Routes News Magazine, Issue 7, 2014

routesnews ISSUE 7 VOL 10, 2014

The world air service development magazine

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Looking to the future: Emirates’ Sir Tim Clark SPECIAL REPORT: Düsseldorf Airport

IN THE SPOTLIGHT:

Etihad dares to be different

ANALYSIS:

Global traffic trends

routes-news.com World Routes Chicago Report Back:

Tourism Summit:

Strategy Summit:

Marketing Awards:

Event News:

The future of travel

The critical issues

All the winners

All the top stories

EDITORIAL Joe Bates, Group Editor +44 (0)208 831 7507 joe@aviationmedia.aero Jonny Jonny Williamson, Williamson, Senior Senior Reporter Reporter +44 (0)208 (0)208 831 831 7560 7560 +44 jonny.williamson@routes-news.com jonny.williamson@routes-news.com Justin Burns, Reporter Justin Burns, +44 (0)208 831Reporter 7508 +44 (0)208 831 7508 justin.burns@routes-news.com justin.burns@routes-news.com

SALES SALES

Rebecca Randall, David Group McCauley, Advertising Director Senior Advertising Manager +44 (0)208 831 7513 +44 (0)208 831 7515 rebecca.randall@routes-news.com david.mccauley@routes-news.com David McCauley, Advertising Manager PRODUCTION +44 (0)208 831 7515 Elaine Harris, david.mccauley@routes-news.com Design & Production Manager elaine.harris@routes-news.com

PRODUCTION

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Editorial comment

D

oesn’t time fly when you are having fun? It is hard to believe, but we are in November already, and as this is the final issue of Routes News in 2014, it seems appropriate to reflect on a busy and eventful year.

In terms of Routes events, it certainly proved to be six of the best, with each and every one of this year’s events from – Routes Americas (San Salvador, El Salvador); Routes Asia (Kuching, Sarawak, Malaysia); Routes Europe (Marseille, France); Routes Africa (Victoria Falls, Zimbabwe); Routes Silk Road (Tbilisi, Georgia); and World Routes (Chicago, Illinois, USA) – proving to be an outstanding success.

Indeed, some are already labelling Chicago as the best ever World Routes, and you can read more about the hugely successful event in the special 12-page Report Back feature in this issue.

It was also a year of celebrations, with the World Route Development Forum celebrating its 20th anniversary; Vantage Airport Group its 20th anniversary; Virgin Atlantic its 30th birthday and Wizz Air its tenth.

Other selected highlights have included Norwegian Air Shuttle launching low-cost, long-haul Dreamliner flights between London Gatwick and the US; Etihad bailing out Alitalia through the purchase of a 49% stake; record-breaking aircraft sales; and the opening of Qatar’s new Hamad International Airport and Heathrow’s

new Terminal 2, otherwise known as the Queen’s Terminal.

Another positive story that appears to have gone under many people’s radar is aviation’s new commitment to sustainable growth made during the recent United Nations Climate Summit in New York. Based on a pledge to work more closely with ICAO and other business and government groups through the Air Transport Action Group (ATAG) to reduce CO2 emissions, the new commitment expands on a host of existing industry initiatives and is vital to ensure the long-term future of aviation.

On the downside, the undeniable low-point has been the tragic loss of Malaysia Airlines flights MH370 and MH17. Other lows have included Air Uganda ceasing operations; the closure of Manston and Blackpool airports in the UK; and the ongoing Ebola outbreak.

Finally, we are delighted to announce that former Airlines International editor, Graham Newton, is the new editor of Routes News and will officially take up the hot seat on December 1.

KEEP IN TOUCH

info@routes-news.com @routesnews facebook.com/routesnews

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ROUTES NEWS 7, 2014

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Contents

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20

8 World news

16 Daring to be different

11 Cargo news 13 On the move 14 Airline one2one

Emirates president Tim Clark shares his views on competition, growth, the A380 and safety.

24

Unable to equal the size or history of its biggest peers, Jonny Williamson discovers how Etihad Airways tore up the rulebook and found an alternative route to success.

20 Growth trajectory

CEO, Thomas Schnalke, talks to Joe Bates about rising traffic figures, an expanding route network and the growth potential of Düsseldorf Airport.

24 Making the right connections

A growing route network, enhanced facilities and a host of customer service innovations ensure that these are exciting times for Montréal-Trudeau, writes Joe Bates.

26 Good times and blurred lines

ASM’s senior vice president consulting and product development, Nigel Mayes, reviews this year’s global traffic trends.

Download the free app View all the latest issues; just search for ‘Routes News’ in the Apple or Android app stores. routes-news.com/app

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ROUTES NEWS 7, 2014

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Contents

29

34

29 World Routes 2014 Chicago Report Back

‘The most American of American cities’ proved an ideal location to mark the 20th anniversary of World Routes, with thousands of aviation and tourism delegates joining in with the celebrations.

ROUTES NEWS 7, 2014

38 Back on top

New business strategies and dozens of new routes have helped Chicago O’Hare reclaim its status as the world’s busiest airport for aircraft movements, writes Jonny Williamson.

41 Boogie Wonderland

46 Events essentials

Now in its eighth year, Routes Americas will make its first appearance in the US next year when it arrives in Denver, Colorado. Meet the team: Head of airline relations, Mark Gray, reflects on an unforgettable World Routes and looks ahead to what 2015 holds in store.

49 View from the top

Andrew Herdman, director general, Association of Asia Pacific Airlines.

Delegates were truly spoilt at this year’s World Routes with a number of unique evenings laid on by the generous hosts.

43 VisitMe

A number of hosted stands within the networking village offered delegates the opportunity to win prizes during their time at World Routes.

34 Record breaker

Brussels Airport’s head of aviation marketing, Léon Verhallen, talks to Jonny Williamson about his gateway’s triumph in the World Routes Marketing Awards for 2014.

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33 Read all about it!

It was confirmed at World Routes that Bahrain Airport Company would host the first ever Routes Middle East & Africa forum, which will take place next year.

37 The future of travel

A distinguished panel of speakers broached topics such as the likes of shifting traveller demand; ensuring efficient passenger flow; rising stars; and what the future may hold.

30 Critical issues

Addressing aviation’s biggest challenges was the source of much debate, taking in airport infrastructure, regulation, profitability, privatisation and sustainability.

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45 Africa is ready

Next year will see the 21st World Route Development Forum head to Africa for the first time when the event comes to the coastal city of Durban.

The HUB, your weekly, central source of information for everything related to Routes and Routesonline, is delivered to your inbox every Friday.

It includes event updates, airline and airport profiles and news and analysis.

Sign up to receive The HUB at www.routesonline. com/register/

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World news

Virgin takes an axe to Little Red Virgin Atlantic Airways has confirmed that it intends to end the operations of its short-haul brand next year. Operated on its behalf by Aer Lingus, Little Red’s London Heathrow–Manchester service will cease at the end of March, with its links to Aberdeen and Edinburgh concluding at the end of September.

Coming just two years after launching the three routes, the decision follows a major review of Virgin Atlantic’s wider network.

Air Transat is launching a new Toronto–Montréal– Budapest route, marking the return of North American long-haul service to the Hungarian capital after a break of six years.

