By: Sir Michael Bishop |
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© Rex Features |
Congratulations to Airline Business for 25 years of excellent and specialised coverage of the world airline industry.
The business of air transport is a tumultuous industry, whose financial fortunes are frequently dictated by economic, aeropolitical, criminal or geological events far beyond the day-to-day operation or control of an airline's management itself.
Liberalisation and deregulation have been progressive and, latterly, greatly accelerated features of the consistent growth of airlines since the 1970s into new markets, making air travel affordable to a much wider income group. In the past 15 years, the budget-airline model has created start-up airlines that have rapidly grown to match or exceed the number of passengers carried annually by many of the longest established and larger full-service carriers.
Whether this scale of development will continue during the next 25 years is an interesting issue for the industry. On the one hand, the forecasts for economic growth and dependency on air travel, especially in Asia, are likely to be achieved. Other factors, however, may restrain the pace of further deregulation and liberalisation.
There are concerning signs in the greater world economy of moves towards protectionism, currencies being more overtly used in economic trade wars, and an unwillingness among many countries to enable competition for full-service carriers through international air-service agreements and the acceptance of open skies. The developing trend of allowing monopoly or duopoly full-service international airlines to establish their own subsidiary budget airline models will lead to a diluting of the business model that has been so successful in Europe and bring on the emergence of 'high-cost' budget carriers.
IMPROVING SECURITY
Alongside the economic issues, others loom just as large. There can be no prospect of an immediate solution to the terrorist threat. We can only hope that significant improvements in profiling and equipment will eliminate the necessity for the expensive, intrusive and time-consuming processing so frequently highlighted by passengers as a reason why they would prefer not to fly.
Unexpectedly, in the past four years, the two major airframe manufacturers have experienced real difficulties in producing on schedule two quite different types of new aircraft, one of very large but conventional design and the other with new technology. Airline customers of these aircraft have been dismayed by delayed deliveries that have not been seen in the industry since the very early days of jet aircraft manufacturing in the 1960s and 1970s.
While delayed delivery means equal delay in payment - which is perhaps not too inconvenient to customers in the current economic climate - concern can only increase in the years immediately ahead. Especially if, as hoped, the current revival in air travel is sustained.
Equally important for the next 25 years is the need for new-generation short-haul aircraft in the 120-200 seat range to be designed and built in new materials, replacing conventionally designed aircraft whose origins can be traced back 40 years. The new generation of short-haul aircraft will need to give operators a significant reduction in operating costs.
The next 25 years may also see a reduction in the domination of the two present major manufacturers through the expansion of current smaller manufacturers. It is also entirely possible that there will be competition from completely new and well-financed companies in Asia or elsewhere.
The demonisation of the airline industry by some governments and by special-interest climate change/global warming groups must be reined in and a more rational approach adopted towards an industry that has been and will remain one of the key supports of global economic development and growth. Likewise, it will be a special task in the years ahead to cope with the demand for increased airport capacity, especially in the South-East of England.
There should be plenty for readers of Airline Business to focus on between now and 2035. They will need to depend, as will the aviation industry as a whole, on the insight and integrity its editorial staff have shown over the past two-and-a-half decades. That is a challenge. It is also a priority.
COVER STORY: AUGUST 2000
| FROM THE ARCHIVES To all outward appearances, Sir Michael Bishop is the very image of the reserved English gentleman. The impression is only emphasised by the setting of his office in the British Midland headquarters at Donington Hall - an 18th century manor house complete with flags and turrets. |
Source: Airline Business
