now... Fireside Chat with Christine Ourmières-Widener, CEO, Flybe
Monday 03-Jun-2019
17:20 - What's in a name? A lot when it comes to airports and cities
[perfectpullquote align="full" bordertop="false" cite="" link="" color="" class="" size=""]"I'm not sure how far away from the city you can still classify it as such, I think Ryanair may have some statistics on that."
Paul Griffiths, CEO, Dubai Airports[/perfectpullquote]
Monday 03-Jun-2019
17:15 - In terms of innovation, a lot 'stops at the PR stage'
Paul Griffiths is not sold on autonomous personal flying machines "A lot of the innovation stops at the PR stage," he says. "That technology need to be proven by a proper certification process before it is fit for passenger consumption." He adds: "I'm not sure how comfortable people will be with a huge propeller above their heads powered by a Lithium battery. However, he feels "we will get there with driverless cards".
Monday 03-Jun-2019
17:10 - There will be shift from air to ground based service on short-haul
The Dubai Airports CEO, Paul Griffiths says "air travel is clearly, by its speed, very relevant for long distance travel," but he believes there could be a travel duration based move to other forms of transport, and sees potential for "a lot of migration on short-haul travel from air based service to some form of ground-based service". He believes the industry's biggest issue is currently the "cumbersome legacy interface between forms of transport".
Monday 03-Jun-2019
17:00 - Up Now... Fireside Chat with Paul Griffiths, Dubai Airports
16:55 -'Start Me Up' and away we go!
CAPA - Centre for Aviation executive chairman Peter Harbison takes to the stage to welcome delegates to the CAPA CEOs in Seoul Summit & Gala Dinner in front of a packed audience.
Monday 03-Jun-2019
16:45 - The countdown commences
It is just ten minutes until the opening of this year's CAPA- Centre for Aviation Airline CEOs in Seoul Summit & Gala Dinner. Prepare to hear The Rolling Stones as CAPA executive chairman takes to the stage to welcome attendees.
600 seconds… 599 seconds… 598 seconds….
Monday 03-Jun-2019
16:15 - The stage is set ... we are almost ready to welcome delegates!
Monday 03-Jun-2019
16:00 - Delegates are starting to arrive at the CAPA Airline CEOs in Seoul Summit & Gala Dinner
Delegates are starting to congregate at the Intercontinental COEX hotel ahead of the second running on this event following its successful debut in Sydney last year. CAPA TV is already adding to its collection of exclusive insights.
Monday 03-Jun-2019
15:00 - A charitable message - Airlink establishes new Governors Council
Airlink President and CEO Steven Smith confirmed to The Blue Swan Daily on the sidelines of the IATA AGM that it has established a new Governors Council to support its mission of mobilising the aviation industry to ensure assistance reaches communities impacted by disasters and other humanitarian crises. The non-profit organisation has welcomed many influential senior aviation executives to the Council, which will be led by industry veteran Peter Davies, founder of Airline Management Group and chief restructuring officer for South African Airways. The Council includes representatives of GE Capital Aviation Services, Rolls-Royce, American Airlines, Brussels Airlines, Atlas Air Worldwide, JetBlue Airways, Copa Airlines, Hawaiian Airlines, United Airlines, Embraer, Alaska Air Group and Fiji Airways. They have committed to "advancing Airlink and the life-saving role aviation plays in humanitarian relief."
Since its inception in 2010, Airlink has worked with its airline partners to respond to a number of rapid-onset disasters. You can learn more in the video below.
Monday 03-Jun-2019
14:30 - CAPA launches The Corporate Travel Community (CTC)
CAPA has announced the launch of a vital new organisation for the corporate travel industry: The Corporate Travel Community (CTC). Headed by Dr Benson Tang, the CTC will convene "CTC Gatherings" (conference and expos) at Asia's major cities, along with regular training events, workshops and social events, to support and advance the role of the corporate travel manager.
https://corporatetravelcommunity.com/new-corporate-travel-community-takes-off-in-asia/
Monday 03-Jun-2019
14:15 - IATA AGM Discussion Points - pilot shortages
IATA Director General Alexandre de Juniac suggested that industry concerns on a lack of future pilots is more of a training issue than a numbers issue. "We don't have a recruitment problem. I am not worried," he said, but acknowledged that there are "issues" with training. "We are working on it, we must design our training to meet it."
Monday 03-Jun-2019
14:00 - IATA AGM Discussion Points - airport privatisation
IATA Director General Alexandre de Juniac stated that privatisation is "not the only and magic solution" for airport privatisation. He explained that IATA is "not in favour or against," but that there are "multiple solutions" and governments should "explore them all before rushing into a decision". "There is no magic in privatisation," he added.
Monday 03-Jun-2019
13:45 - IATA AGM Discussion Points - gender equality
IATA Director General Alexandre de Juniac stated women are not equally advancing into senior management in the airline sector and that is an important hurdle that must be overcome. "We now have two board members, it is too little, I will admit," he said. Me de Juniac stated that this is a long-term issue. "We will have to work over the next five years to improve the position of women within the top jobs at airlines. We are working on it and if we do the job properly ten years from now the situation will be different," he added.
Monday 03-Jun-2019
13:30 - READ our lead story from the IATA AGM
https://corporatetravelcommunity.com/slowing-demand-and-rising-costs-are-putting-a-squeeze-on-airline-profits/
Monday 03-Jun-2019
13:00 - As the IATA AGM concludes... CAPA CEOs in Seoul prepares for take-off
It's hardly a secret that the airline industry is facing myriad challenges, notably in the marketing and distribution areas, as companies with personalised data, and the analytics and artificial intelligence to go with it, become greater threats to the stability of the traditional airline model. The CAPA CEOs in Seoul forum will kick off in just a couple of hours with an amazing line-up of airline leaders joining our evening debate and dinner.