WestJet has named Glasgow as its newest European destination with the introduction of a daily

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The airline commented that Little Red was conceived as an attempt to “reintroduce consumer choice on key domestic services” following British Airways’ takeover of bmi regional. However, it claims that the brand has been unable to make “a positive contribution to Virgin Atlantic’s network.”

It’s CEO, Craig Kreeger, noted: “It was always a huge challenge on behalf of the consumer, as the totally inadequate number of slots made available by the

non-stop seasonal service from May 2015. Departing from Toronto Pearson International, the flight operates via Halifax Stanfield, Nova Scotia.

Russian carrier, Transaero, is expanding its network from Moscow and St Petersburg with the addition of 11 new domestic

European Commission did not deliver close to BA’s network position, even when supplemented by our own slots to fly between Heathrow and Manchester.”

Though Little Red had strengthened its market position after a slow start to become a strong competitor to BA in the point-to-point market, “this challenging environment meant Little Red ultimately did not deliver the results we had hoped,” Kreeger concluded.

routes previously never served in a winter season.

trade between Mexico and the US.

Volaris has increased its international network with the addition of Guadalajara–Portland.

The airline hopes the route into the Oregon market will strengthen connectivity and promote cultural, economic and commercial

WOW air is to launch low-cost A321 services between Reykjavik and Boston Logan and Baltimore/ Washington from March 2015.

The new services will make it possible to fly between London and the US cities via Iceland for as little as $160.

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Ethiopian and ANA join forces Ethiopian Airlines and All Nippon Airways (ANA) have signed a codeshare agreement in a bid to strengthen connectivity between Africa and Japan.

This winter, travellers will be able to book connecting flights on Ethiopian services between Addis Ababa and Bangkok; Hong Kong; Frankfurt; Paris; London; Nairobi and Mombasa through ANA.

In return, the African flag carrier will place its code on ANA’s daily Bangkok–Haneda and Hong Kong–Tokyo Narita routes.

Both members of Star Alliance, the two carriers have previously co-operated in regards to offering a joint frequent flyer programme (started in December 2011).

Qatar announces first A350 route The Gulf carrier has named Frankfurt as the inaugural destination to receive its much-anticipated extra widebody (XWB) aircraft. Currently serving the German city twice daily from its hub at Doha’s Hamad International Airport, Qatar is preparing to upgrade one flight from next January with the second coming shortly after.

The airline stated it selected Frankfurt due to the “significant capacity the aircraft provides for the comfort of its business and leisure travellers.” The global launch operator for the aircraft, Qatar has 80 A350s on order and expects to induct the first eight into its fleet before the end of 2015.

AIR ARABIA HITS 100

Georgian capital, Tbilisi, becomes the airline’s 100th destination.

A380 UPGRADE

Emirates enhances its services to and from Milan Malpensa from December.

CAMBODIA CALLING

Vietjet to add a daily Hanoi–Siem Reap service from early November.

Take off

or not FIERCE COMPETITION

Lufthansa to stop flying between Germany and Abu Dhabi next summer.

TORONTO TERMINATED

Gatwick gets graphic Gatwick Airport brought something a little different to this year’s World Routes Networking Village with an evolving graphic art mural taking shape over the three days. Capturing the airport’s story (such as its

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transformation under new ownership and its case for a second runway), the talented illustrator and scribe, Clarice Holt, also brought to life some of the key commentary and themes discussed during the event.

Aeroflot cancels all of its direct flights to Canada due to weak demand.

END OF AN ERA

Blackpool International Airport shuts its doors after more than 100 years of operations.

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Cargo news

Cathay boosts Canadian network Cathay Pacific Cargo has launched a twice-weekly scheduled service to Calgary International Airport, one of Canada’s fastest-growing cargo hubs.

The inaugural B747-8F service touched down on the morning of October 18, having operated on a Hong Kong–Anchorage–New York JFK–Calgary–Hong Kong routing.

Flying machinery and perishables from Calgary to Hong Kong, the service connects with Cathay’s extensive Asian network. The carrier now operates freighter service to 44 global destinations, 16 of which are located in North America.

Cathay’s cargo director, James Woodrow, said that he was pleased to offer “one of the fastest and most convenient ways to move time-sensitive freight from Central Canada”, with the new route helping to reduce time spent in transit and associated handling costs for customers.

Cathay currently has 13 B747-8F aircraft in its fleet, with an additional aircraft on order for delivery in 2016.

Network expansion for Lufthansa Lufthansa Cargo has strengthened its footprint on the African continent with the addition of Lagos, Nigeria and Tunisian capital, Tunis, to its route network.

Director for Africa, Hermann Zunker, commented that the region was a real “growth market” and increasingly more important. He noted that Tunisia has become one of Africa’s most competitive countries, and described Lagos as “Africa’s Big Apple”.

In addition, Lufthansa Cargo and All Nippon Airways are due to begin a strategic joint venture on routes between Japan and Europe from December 2014, with services to the Colombian capital, Bogotá, being reintroduced from January 2015.

Sponsored by

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NEWS IN BRIEF Boeing has predicted that world air cargo traffic will double by 2033, growing at an annual rate of 4.7% over the next 20 years. If current trends continue, the manufacturer stated that 2014 could be the highest growth year for air freight since 2010, with Asia–North America and Europe–Asia markets showing the strongest growth.

Having discontinued operations almost 20 years ago, Aurora Air International has announced its intention to establish a new world headquarters at MidAmerica St Louis Airport. Its president, Carlos Smith, anticipates first flights on MidAmerica-based routes to commence from next spring.

As a result of continued growth in recent years, Garuda Indonesia has announced that its freight subsidiary, Garuda Indonesia Cargo, intends to join the SkyTeam Cargo alliance during 2015. Seen as another important step towards network expansion, a Memorandum of Understanding (MOU) between the two parties was signed on October 8.

Milestone for IAG IAG Cargo has opened the 100th station in its extensive ‘constant climate’ network, a specialist service for time and temperature sensitive pharmaceutical products.

This latest station, Bordeaux, follows swiftly on from others recently opened in strategic locations around the world, including Nairobi, Hong Kong, Shanghai and Osaka. Stockholm, its 101st station, is planned to open before the end of October.

IAG Cargo’s global head of pharmaceuticals and life sciences, Alan Dorling, commented that the global pharmaceutical market is growing at a “terrific rate”, more than 5% annually.

He added that this was a “huge opportunity” and the airline was in a “superb position to exploit it”.

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On the

move KLM has announced that its chief executive officer, Camiel Eurlings, has stepped down to make way for Pieter Elbers. A KLM veteran, Elbers started his career with the Dutch carrier more than 20 years ago and has held the position of chief operating officer and deputy CEO, and been a member of KLM’s board, since April 2012.

Philip Micallef has taken up the mantle of Air Malta CEO following the resignation of Louis Giordimaina.

Having occupied various management positions over the past 30 years, Micallef commented that he was “privileged” to be tasked with such an important role and that he was “under no illusions” regarding the challenges that lie ahead.

