Aviation Insights: People and places, not buildings and spaces

INSIGHTS AND TRENDS – AIRPORTS

People and places, not buildings and spaces

The State of Aviation — Worldwide Travel Outlook

Despite turbulent times, the aviation industry is positioned to take off in 2022. As countries around the globe transition from total border closures to measures that focus on vaccinations and testing, the travel industry is experiencing a revival.

According to IATA, the worldwide domestic travel recovery will reach 100% of 2019 in the fourth quarter of 2022. However, the International recovery will only reach about 50%. Overall industry recovery will achieve 70% by the fourth quarter of 2022. However, recent developments in the Ukraine might slow some of this anticipated recovery due to restrictions over air space.

Based on these trends, our updated air travel outlook for 2022 includes:

• Global airline revenues for cargo and passenger forecasts will climb back to 79% of 2019 levels, when the global airline industry generated a net profit of $25.9 billion.

• The North Atlantic to and from the UK, European Union and much of the Middle East should return to 2019 levels in the summer of 2022, driven by strong leisure (vacation) demand.

• While the omicron variant outbreak in the United States initially reduced demand for travel from the United States to India, airlines are indicating that future demand is strong and are adding service.

• Travel between the Americas should also return to 2019 levels in the summer of 2022. While vaccination rates continue to increase, countries in Central and South America do not have highly restrictive border controls and are not expected to impose them.

• Travel across the Pacific will take longer to return. Important markets such as China, Japan and South Korea limit travel to “essential reasons”. China and Japan limit travel to returning nationals, foreigners with residency permits and diplomats.

• Travel to countries with low vaccination rates will not likely return until 2023. While the worldwide vaccination rate continues to climb, distribution of vaccines continues to be uneven. This status applies to the entire continent of Africa and many countries in Southeast Asia, such as Pakistan, Bangladesh, Indonesia and the Philippines.

• The return of business travel may be slower as some business interactions, such as internal company meetings, will remain on-line. By summer of 2022, most airlines will have worked through their staff shortages and should be able to operate their entire aircraft fleets.

• Air cargo volumes are expected to keep this higher volume of cargo through 2022 and beyond.

• The chaotic situation in Ukraine and its subsequent effects on the world economy is evolving rapidly. Making predictions about an end state of new economic relationships and airspace restrictions remains difficult. However, many of the scenarios under consideration show a new air travel environment that looks much like what existed during the Cold War (1945-1989).

Sustainability and the Roadmap to Zero Carbon Airports

Airports around the globe are establishing sustainability initiatives. In November 2021 at United Nations Climate Change Conference (COP26) , the United States announced their first Aviation Climate Action Plan. The Plan establishes a roadmap to achieve net-zero greenhouse gas emissions from the U.S. aviation sector by 2050.

Sustainability at Chicago O’Hare International Airport

The Dar Group is proud to have led the sustainability initiatives of the Chicago Department of Aviation (CDA) since 2003. The CDA recently announced the $8.5 billion O’Hare 21 development program, which includes terminal redevelopment and other capital program at Chicago O’Hare International Airport. CDA updated thier industry-leading Sustainable Airport Manual (SAM) earlier this year to enhance the focus on sustainability strategies for terminal space, and to enhance the passenger experience. SAM will continue to be incorporated into all O’Hare 21

The partnership between the United Nations Climate Change and Airports Council International has sparked growth in the climate action of airports. These actions include emission reductions by airport operators: investment in renewable energy; energy efficient lighting and heating systems; and operational changes.

To successfully reduce their carbon footprints, airport operators

need to invest in two critical areas. First is the need to shift to more sustainable energy sources to replace aviation fuel. Secondly, design energy sustainable airports that do not consume massive amounts of energy. Our airport sustainability expert Richard Palmer walks us through what it would take to make airports attain zero carbon emissions.

CHALLENGES THAT AIRPORTS FACE IN REDUCING THEIR FOOTPRINT

Airports have unique needs that make it challenging to adopt sustainable practices immediately. Here are some key challenges that impact airports in their mission to zero-carbon airports.

