| Aviation: PACIFIC AIRLINES LAG BEHIND IN GLOBAL SAFETY |
Drysdale: There’s a lot of catching up to do
Samisoni Pareti
Airlines of the Pacific are lagging behind global initiatives aimed at improving air safety and reducing operational costs, says outgoing International Air Transport Association (IATA) regional vice president Asia/Pacific, Andrew Drysdale.
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Andrew Drysdale... a lot needs to be done in the Pacific.
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Figures he tabled at the December conference of the Association of South Pacific Airlines (ASPA) at the Sofitel Resort in Nadi confirmed that airlines in the region had a lot of catching up to do on converting to electronic ticketing and completing IOSA, the IATA’s International Operational Safety Audit.
By the end of September 2006, about 70% of IATA members worldwide had adopted e-ticketing. For the same period in 2005, only 40% of IATA members in the Asia/Pacific region had adopted the new ticketing system.
“In 2004, the IATA board of governors and its 260 airline members tasked IATA to lead its ‘simplifying the business’ initiatives, which will save the industry US$6.5 billion,” said Drysdale.
“The top priority project is 100% e-ticketing by end of 2007, which will save US$3 billion.
“We achieved our target of 70% ET (electronic ticketing) penetration in November 2006—one month ahead of schedule.
“The ET penetration for Fiji as at November 2006 was 25%.
“While it is an industry decision to move to 100% ET, individual airlines have the option of not converting to ET.
“This will be a business decision to be made by the airline.
“However, after December 2007, IATA will stop distributing paper tickets.
“Carriers that are not ET enabled will have to produce and distribute their own tickets at a very high cost.
“Also, such carriers will not be able to interline with carriers using ET.”
Airlines in the region need a lot of catching up too with regard to IOSA. Apart from QANTAS, Air New Zealand and Pacific Blue, only Air Tahiti Nui has completed this IATA-sanctioned audit by January 2007.
Said Drysdale: “All IATA members will have to complete an IOSA audit by the end of 2007 and be on the registry by the end of 2008 in order to retain their membership of IATA.”
Already one ASPA member, Polynesian Airlines, has announced its inability to be part of IOSA due to financial constraints. This Samoan Government airline has thus forfeited its IATA membership.
“This audit is what national civil aviation authorities usually do for airlines,” explained George Faktaufon, ASPA’s secretary-general.
“They audit flight operations, engineering systems, manuals, training, all these are covered and IATA has developed audit guidelines as to how you go through this audit.
“In fact the IATA audit is much more stringent than civil aviation audits and the whole idea is that IATA is taking a more proactive step to ensure that safety is a priority for airlines.
“In other words, don’t wait for the authorities to come and tell you what you should be doing. You make sure that you do what you should be doing so that the authorities don’t have anything to point at you.”
With the December 2007 deadline, Faktaufon said the challenge has been compounded by the fact that IOSA can only be done by eight accredited companies worldwide. Cost of such audits is borne by each airline and according to ASPA, one single audit costs up to US$60,000.
Dysdale didn’t deny such IATA initiatives do come at a cost to its members. But he said the international body had also been lending a hand, especially to its smaller members in the Pacific, in order to cope with the changes.
“In 1984, IATA established the International Airline Training Fund (IATF) as a central component of its programme for developing nations’ airlines.
“IATF fosters training as a means to sustainably enhance the knowledge and skills of employees of IATA member airlines in developing countries, thus allowing them to meet their business needs and challenges of the air transport industry.
“IATF also serves as a key platform for supporting IATA member airlines in developing countries to meet industry priorities by facilitating access to training, information and other services within IATA.
“In fact, the Pacific Islands have benefitted, and continue to benefit from IATF.
“Besides the IATF, IATA has also provided some services to member airlines without any costs, such as having our experts visit the airlines in the Pacific Islands to provide advice and training on e-ticketing and organising an IOSA workshop for Pacific Islands airlines in Fiji last year.”
Drysdale said IATA’s goal is ensuring that no member is left behind. It is for this reason that similar assistance has been offered on ET compliance.
“We are pulling out all the stops to make sure airlines are ready. We are investing US$2 million in an ET buddy programme. We have held ET workshops across the region to build skills.
“But ultimately it is up to each carrier to treat this with the urgency it demands.
“The biggest loss to carriers (who don’t use ET) would be that they will not be able to interline with carriers that are using e-ticket.
“This would translate into an opportunity cost in terms of potential passengers.
“These carriers would also not be able to benefit from the savings derived from e-ticketing—it costs US$10 to process a paper ticket, while it costs US$1 to process an e-ticket.”
Drysdale, who in May will finish his term as IATA regional vice-president, said the world body has also done a lot of work in cushioning rising jet fuel costs. Pacific airlines, he said, had benefitted from this initiative as well.
“The industry fuel bill in 2006 was US$112 billion, or 26% of operating costs.
“This is more than double the fuel bill of US$44 billion in 2003, when fuel was 12% of operating costs. This year, the fuel bill is expected to reach US$120 billion.
“As part of our fuel savings campaign, IATA works with governments, airports and air navigation service providers on operational improvements through new air routes, route improvements and more efficient airport arrival and departure procedures for aircraft.
“The main purpose of the operational improvements is to shorten routes.
“Every minute of flight burns US$120 of fuel.
“An example of a route improvement is the opening of IATA-1 in China, which reduces the flight time between Europe and China by 30 minutes.
“Improved arrival and departure procedures for aircraft at Singapore’s airport have also led to US$30 million savings.
“Our fuel savings campaign also includes sharing of industry best practices on how airlines can consume less fuel.
“In 2004, IATA published a book which shares industry best practices on how to reduce fuel consumption.
“This includes washing the aircraft more frequently to reduce friction, or using lighter catering equipment on board the aircraft.
“We also introduced “Go Teams. The Go Teams will visit airlines on request to perform fuel assessments and identify how they could reduce fuel consumption.
“A total of US$1.8 billion in savings were achieved in our fuel campaign in 2006.
“Besides our fuel campaign, IATA has also formed a taskforce that works closely with the relevant industry bodies to explore alternative fuels.”
Of the future, IATA believes much can be done on streamlining air freight. And if there is electronic ticketing, there can also be electronic freight, E-freight for short.
“E-freight aims to free the airfreight supply chain of the need to transport paper documents in parallel with the freight by moving to a simpler, paper free, electronic environment.
“IATA e-freight involves: airlines, shippers, freight forwarders, ground handlers, and customs administrations. E-freight seeks to free air cargo of paper where feasible by the end of 2010.
“Today every cargo shipment travels with up to 38 documents at a cost of US$30.
“On top of that, in 33 years we have only reduced shipment times by 12 hours.
“E-freight requires a number of basic criteria to operate.
“There is a need for a legal framework or legislation that permits the customs administration, government and trade to work in electronic customs and e-commerce environments.
“There must be procedures, systems and a business framework in place to support this. And countries must have compatible international treaties—either Montreal Protocol 4 (MP4) and Montreal Convention of 1999 (MC99)—on e-freight trade lanes.
“The Pacific Islands are not yet ready for e-freight. To be part of e-freight, the Pacific Islands must take the important step of signing both the Montreal Protocol 4 and the Montreal Convention of 1999, in addition to making significant progress on the other e-freight qualification criteria.
“A lot of work also needs to be done by the customs authorities and government. The government has to work on providing the impetus for exporters to reduce paperwork while customs needs to change existing processes. And all stakeholders have to agree and take action to be prepared—including airlines, freight forwarders, shippers, customs and government.”
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