Etihad Airways has named Bruno Matheu as COO for Equity Partners. With almost three decades of senior management experience, the French national most recently served as chief long-haul officer at Air France. Matheu will assume his new role in December, when he will be responsible for leading strategic developments to optimise

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business performance, revenue and cost synergies between Etihad and its global equity partners.

JetBlue has named Robin Hayes as the successor to its departing CEO, Dave Barger. With a handover date set for February 15, the airline’s chairman, Joel Peterson, thanked Barger for his contributions over the past 16 years and noted that his “talent, intellect and leadership” has helped to make JetBlue what it is today. Prior to being named as the carrier’s president in 2013, Hayes spent almost 20 years with British Airways, culminating in a term as its executive vice president for the Americas.

Airlines for America (A4A) has promoted current chief financial officer, Paul Archambault, to senior vice president, chief financial and operating officer. Now in his third decade with the industry trade organisation, Archambault has held various roles of increasing responsibility throughout multiple disciplines within the association.

Arnd Schwierholz has been appointed deputy

CFO of Air Berlin. A veteran of airline finance, his professional background includes positions within UBS Investment Bank, experience as a company founder and head of mergers and acquisitions for Lufthansa. Most recently, he was North American CFO for LSG Sky Chefs, Lufthansa’s catering subsidiary.

London Luton Airport has announced that Nick Barton will assume the role of CEO from the end of 2014. Having previously served at Stansted Airport, Barton joins London Luton at an exciting time, with the airport embarking on an ambitious £100 million transformation plan to increase annual passenger numbers from 10 million to 18 million by 2026.

David Goldstein has been named president and CEO of the Canadian Tourism Commission, effective December 1.

Currently holding an equivalent position at the Tourism Industry Association of Canada, Goldstein was one of the key architects of the Federal Tourism Strategy with Industry Canada.

Pieter Elbers

Bruno Matheu

Paul Archambault

David Goldstein

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Emirates president Tim Clark shares his views on competition, growth, the A380 and safety.

Should US carriers like American Airlines fear Emirates?

With the recent addition of Boston [March 2014] and Chicago [August 2014], Emirates now serves nine points in the US – three in the west, three in the centre and three in the east – and there are more coming. Firstly, why should American carriers be concerned about something that is essentially good for the consumers, the cities and the industry in the US? Secondly, many of the points that Emirates serve, particularly to the east of its Dubai hub, have no American presence whatsoever, with numerous examples across Africa, India, Pakistan, Iran and so on.

Like many other American cities, World Routes host, Chicago, has been starved of international capacity by the foreign carrier community.

Emirates is redressing that imbalance at a time when American carriers are going through major changes, and many of them seem, now, to be making good profits.

What is your future strategy regarding US expansion?

Our network focuses on destinations in the east, west and centre, so of course, we are looking for more points in each of those regions. We will also continue to expand into the US; after all, the country is a hugely important market and the powerhouse of the planet.

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Currently, the US accounts for around 7% of our route revenue, which actually isn’t as big, for instance, as the UK or Australia, both accounting for around 9%. Following the success of our routes into Chicago and Boston we are now pushing for a third flight into JFK and have placed the A380 into Los Angeles.

The income the country generates for Emirates represents a steadily growing part of our business and, as the balance shifts in the future, it’s likely that the US will be one of our top three markets by income.

There is a perception that Middle Eastern carriers don’t operate on a level playing field, benefitting from subsidies, interest-free loans and governmental support.

How do you respond to that?

Government support comes in many different forms. The crucial factor is that the governments of Dubai, Abu Dhabi and Qatar understand the importance of aviation and what it brings, so have made it a major facet of their economic transportation policies.

Emirates started well before the other two main carriers [Etihad and Qatar] with $10 million in start-up capital. That capital was given on the conditions that we wouldn’t be given any more; we wouldn’t become unprofitable; we wouldn’t gain bank guarantees

against the Government of Dubai; and that the emirate’s skies would always be open, so we must compete with everyone else.

The international business community regarded our industry as always losing money; so as time passed and Emirates expanded its operation, took on additional aircraft and became noticed around the world, the notion grew that the only way we could be succeeding was through subsidies.

Nothing could be farther from the truth.

We’ve been highly focused and had no stakeholder involvement at all. The difference for us was our government has been proud of Emirates, recognises how Dubai has benefitted and is therefore prepared to actively support airport build programmes and try to address infrastructure constraints.

You’ve recently taken delivery of your 50th A380, with another 90 on order.

What’s your love affair with the aircraft?

I always say to my fellow CEOs, buy the A380, it’s wonderful for seat-mile economics, but they all reply that they can’t fill it! To which I say, if you can’t, how can we? It’s a question of what you do with the aircraft.

When Airbus gave us the A380, we designed the cabins, seats, suites, showers and baths. We didn’t leave it to anybody else because we were trying

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Airline one2one

to align what we did with this fabulous aircraft with the aspirations and the expectations of the travelling public. If we have an A380 seat-factor of less than 85%, we would be quite shocked. We know that our business model would sustain more fleet and larger aircraft; the scalability of what we do is evident and the A380 will continue to play a very important role in everything we do.

You are the last member of Emirates’ founding fathers; do you have any concerns for the airline’s future when you eventually step down?

A good business model ensures continuity and I believe that Emirates has a fantastically robust model.

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I’m working with an excellent team of people, any one of whom could step up in my view; so when I go, the only thing I will say is over to you now, don’t screw it up, get on with it and good luck to you!

You reportedly made a comment that some airlines failed the industry by not passing on pertinent information in the lead up to the MH17 incident.

What did you mean?

It’s not a blame game, but Eastern Ukraine was considered to be a war zone. There was a lot of activity and aircraft were being taken out of the sky, albeit at 20,000–24,000 feet; but

there was a belief that we as an industry could continue to operate above that prescribed area. Of course with the benefit of hindsight, we now know differently. It is clear to me that airlines of some states are better equipped in the intelligence-gathering process and know a lot more than they are prepared to say. But the fact is, that information is probably there.

Regrettably, I’m afraid that Emirates and obviously Malaysia, among others, didn’t have that information, which led me to consider our need to disseminate this kind of data. If we cannot trust that the state will determine safety of operation over its territory, then it passes to the airline community, because who else is going to do it?

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Daring to be different Unable to equal the size or history of its biggest peers, Jonny Williamson discovers how Etihad Airways tore up the rulebook and found an alternative route to success.

S

uch has been its meteoric rise, and so ubiquitous is its brand, that nowadays it is hard to picture a time when Etihad wasn’t a part of global aviation.

With a history stretching back little more than a decade, the Middle Eastern heavyweight is a veritable spring chicken when compared to its rival flag carriers, many of which are nearing their respective centenaries.

Though some might view this as a disadvantage, Etihad’s directors see it as an opportunity, allowing them to study the past mistakes of others, incorporate best practice into its business model and learn to play the game slightly differently.

And its approach would appear to be working as it carried upwards of 11.5 million passengers in 2013 (up from 10.2 million in 2012) across a network comprising more than 100 international destinations.

Etihad may be a modern-day success story, but as is so often the case, with success comes criticism – and the airline has certainly received its fair share.