• Addressing scope three emissions. Perhaps one of the biggest challenges that many airports worldwide face is how to deal with scope three emissions. Simply defined, Scope 3 emissions are emissions from third parties or activities from their assets that the airports have no control over or do own. Airports do not own the planes that land on their premises, which may be challenging to regulate.

• Little to no technological substitutes. Most industries hitting their carbon reduction goals have technology to thank. However, there are no technological substitutes for fossil fuels in the aviation industry. This makes it generally difficult to reduce carbon emissions due to how airports and the aviation industry are set up.

• Slow industry trends. We have seen lots of disruption in other industries but almost no change in how the aviation industry works recently. Richard Palmer, our industry expert, ascertains that the aviation industry hasn’t seen much change. Aviation leaders have to wait for significant events such as the 9/11 bombing to change their operations.

REALISTIC ROUTES TO ZEROCARBON AIRPORTS

Airports can adopt impactful approaches that can make them sustainable even if they do not have the resources to make massive changes. Here are three actions that an airport can do to attain net zero carbon emissions.

Optimize their buildings and operations

Airports offer an intermodal form of transport as they deal with both land and air transport. While it may be difficult to reduce the footprint from the aviation aspect, operators can streamline some processes to make them energy efficient.

They can do so by reducing their reliance on electricity and increasing their use of renewable energy from local firms. Renewable energy can help heat the buildings, cooling, cooking, and even lighting.

Airports also have to think about the electrification of vehicles in their premises since they offer intermodal transport. According to Richard Palmer, they can contract car hire services that use electric cars or even set up charging ports for their clients.

Localized generation of power

It may be difficult for airports to generate renewable energy. However, they can look up to their surrounding local communities for help. Airports can enter partnership agreements with local solar and even wind energy producers. Alternatively, they can set up their renewable energy systems, such as investing in roof solar.

Offset residual carbon

It may be difficult to attain net-zero carbon emission as there is bound to be residual carbon. This is because airports are made from other materials that may also have a footprint. A great way around this is focusing on the big solutions that can make an impact, such as reducing carbon footprint by 95%. Airports should also focus on nature-based solutions and avoid commercial solutions that will require expensive investments.

TOP 3 THINGS FOR AN AIRPORT TO DO TO BE SUSTAINABLE

While sustainability may prove difficult for airports, it is not entirely out of reach. Airport operators can take a couple of actions to step up their net-zero emissions campaign. These are some things that operators can do today for a more sustainable industry.

Sign renewable power purchase agreements. Airports need to end their over-reliance on non-renewable sources of energy. Yes, there is currently no renewable energy for jet fuel, but there are other ways to reduce your overall carbon footprint.

Richard Palmer suggests signing renewable power purchase agreements to reduce the dependence on electricity and other non-clean fuel. Such renewable energy can come in handy when powering other airport operations. This may seem insignificant to some, but such small acts merge at the end to create a much more significant impact. The goal here is to get as many of your systems in renewable energy as possible.

Energy operations optimization. Savvy airport operators should know how much of their operations are energy efficient. Our industry expert, Richard Palmer, says that there are probably lots of fat in the system if you haven’t done anything to address your carbon/energy emissions.

If you have old systems in your airport, you may be running unnecessary operations that eat up your energy. Richard Palmer argues that airports should follow the example of property organizations that seek to minimize their energy consumption year after year.

This is possible through conducting regular energy audits, embracing energy performance contracting, and creating incentives for the whole organization to adopt sustainable practices. Other ways include having lighting controls, efficient air conditioning, microgrid types systems, and shared thermals systems. Adopting such practices opens you up to green financing that can help them improve their operations.

Good resilience planning. It is impossible to know what will adversely affect the aviation industry. That said, the best airport operators have great resilience planning that helps them when things turn for the worse.

A good resilience plan should outline what to expect, such as extreme weather patterns or storms. You can then get the primary and secondary impacts on buildings, land, and air transport. With this, you can build scenarios and even contingencies on climate issues that may affect your airport operations. You can also take advantage of emerging technology such as hydrogen fuel, batteries, and other synthetic fuels.