Kevin Knight, Etihad’s chief strategy and planning officer, notes that

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the airline’s sole shareholder, the government of Abu Dhabi, is often a cause of denigration.

“Unlike what some would have you believe, we get no free fuel. We may sit in one of the most oil-rich countries in the world, but we pay for fuel at market rates just like everybody else,” he insists.

Knight attests that Etihad isn’t the recipient of sovereign guarantees or letters of credit from the government; attributing the airline’s success to taking advantage of the UAE’s “extraordinary growth and diversification”.

Facing protectionism

The other major issue Etihad currently faces is the resurgence of protectionism, or, as Knight describes it, “increased opposition”, especially from legacy carriers.

Particularly prevalent in the US and Europe, he warns that far from just affecting Etihad, protectionism constrains global development, is inefficient, reduces competition, increases fares for customers and undermines Open Skies agreements.

The source of such strong competitor opposition is Etihad’s unusual business

model, one centred on organic expansion supported through codeshare partnerships, minority investments in other airlines and commercial propositions.

The airline currently has 47 codeshare partners located in almost every continent; four in both America and Africa; 21 in Europe; two in both China and Australia/ New Zealand; three in the Middle East and 11 in Asia/Indian subcontinent.

Combined, this virtual network serves more than 450 destinations and significantly extends Etihad’s worldwide presence.

As an example of the carrier’s strategy in action, one only has to look to India – one of the world’s largest sources of domestic growth – which Etihad serves in collaboration with Jet Airways.

Indeed, Etihad directly serves 11 markets in the Indian subcontinent, but through its codeshare with Jet Airways, that number more than doubles to 23.

Strategic partnerships

On a deeper level, Etihad has made strategic equity investments in a number of network partners to date, including Alitalia (49%); Air Serbia (49%);

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Etihad Airways Organic growth – 13 new non-stop routes by 2015 year-end

Edinburgh (June 2015) San Francisco (November 2014)

Dallas (December 2014)

Madrid (March 2015)

Tbilisi (October 2015) Baku (October 2015) Kolkata (February 2015) Hong Kong (February 2015)

J Algiers (J(June 2015) Entebbe (May 2015)

ABU DHABI

Phuket (October 2014)

Dar es Salaam (D ((December 2015) Brisbane (May 2015)

Air Seychelles (40%); Darwin Airline – rebranded as Etihad Regional – (33.3%); Air Berlin (29%); Jet Airways (24%); Virgin Australia (21.24%) and Aer Lingus (4.99%).

[Though, Alitalia and Darwin are still subject to regulatory approval].

Its most recent addition, Alitalia, may prove to be Etihad’s biggest challenge to date with the beleaguered Italian flag carrier posting almost a decade of consecutive losses. Fortunately, the Middle Eastern airline already has a track record of successes to draw upon.

“Before our arrival, Air Seychelles was operating at a loss to the tune of €20 million. Following a complete restructure, it made a profit the following year,” states Knight.

Similarly, Etihad’s €560 million investment (part of a larger €1.76 billion investment by existing shareholders and financial institutions) will see it overhaul Alitalia’s fleet, network and business model in an effort to turn its fortunes around.

“Italy has a fabulous inbound– outbound market and Alitalia still has a very strong brand, so following a restructure, the airline can be turned around, become profitable and even begin to thrive,” he enthuses.

Italian renaissance

While preserving the importance of short-haul routes, Etihad’s revitalisation

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The Importance of Abu Dhabi The capital of the United Arab Emirates (UAE), Abu Dhabi’s geography makes it a natural hub to connect mature, expanding and emerging markets and has seen it positioning itself as the crossroads of the Middle East.

Ever more efficient aircraft coupled with a number of technological advances has enabled non-stop access between Abu Dhabi and almost any destination in the world, with Etihad and its partners increasingly augmenting the city’s connectivity.

Indicative of the extraordinary growth the entire region is experiencing, global traffic rates may have grown 5.4% in 2013, but both the Middle East and Abu Dhabi recorded double-digit increases, 11.2% and 12.4% respectively.

Abu Dhabi’s main international airport may face stiff competition from the likes of its equivalents in both Dubai and Qatar’s capital, Doha, but its new Midfield Terminal Complex (part of a wider multi-billion dollar investment programme) will see its capacity grow to 30 million passengers once completed in 2017.

With 20 million expected to use Abu Dhabi International Airport within the next few years, the overall expansion and development of the hub is seen as vital to enable the continued diversification and growth of the emirate’s economy and its airline.

plan to transition Alitalia into a sustainable and profitable airline centres on growing long-haul routes from both Rome Fiumicino and Milan Malpensa.

Due to come into effect this winter, Alitalia will create stronger links with Abu Dhabi by increasing frequency from

Fiumicino and commencing a new daily Malpensa service.

Complementing Etihad’s existing daily services to both airports, additional Abu Dhabi connections are planned from other Italian cities, such as Venice, Catania and Bologna, from summer 2015.

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Etihad Airways

Etihad Airways Partners Etihad has unveiled a new brand that it hopes will bring together “like-minded airlines” in an effort to offer customers more choice through improved networks, schedules and frequent flyer benefits.

Traditionally eschewing joining one of the world’s three airline alliances, SkyTeam, oneworld and Star Alliance, Etihad’s new

partnership would appear to be another example of the carrier forging its own path.

Alongside Etihad, initial participants include Air Berlin, Air Serbia, Air Seychelles, Jet Airways and Darwin Airline – all of which Etihad holds strategic equity investments in, though this may not be surprising considering the

According to Knight, Etihad’s aim is to see Fiumicino emerge as a more significant European intercontinental hub, with up to five new routes launching over the next four years; while long-haul flights from Malpensa are hoped to more than double to 25 weekly flights by 2018.

When announcing the investment, CEO of Etihad Airways, James Hogan, commented that Alitalia was “the perfect ambassador for Italy and all that it represents”. However, he also warned that, ultimately, “it has to work as a business first”.

As with Etihad’s other network partners, its relationship with Alitalia is hoped to bring cost synergies thanks

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programme’s key emphasis is on strong commercial partnerships and shared values.

During the unveiling, Etihad’s CEO commented that Partners differed from legacy airline alliances by offering benefits “well beyond pure commercial co-operation”, mirroring his approach when making strategic equity investments.

to streamlined hub operations; new routes, schedules and flight capacity; joint procurement of aircraft, engines and assets; and the sharing of resources, knowledge and technology.

However, benefits aren’t purely related to the airlines, Knight declares, noting that passengers can take advantage of “greater choice, convenience, stability and reliability”.

In sync

Those behind it claim Etihad’s partnership strategy delivers advantages that go well beyond commercial alliances and that it isn’t something to be feared, a sentiment Knight strongly shares.

Any airline can reportedly become an Etihad Airways Partner, even if it is already part of an existing alliance, such as in the case of oneworld member, Air Berlin.

To date, it hasn’t been confirmed whether or not Aer Lingus, Alitalia or Virgin Australia – all of which Etihad also holds equity investments in – will become future participants.

He makes it clear that “aviation is a business of networks and growing those networks”.

“The airline industry is changing and the future offers an abundance of opportunities,” he concludes. “Our business model may be different, but at the end of the day, a credible business plan delivers consistent growth.”

Having already carried 10.6 million passengers in 2014 (up to September) and with 13 new non-stop routes planned by year-end 2015, plus a spate of capacity increases and an expanding list of partners, Etihad may be the new kid on the block, but its approach is certainly catching the attention of both peers and passengers alike.

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Growth trajectory CEO, Thomas Schnalke, talks to Joe Bates about rising traffic figures, an expanding route network and the growth potential of Düsseldorf Airport.

A

fter an almost uninterrupted decade of passenger growth, a slight 2009 dip in throughput being the only blot on the copybook, Düsseldorf is most definitely an airport on the up.

North Rhine-Westphalia’s gateway to the world handled a record 21.2 million passengers (+2%) last year and shows no sign of slowing down this year, with throughput rising by 3.6% in the first half of 2014.

Its fast-expanding route network, operated by 60 airlines, includes non-stop services to 180 destinations across the globe that encompass 110 weekly long-haul connections to 25 intercontinental destinations.

They include non-stop connections to major hubs such as Abu Dhabi, Dubai, Chicago, New York, Beijing and Tokyo, illustrating the importance of the airport to the region.

Indeed, Düsseldorf’s impressive long-haul network has been built up in a comparatively short period of time, really starting with the 2011 addition of Air China services to Beijing.

Etihad and Air Berlin’s connections to Abu Dhabi followed in 2012, before American Airlines started flying to and from Chicago and All Nippon Airways (ANA) launched services to Tokyo earlier this year.

Both of Germany’s largest airlines, Air Berlin and the Lufthansa Group, use Düsseldorf as a key transfer point, helping ensure its status as Germany’s third biggest gateway for passenger traffic after Frankfurt and Munich.

Its popularity has seen it scoop a host of honours in the last decade that have included a couple of Skytrax awards – ‘Best Regional Airport in Europe’ (2012)

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ROUTES NEWS 7, 2014

We are in constant dialogue with the world’s airlines over how we can optimise our existing route network and develop new connections

and ‘Airport Staff Service Excellence Europe’ (2011) – as well as the ‘Best German Airport in its Category’ prize in the 2006 Business Traveller Awards.

It was also shortlisted for its marketing efforts in this year’s World Routes Marketing Awards for airports in the 20 to 50 million passengers per annum category.

Yet ambitious CEO, Thomas Schnalke, feels that the airport can do even better – if it is allowed to expand its operating hours and end the current slot restrictions that he feels are holding Düsseldorf Airport back.

“Now is the time for us to set the course for the future, and that means giving ourselves as big a competitive advantage as possible as we are in a region saturated with airports,” explains Schnalke.

“North Rhine-Westphalia [NRW] needs a capable air traffic hub that is attractive to the airlines in order to remain economically competitive in the international arena. However, our airport is subject to strict licensing regulations and if we wish to remain a powerful hub for NRW in the future we’ll have to change this by expanding

our slot capacity and having more flexible use of our runways.

“To this end, probably in the spring of 2015, we will apply for a planning permit to change our operational licence.

“In essence, we want to use our existing slot capacity more efficiently to be able to offer the airlines more slots and meet rising demand during the busiest times of the day.

“More specifically, both ourselves and German air traffic control want more flexibility in the daytime use of the existing two-runway system.”

Catchment area

There is certainly no denying that the airport’s location in one of Europe’s most powerful economic regions – NRW is Germany’s biggest market for outbound air travel – ensures that it has a wide and fairly affluent catchment area.

Indeed, around 18 million people live within a 100-kilometre radius of Düsseldorf Airport, which, according to Schnalke, is of huge importance to the population of NRW and southeast Holland.

This appeal has led to it becoming a firm favourite with both leisure and business travellers, although the number

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Düsseldorf Airport

of charter airlines serving Düsseldorf has decreased over the past few years.

Having said that, Germany’s large leisure travel airlines such as Condor, TUIfly, Germania and Sun Express (a joint venture of Lufthansa and Turkish Airlines) continue to have a strong presence in Düsseldorf.

“We are the largest airport in Germany’s biggest state by population,” says Schnalke. “Nearly all of Europe’s major cities can be reached in under 90 minutes’ flying time of Düsseldorf.

What’s not to like?”

In addition to its passenger appeal, the gateway remains a key economic generator for the city and both regional and national economies, directly accounting for some 19,700 jobs.

Route network

Not surprisingly, hub carriers Air Berlin (6.7 million) and Lufthansa/Germanwings (5.9 million) are the biggest airlines at Düsseldorf Airport, accounting for more than half of its passengers.

Former Lufthansa subsidiary and now Thomas Cook Group owned leisure airline

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Condor (901,786), Sun Express (713,511) and TUIfly (656,050) were the next biggest operators at the airport in 2013, and this is unlikely to change in 2014.

The top five routes served from Düsseldorf in 2013 were Munich (1.6 million), Palma de Mallorca (1.08 million), Berlin (1.08 million), London (900,000), and Antalya (865,000).

Schnalke tells Routes News that he is happy with the current route network, although admits that, like most airport bosses, he would like to see a few more long-haul routes added to the list.

“Düsseldorf Airport is NRW’s gateway to the world and as such should be served by global network carriers operating services and onward connections to destinations across the globe,” he states.

“Today, passengers can choose from 110 weekly long-haul flights to 25 intercontinental destinations from Düsseldorf, which has helped us become the third largest airport in Germany and biggest airport in the state of NRW which includes the cities of Cologne, Dortmund and Essen.

“We are, however, in constant dialogue with the world’s airlines over how we can optimise our existing route network and develop new connections.

“With regards to new services, our focus is very much on the launch of direct routes to successful and emerging markets worldwide – especially for longhaul connections that carry significance for our international economic region.

“Economic and tourism hotspots in Asia such as Bangkok; Shanghai; Singapore; Colombo; Hong Kong; Delhi and Mumbai are of great interest to us, for example, as is São Paulo in Brazil, Johannesburg in South Africa and San Francisco in the US.” He adds: “Air Berlin, Lufthansa and their alliance partners use Düsseldorf Airport as a transfer airport. In developing our long-haul flight network, especially to North America and Asia, we partner with them and the three airline alliances represented at the airport – oneworld, Star and Etihad-Equity – as it is the best way to be successful.

“We must be doing something right because besides the established hubs

ROUTES NEWS 7, 2014

21

Düsseldorf Airport

of Frankfurt and Munich we are the only German airport with important intercontinental air traffic and strongly increasing options.”

Infrastructure development

Schnalke refers to Düsseldorf Airport as the “convenient” airport due to the relatively short walking distances faced by passengers, as all three of its concourse-like terminals can be reached from a central terminal in just a few minutes.

Indeed, the customer-friendly layout of the airport makes minimum 35-minute transfer times possible between terminals – something that big airports such as London Heathrow and HartsfieldJackson Atlanta can only dream about!

And Schnalke is quick to point out that this is not entirely down to the airport’s layout, as it has invested more than €300 million on upgrading its facilities in a bid to make it a more operationally effective and customer-friendly hub.