Technology Accelerates the Growth of Airports

Airports have remained a relatively rigid area when it comes to technology adoption. Most processes central to airport operations have been in place for decades despite the emergence of more effective and cost-effective technologies. If there is anything recent developments and the Covid-19 pandemic have taught us, however, is that this rigidity is not exactly a product of logical vigilance. More and more technologies are successfully infiltrating airport operations, and aviation seems to be taking a new trajectory as regards embracing emerging technologies.

TOUCHLESS TECHNOLOGY

Until the COVID-19 pandemic, touchless technology has always been viewed as the future of self-service in airports. Early adopters are not only gaining the favor of governments and the various jurisdictions they fall under but also attracting more health-conscious travellers and speeding up the usually protracted check-in process.

High contact touch points have been eliminated thanks to the increased use of automated gates and built-in readers.

The use of biometric authorization has also reduced the check-in hassle as customers can now move from the entrance to their flight using only their face as ID. The user simply stands in front of a screen, and the gate automatically slides open upon authorization.

DATA DEMOCRATISATION

Data democratisation is the process of making passenger, airport, and airline data accessible and available for use to all stakeholders. The point is to reduce silos and provide a more unified experience to passengers.

Airlines have always been reluctant to share passenger data with airport authorities, other airlines, and concessionaires, tactfully citing security mindfulness. Now most are for the idea of sharing information and sourcing it from the same pool thanks to an increased need for passenger experience personalization.

Concessionaires are also considering using a single point of sale system to simplify data collection and sharing.

REPLACING AIRLINE APPS WITH AIRPORT APPS

When a passenger frequently changes airlines, it is difficult to monitor them and understand their preferences. This is especially true if each of the airlines has a separate customer app.

Using the same app enhances data democratisation and makes it easy for concessionaires to prepare offers for passengers days before their flights. They can also accurately prompt their prospects to make orders of items they are interested in via personalized marketing materials. It is a tested-and-tried way to reduce chaos at concessionaires, run high-ROI marketing campaigns, increase sales, and optimize inventory management.

CARBON OFFSETTING

On an hour-to-hour basis, flying is arguably the most carbon-intensive activity anywhere in the world. Thanks to the “flight shame” movement, more and more people are now aware of the hefty carbon print associated with air travel and are subtly demanding for change. Some are ditching planes for trains, while others are avoiding activities that involve air travel altogether. Others are opting to purchase carbon offsets to neutralize their contribution to an aircraft’s emissions during a flight.

Over 30 IATA airlines have an offset program run by a third-party provider or integrated into their digital sales engines. With the number of airlines offering carbon offsetting increasing by the day, more eco-conscious people are expected to go back to short-haul air travel much to the benefit of airports and concessionaires.

USE OF ROBOT WORKERS

Some sectors such as manufacturing have successfully incorporated robotics into their daily operations. For airports, the way forward hasn’t always been clear as most operations involve direct interaction with customers. There is also no denying the fact that robots are a huge investment that are only viable if put in efficient use cases.

Currently, robotics is being used in the following airport applications:

• Baggage handling. Robotic systems, like the one at Dallas Fort Worth International Airport, can move more than 400 bags per hour between conveyor belts for international connecting flights.

• Service desk assistance. Heathrow airport recently introduced robot assistants to its busiest concourse, Terminal 5, to provide real-time flight information, answer questions, and guide passengers to various facilities. The robots are mainly charged with addressing more straightforward concerns, while employees take care of the more demanding issues.

• Administrative and regulatory tasks. Robotic process automation uses software robots to perform repetitive tasks like filling out and filing paperwork, writing employee schedules, etc. This frees up employees for value-adding processes.

• Sanitation. By automating bathroom cleaning and other processes, airports can ensure cleanliness and health without exposing their employees to harm. The cleaning robot introduced at Gerald R. Ford International Airport in Michigan disinfects surfaces using ultraviolet light and can clean a room in as little as 10 minutes.

TECHNOLOGY EMPOWERS AIRPORT OPERATORS

As the past couple of decades have taught us, it is virtually impossible to envisage what technology will look like in five or ten years. Nonetheless, it takes time for anything to go mainstream, so it isn’t difficult to imagine what will be breaking into aviation in the foreseeable future. For the above six technologies, the adoption process has started, and the warm reception they have received is nothing short of an indicator that they are indeed here to stay.

Technology Reinvents the Airport Retail Experience

The number of airport users continues to rebound from the lows of 2020. Just recently, Dubai International Airport was voted as the world’s busiest airport, with more than 29 million users visiting the airport in 2021. And while aviation is big business, airport retail shows a lot more growth potential for airports.

Airport retail is getting much more complex as retailers face an imminent technology disruption that will change their operations. Technology will disrupt traditional airport retail as it has evolved the traditional retail industry. The ability to adapt to new technology will redefine the leaders and followers.

The potential for innovation to influence the bottom line, is forcing airport retailers their rethink their business model. The goal is to redefine the traveler’s customer experience using different contact channels with the help of technology. Retailers that do not adapt quickly may not survive the disruption.

UNDERSTANDING THE NEED FOR CHANGE

Traditional retail is a big part of the aviation industry as most people stop to shop for souvenirs in the different cities as they await their flights. Various changes have started to emerge, and airport sellers need to understand what fuels these changes.

• Rapid technology development. Innovation has caused a massive shift in how people shop. Travelers want to shop conveniently and enjoy a speedy, efficient delivery. This has prompted airport retailers to rethink their whole shopping process and how they deliver products to their buyers.

• Demographic changes. Much younger, affluent travelers are gracing airports worldwide. This generation of travelers is digitally focused and expects instant gratification. Airports must rethink their retail models with this generation in mind.

AIRPORT RETAIL TRENDS TO WATCH OUT FOR

Ibrahim Ibrahim, our aviation industry expert, ascertains that airport retailers will have to rethink how they sell and what they sell. Technology will continue disrupting the commerce industry, and it is prudent for retailers to be aware of emerging trends. Here are a couple of changes you can expect in the foreseeable future.

Quick commerce

Customers no longer want to wait for hours on end or queue up in endless lines to buy what they need. Technology has made it possible for retailers to reduce the average shopping and wait time. This change will also bring a massive shift in how airport retailers sell their products.

But what exactly is quick commerce, and how will it revolutionize airport retail?

According to Ibrahim Ibrahim, quick commerce involves using a technology platform to get orders from airport retail shoppers and deliver them in ten minutes or less.

The benefit of quick commerce is that you can utilize a smaller retail footprint in the airport. All the retailer will need is a fulfillment hub and to lay down the necessary logistic infrastructure that would allow them to deliver goods or services rapidly.

Brand spaces

Brand spaces have sprung up in several industries, and they are pretty compatible with the aviation industry. Ibrahim Ibrahim asserts that there will likely be three types of brand spaces, including transactional community and recruitment fulfillment.

Under transactional fulfillment, airport retailers can improve the customer experience to influence their purchase decision. For example, they can give potential clients more details about the product and how they make it. Delivery is anywhere in the airport, even aboard the plane, and the best rent model in such a case is the standard turnover rate.

Community fulfillment is where a brand may take up space in the airport and attract people who follow certain interests such as yoga, food, or even whiskey. Brands can then create spaces for communal or social experiences for the classes. A reasonable rent model could consider the number of people joining the communities, a subscription model, or visitors’ time in the spaces.

Lastly, airports can also take a recruitment brand space. This is where they can attract and push people to their online or social platforms such as Twitter. Using the impressions from the recruitment space is a great rent model.

A digital twin of your airport

Airports found a couple of ways to create bustling physical retail spaces in the past. This means that travelers can access different amenities when they land at the airport. Creating a digital version of the airport multiplies these opportunities.

Having a digital twin of your airport gives you access to big data that you would not otherwise access. The digital version will help you collect more data from people who want to book their flights, shop, check-in, and much more. You can quickly analyze this data too.

A digital version of the airport also reduces the need for businesses to take up too much space. Players in the food and beverage industry, for example, can hire much less space and deliver their food to clients around the airport.

Technology can help integrate airport retail’s physical and digital aspects to create a unique experience for customers. Some of the different types of technology that can change the game include smart vending, socially-enabled signage, sensing feeling that measures your mood, and data tools that map social media behavior.