“Two newly constructed passageways between piers A and B, as well as B and C, now guarantee a swift and convenient transfer,” he notes. “We have also built a new aircraft hangar, an additional car

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ROUTES NEWS 7, 2014

park, and an impressive new rental car centre.

“Our next major project, the renovation and expansion of our luggage transfer system, is already underway and includes the construction of a new connection between the baggage sorting halls of piers B and C and new luggage storage facilities.

“This project alone represents a €70 million investment and will ensure that we are better equipped for growing passenger and luggage volumes in the future.”

Environment

Schnalke adds that Düsseldorf is one of Europe’s most environmentally-friendly airports, achieving second-tier ‘Reduction’ level certification in aviation’s Airport Carbon Accreditation programme.

The programme, developed by Airports Council International-Europe, is globally recognised and requires a continued commitment to environmental protection to remain valid.

“We are committed to environmental and climate protection, which we work on continuously,” enthuses Schnalke.

“To that end, we apply various solutions, including block heating stations. We have several photovoltaic plants and save energy and indirectly reduce CO2 emissions by optimising the lighting and air conditioning systems in the terminals.”

Looking to the future

Despite a near decade of traffic increases, Schnalke remains reluctant to make any predictions about future passenger growth.

It would, however, be wrong to assume that his reticence to predict the future is down to any doubts about the upward trajectory of passenger traffic at his airport.

“It is difficult to predict what the future might bring as we have never operated in such a competitive market before and the aviation industry is, of course, subject to many outside influences,” he muses.

“Such conditions make it hard for airports and the industry in general to set the course for a prosperous future.

That said, Düsseldorf Airport is well positioned for it.”

It sounds like Düsseldorf Airport is in safe hands.

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Making the right connections A growing route network, enhanced facilities and a host of customer service innovations ensure that these are exciting times for Montréal-Trudeau, writes Joe Bates.

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he quality of Montréal’s route network has been praised in a new study from SECOR-KPMG which concludes that it corresponds well with the size of the Montréal market.

It says that despite below-average economic growth, Montréal’s air service has greatly improved over the past decade, both in terms of passenger traffic and number of destinations.

The study claims that Montréal can build on its position as a hub between North America and Europe, and increasingly to the Middle East/North Africa, by expanding its connecting traffic.

It argues that the deployment of new and smaller long-haul aircraft, such as the Dreamliner, which lower the minimum traffic level required for some destinations, could make new routes to major cities profitable.

And it suggests that the growing number of major international airline alliances present in Montréal could increase its appeal to foreign airlines.

The findings will come as no surprise to operator, Aéroports de Montréal (ADM), which has quietly gone about expanding Trudeau’s route network over the past few years.

Indeed, this summer, MontréalTrudeau offered direct flights to no fewer than 28 European cities, among them Prague for the first time in several years.

Montréal–Paris remained the bestserved international route outbound from Canada, with up to seven daily flights to

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ROUTES NEWS 7, 2014

Paris. Overall, carriers flying to Europe offered 13% more seats than in 2013.

“Montréal-Trudeau ranks fourth among all North American airports for the number of European destinations served by direct flights, ahead of major hubs like Chicago and Atlanta,” enthuses ADM’s president and CEO, James Cherry.

“We’re proud that Trudeau has become a dynamic hub linking North America and Europe, with connecting traffic showing constant growth.”

Growing role as a hub

With 30 airlines offering direct flights to more than 130 destinations worldwide, Montréal-Trudeau ranks second among Canadian airports for the number of direct destinations and first for international traffic ratio (excluding flights to and from the United States).

ADM is looking to further strengthen the airport’s role as a hub and recently welcomed three new carriers: Turkish Airlines (Istanbul), Syphax (Tunis-Carthage) and Copa Airlines (Panama City).

It believes that with their large networks, between them they will significantly improve Montréal’s connections to several regions of the world, including Eastern Europe, North Africa/Middle East, Central Asia and Latin America.

“The share of international traffic from Montréal-Trudeau has been steadily increasing over the years and now

accounts for nearly 38% of our business,” notes Cherry.

“Our growing role as a hub is reflected by the fact our share of connecting traffic rose to 16% in 2013 and continues to gain altitude.”

Facts and figures

During the period 2004–2013, the total number of passengers at Montréal-Trudeau grew by an annual average of 4.6%, higher than the growth of the province of Québec’s GDP. The international passenger segment showed the strongest growth over the period, with an average annual increase of 9.8%.

Trudeau can also lay claim to being the most ‘international’ of Canada’s major airports, with nearly 40% of its passengers travelling on international flights – the figure rising to 62% with the inclusion of transborder services between the US and Canada.

According to ADM, Montréal is “directly connected in a significant way” to 37 of the world’s 123 most influential cities (classification by the Global World Cities Research Network), including 32 served by at least three flights per week.

The mix makes it possible to reach all 123 cities – with the notable exception of Shenzhen in China – with a direct flight or with just one connection.

ADM admits that, for now, no destination in Asia and South America presents a sufficient level of demand

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Montréal-Trudeau

to justify the establishment of a profitable direct city-pair, with the exception of Beijing.

However, the last attempt to establish a direct link with Beijing failed because of the unavailability of a suitable landing slot at Beijing Capital International Airport.

According to ADM calculations, an international flight has to offer a minimum origin-destination demand of 40,000 passengers a year, and it has no hesitation in stating that routes failing to meet this threshold are “unlikely to be served, unless they are strategically located hubs, as is already the case for Amsterdam Schiphol and Doha”.

Cherry says: “There are opportunities for Montréal-Trudeau in the short, medium and long-terms and we are doing everything necessary to encourage carriers to launch new services in a timely manner.

“However, it is important to note that the launch of a new service is a business decision that is entirely up to the airline

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concerned. It is first and foremost a matter of supply and demand.”

Airport enhancements

To accommodate growth and enhance passenger convenience, Trudeau has established a centralised security checkpoint for domestic and international flights, increasing capacity by 40% and making it the largest security station of its kind at any Canadian airport.

It is also planning a major extension of the airport’s international jetty. Scheduled to open in September 2016, it will feature six new boarding gates to handle more Airbus A380 and Boeing 787Dreamliner aircraft, a large commercial area and a VIP lounge.

Moreover, last spring MontréalTrudeau officially opened 20,000sqft of new commercial zones in its public and international areas, which have boosted both customer satisfaction levels and ADM’s income from non-aeronautical activity.

The zones added ten new restaurants and boutiques to the airport’s already impressive line-up of retail offerings, encompassing gourmet restaurants and popular fast-food outlets, well-known local and international brands, and a wide range of renowned franchises selling cosmetics, clothing, books and music.

“We want our customers’ experience to be as pleasant and memorable as possible and this has been the driving force behind our development strategy,” explains Cherry.

“Boutiques and restaurants have become an integral part of the airport experience and the pleasures of travel, and airports are now striving to set themselves apart by offering distinctive local brands.”

With traffic on the rise – a record 14.1 million passengers (+2.1%) passed through Trudeau last year – and ADM forecasting solid growth in the future, the new, improved facilities will certainly be needed.

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25

Good times and blurred lines ASM’s senior vice president consulting and product development, Nigel Mayes, reviews this year’s global traffic trends.

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hen history looks back at 2014, particularly the first half of the year before the Ebola outbreak, it is likely to be remembered for strong traffic growth, and the big news stories illustrating the increasingly blurred lines between business models.

So much so, in fact, that perhaps airports and airlines should spend more time thinking in terms of brands and products, rather than the traditional labels of low cost carriers (LCC), full service carriers (FSC) and charter airlines.

Good times

The calendar year started well for many carriers, with IATA reporting solid growth

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ROUTES NEWS 7, 2014

in Revenue Passenger Kilometres (RPKs) for the months of April (+7.5%), May (+6.2%) and June (+4.7).

The third quarter should also be strong, based on 5.4% and 5.9% increases in RPKs in July and August, respectively, with any impact of Ebola not expected to be felt until the fourth quarter.

Many carriers posted healthy financial results in the first two quarter of 2014, none more so than in the US where airline consolidation contributed to improved second quarter profits for United, Delta, Southwest and JetBlue.

American’s second quarter profit of $864 million meant that the carrier

was able to provide a dividend to its shareholders for the first time since 1980!

Even the cargo market, which was expected to show very few signs of growth in 2014 after 2013’s disappointing 1.4% upturn in freight tonne kilometres (FTKs), enjoyed a good first half of the year, with FTKs rising by 4.1%, buoyed by increases of 6.1% and 5.1% in July and August, respectively.

The growth reflected the improved economic situation in the first half of the year, although the nervousness in the final quarter will no doubt dampen the out-turn for the fourth quarter.

The 2.9% rise in global seat capacity for September 2014 was driven by rising

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Traffic trends demand to and from the Asian market, which soared by 7.8% with the top five country markets for growth being China, Japan, India, Vietnam and Thailand.

With the notable exception of China, 2014 has seen a rapid increase in low-cost capacity in all of the top five, with city pairs being served by multiple airlines and indicating an inevitable need for consolidation.

In China, the large capacity increases are coming from the established carriers China Southern and Shenzhen Airlines, as well as LCCs like Spring Airlines, which still remain a small proportion of the overall China seat capacity (less than 2%).

Blurred lines

As LCCs continue to drive the growth in Asia, it is interesting to see that some of the big stories for the first half of 2014 show the increasingly blurred lines within the airline industry between LCCs, FSCs and charter carriers.

For instance, the low-cost business model continues to expand into the medium and long-haul markets, with a number of LCCs taking further widebody aircraft into their fleets.

The latest example is the Brazilian LCC, Azul, which announced that it will become the first long-haul, low-cost carrier in the Americas (and seventh such carrier in the world). The carrier is taking six A330-200s and five A350s, and will connect Brazil with the US. Meanwhile, in Europe, Norwegian Air Shuttle continues to develop the low-cost, long-haul network it began in May 2013, recently launching new long-haul services from Copenhagen and Stockholm and inaugurating operations from London Gatwick. It is expected to launch further long-haul opportunities from its other European bases.

Elsewhere, we’ve seen Lufthansa developing two new products targeting the long-haul leisure market: New airline ‘Jump’, which is expected to adopt a hybrid model that is closer to competitor Air Berlin when it launches A340 services from Frankfurt next year; and planned new long-haul, low-cost carrier ‘Wings’.

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Seat capacity by region for a representative week in September for 2014 over 2013 Region

2013

2014

Total

%

159,507

172,004

331,511

7.8%

5,402

5,642

11,044

4.4%

20,042

20,839

40,881

4.0%

157,787

163,518

321,305

3.6%

Middle East

18,533

19,207

37,560

2.7%

South America

35,955

36,740

72,695

2.2%

6,063

6,015

12,078

-0.8%

202,855

200,769

403,624

-1.0%

20,800

20,371

41,171

-2.1%

628,957

646,939

1,272,265

2.9%

Asia Central America Africa Europe

Caribbean North America Australasia Total

Source: Sabre ADI.

Wings is expected to use B767s from Lufthansa’s non-Frankfurt bases, such as Düsseldorf, Cologne and Munich, a development that follows its low-cost brand Germanwings, taking on the short-haul, non-hub services previously served by Lufthansa from all the regional German airports with the exception of Frankfurt and Munich.

In the Asia-Pacific region, investment in LCCs by the FSCs is already common place, with five of the largest network carriers already having an interest in an LCC – Singapore Airlines (Scoot), Thai Airways (Nok Air & Thai Smile), Garuda Indonesia (Citilink), Philippine Airlines (PAL Express – now a regional hybrid carrier) and Vietnam Airlines (Jet Pacific Airlines).

If the blurring between LCCs and FSCs is not happening via ownership, it is being accelerated through LCCs attacking the FSCs on product.

In June of this year, for example, JetBlue began operating a business class service on trans-continental flights, while Ryanair announced it is looking closely at improving its customer service offering in a bid to encourage more business passengers onto its services.

Surely, we will see more of the so-called LCC brands moving into the long-haul arena, and no doubt some of these brands will replace some of the old legacy brands.

Like most industries as markets mature, companies begin to target specific market segments – and the incumbents need to decide which market segments their business model and brand fits.

In the airline industry we tend to segment the business models into FSCs, LCCs and charter, but as the lines blur between these models we may need to focus more on the brands and how they target their consumers, rather than segmenting carriers by type.

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World Routes 2014 • Report Back

3,000 Delegates 270 Airlines World Routes 2014 Co-Hosts

Welcome to Chicago

677 Airports 134 Tourism Authorities 2 Conferences: The World Routes Strategy Summit and The World Routes Tourism Summit 16,000+ Face-to-Face Meetings

êSEPTEMBER 20–23, 2014ê êMcCORMICK PLACE, CHICAGOê

82 Hosted Network Stands

‘The most American of American cities’ proved an ideal location to mark the 20th anniversary of World Routes, with thousands of aviation and tourism delegates joining in with the celebrations.

25,580sqm of Exhibition Floor Space

20 Meeting Chalets

21 Route Exchange Airline Briefings

Watch event coverage online at www.routesonline.com/routes-tv

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World Routes 2014 • Report Back

Critical issues Addressing aviation’s biggest challenges was the source of much debate, taking in airport infrastructure, regulation, profitability, privatisation and sustainability.

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ith two days overflowing with addresses, presentations and panel discussions, a packed audience heard of the many critical issues potentially facing aviation in the year ahead and what was being done to overcome them.

The question of how infrastructure can keep up with growing demand was discussed at length, with speakers concluding that investment was key to an airport remaining competitive and attractive.

Major expansion projects underway at gateways in developing nations across Asia, the Middle East and Latin America were contrasted with traditional destinations such as London and New York, both of which face ongoing problems with capacity.

Whether such improvements should be borne by private or public funding sparked passionate debate, with panelists noting that, though many governments are actively investing in aviation, more needed to show their support in the face of ever-increasing air travel demand.

One moderator, professor Brian Havel, went so far as to warn of the overburden of bureaucracy and “stupid” regulation, declaring, “government must stop meddling in our practices”.

Discussing the hot topic of profitability, Azul’s chief strategy officer, Trey Urbahn, commented that airlines could be profitable if they are disciplined with their costs, but explained that almost 36% of [Azul’s] profits go on taxes alone.