REINVENTING THE AIRPORT RETAIL EXPERIENCE

You can expect a lot of technology disruption in the airport retail industry soon. Rapid changes in technology and the traveler population are the primary reasons for disruption. People now want to shop conveniently, which prompts the need for quick commerce. Airports will also change how they use and hire their spaces with the emergence of different brand spaces. Having various types of brand spaces increases the revenue for airports while creating unique experiences for travelers. Airports can create a digital version of their space to maximize space and offer outstanding customer experiences.

Exploring Opportunities to Streamline Airport Security and Baggage Handling Systems

Airports continue to go through transformations to improve the services they offer to their customers. As the rate of air travel increases, travelers are demanding more from their flight experiences. On average travelers are recommended to arrive at least two hours before their departure time to allow for parking/shuttle transportation, airline check-in, and going through the security screening process. In addition, moving baggage through an airport to the aircraft is often labor and time intensive.

The adoption of emerging technologies will improve airport security and baggage handling processes. These improvements will not only affect airport security but will also impact the whole travel experience. Our industry expert Ihab Osman explores the emerging trends that will improve the passenger experience.

IMPACT OF TECHNOLOGY ON AIRPORT SECURITY AND BAGGAGE HANDLING

Distributed versus central security

According to Ihab Osman, one of the most significant changes airports may experience will be the shift from central to distributed security. Central security systems present a couple of problems in airports. First, they are targets of cyber threats since all, or most security systems can be controlled from one place. Gaining control of the main control room is a sure way to compromise the whole airport’s security. Second, security and baggage handling systems may face some downtime, which is avoidable if the system is decentralized.

Airports can create several decentralized security systems if they wish to mitigate this problem. For example, there can be separate screening checks to ensure that business does not stop when one machine is facing some downtime.

Automated screening

Screening is an integral part of any airport’s security. The problem is that it takes much time when a large airport serving thousands of visitors every day has to screen every person. Installing automatic screening checks is a sure way to reduce the time it takes to screen someone. How will this work? Well, there may be systems in place to screen some people at home or upon their arrival. This will reduce the time we spend in airports as long as the airport can offer a fullproof way to screen someone away from the airport, says Osman.

Use of robots in baggage handling

Baggage handling is an essential airport process. However, bag handling systems are often bulky and are prone to failure. Ihab Osman asserts that bag handling systems consume the most space and rarely achieve optimum operating capacity.

In the future, airports will resort to robots in their bid to automate the bag handling processes. You will only have to drop your bag at a robot, which then goes through tunnel disinfection and loads your bags in the plane. The only challenge, according to Osman is the creation of robot paths to eliminate collision and programming robots to reroute any luggage when there is a problem. Using robots will reduce human accidents in airports and increase bag handling efficiency.

Automated delivery of services

Airports will also witness changes in how they offer products and services to clients. The automation of services and the use of AI in airports will be a game-changer. You will no longer have to be physically present to get access to services. Airports will move to transmit all information and data that you need online. This means that you will check up on everything, such

as parking through a mobile app.

The delivery of products and services such as foods will also get automated. For example, airport retail outlets may deliver any food you order when you are in a different part of the airport. But a robot will likely serve you. Automation will reduce our time in airports, improve security, and increase revenues as airports hire fewer people.

EVOLVING AIRPORT OPERATIONS AND TRAVELER’S EXPERIENCE

Airports have gone through rapid technological advancement in the last two decades. This trend will continue into the near future as airports employ smart technologies and data collection to transform their operations and traveler’s experience. Artificial intelligence across all spheres represents a critical technology that will impact how airports operate. This technology will automate

screening and delivery of services throughout the airport. The use of robots in handling baggage will also help reduce the challenges of poor bag handling in airports. Data collected across the airport enterprise will play a role in shaping the design of airports of the future. The traffic flow of people within the airport is just as important as the planes arriving and departing its runways. Innovation will continue to enable airports to improve the experience of its travelers and realize cost savings along the way.

Dar Group is an international network of professional service firms comprising over 19,800 staff members assisting clients in over 100 countries around the world. We are dedicated to planning, designing, engineering, and project managing facilities, installations, and structures that contribute to the sustainable advance of communities worldwide.

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