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Urbahn is working with the government to address the issue of taxation, but like many of his peers, he wants to see the duty garnered reinvested in infrastructure developments.

Following the recent air transport tragedies of MH17 and MH370, safety and security were also put under the spotlight.

Speakers highlighted the need for greater levels of transparency from aviation bodies on what is being done to prevent another incident taking place.

Noting that the response hadn’t been what he’d hoped, Malaysia Airports’ managing director, Datuk Badlisham Ghazali, said the industry needed to “move forward in a more visible way”.

The stimulating programme drew to a close with a debate on sustainability in

aviation. Despite the challenges raised, most panelists were rather optimistic about the future of the industry, a sentiment that ran through many of the preceding discussions.

Vice president of environmental affairs at Airlines for America, Nancy Young, highlighted the restructuring of US airlines over the past years and their multi-billion dollar investment in the renewal of their fleets.

The combination of more efficient aircraft and considerably higher load factors demonstrated better management by airlines; however, speakers agreed more needed to be done in the areas of air traffic management, biofuel development and the roll out of Open Skies agreements.

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World Routes 2014 • Report Back

Border patrol US Customs and Border Protection (CBP) plans to double pre-clearance capacity at airports over the next decade.

Speaking during the Strategy Summit, Kevin McAleenan revealed details of the expansion programme, explaining that a “flexible model” bringing security and commercial benefits to host governments would drive the strategy.

Aiming to pre-clear 33% of all USbound passengers by 2024, McAleenan said that the CBP would evaluate and prioritise potential new pre-clearance locations during late 2014, with site visits and negotiations conducted in early 2015.

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“Pre-clearance can bring significant opportunities for commercial projects, passengers and security. Around 25 airports have contacted the CBP about pre-clearance and we are seeing a reduction of up to 50% in waiting times at partner airports,” he noted.

The agency currently permits pre-clearance at 15 locations in Canada, Ireland, UAE, the Bahamas, Aruba and Bermuda, with almost 30% of commercial aircraft and 18% of commercial air travellers arriving into the US pre-cleared last year.

INDUSTRY LEADING LINE-UP OF SPEAKERS, INCLUDING: • Susan Kurland, US Department of Transportation • Sir Tim Clark, Emirates • Scott Kirby, American Airlines • Jim Compton, United Airlines • Thomas Windmuller, IATA • Daniel Scowsill, WTTC • Angela Gittens, ACI World • Dr Sani Şener, TAV Airports Holding • Augustin de Romanet, Aéroports de Paris • Sebastien Mikosz, LOT Polish Airlines • Vijay Poonoosamy, Etihad Airways • John Byerly, US State Department • Matt Cornelius, ACI-North America • Trey Urbahn, Azul • Antonio Miguel Marques, São Paulo-Guarulhos • Matthew Thomas, Vantage Airport Group • Kevin McAleenan, US Customs & Border Protection • Scott Laurence, JetBlue Airways • Vincent Hodder, VivaAerobus • Christian Kley, Airbus Americas • Courtney Miller, Bombardier Commercial Aircraft • Alex Heiter, Boeing Commercial Airplanes • Kevin Toland, Dublin Airport • Fernando Estrada, Vueling Airlines • Christophe Viatte, Airbaltic • Nancy Young, Airlines for America • Jacqueline Drumheller, Alaska Air

ROUTES NEWS 7, 2014

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World Routes 2014 • News

Read all about it!

It was confirmed at World Routes that Bahrain Airport Company would host the first ever Routes Middle East & Africa forum, which will take place next year.

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his inaugural event, from May 31 – June 2, 2015, will see aviation professionals from across the region come together to discuss air service development to, from and within the Middle East and Africa.

BAC’s chief commercial officer, Mohamed Khalil, told Routes News that it was with great anticipation that Bahrain welcomes such a significant conference.

“We are delighted to be bringing this prestigious new event to Bahrain so we can show our visitors first-hand the warm, welcoming culture of our people and experience the efficient and friendly airport which makes this country proud,” Khalil said.

Located in the Arabian Gulf, Bahrain has a history of aviation dating back almost a century. Historically, it has acted

as a gateway between the East and West, providing a natural transit destination for early trade routes and becoming a strategic hub for the Northern Gulf.

“Securing Routes MEA is the result of the collective efforts of our partners and stakeholders and we are confident that this world-class forum will reiterate Bahrain’s role as an aviation hub,” added the CCO. BAC is currently in the design phase of a significant modernisation programmes for Bahrain International Airport, with the construction of new infrastructure due to break ground ahead of next year’s event.

Khalil confirmed that the final detailed designs of a new $900 million terminal will be completed by the end of 2014 and will be operational within a five-year period.

Also included in the major expansion

Routes Asia heads to the Philippines in 2016 Routes Asia would will be making its way to the vibrant capital city of Manila from March 6–8, 2016.

The event will be hosted by the Philippine Department of Tourism, and co-hosted by Manila International Airport Authority along with its stakeholders, Tourism Promotions Board and Mactan-Cebu International Airport Authority.

Noting the rapid growth of the nation’s trade investment and tourism, alongside the numerous opportunities for expanding air routes to major points in Asia and the rest of the world, Philippine Department of Tourism secretary, Ramon Jimenez Jr, enthused: “We are extremely honoured to be given this opportunity, The Philippines is a strong, viable option for staging the largest and most important route development forum in Asia.”

It is hoped that hosting the event will provide an opportunity for the Philippines to increase air services and visitor numbers at a time when expansions to its airport infrastructure offers airlines new opportunities.

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project will be the addition of a general aviation terminal and maintenance, repair and overhaul (MRO) facilities.

Ahead of this, an $80 million refurbishment of Bahrain’s existing terminal is currently underway.

Malaysia Airports’ key role World Routes saw a special presentation made to former Malaysia Airports managing director Tan Sri Bashir Ahmad Abdul Majid, who stepped down from the helm this summer.

Tan Sri Bashir transformed Kuala Lumpur International Airport into a major global aviation hub and has supported the Routes business with the introduction of regional airline forums to complement the annual World Routes event.

Malaysia Airports hosted Routes Asia in Kuala Lumpur between its inauguration in 2003 and 2005 and also hosted World Routes 2008. More recently, it partnered with Ministry of Tourism Sarawak to co-host 2014’s Asia event in Kuching, Sarawak.

“This year marks Routes’ 20th anniversary and Tan Sri Bashir has played a key role in reaching this important milestone, not least for having hosted five Routes events in Malaysia over recent years, and we are incredibly grateful for his support and guidance,” says UBM Live’s director of Routes, Katie Bland. “We look forward to welcoming him to future events.”

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World Routes 2014 • Marketing Awards

Record breaker Brussels Airport’s head of aviation marketing, Léon Verhallen, talks to Jonny Williamson about his gateway’s triumph in the World Routes Marketing Awards for 2014.

Having lifted the Overall Winner Award for the second time in three years, what does the award mean for Brussels Airport and the city?

After winning the award in Abu Dhabi in 2012 and then being recognised as Highly Commended in Las Vegas last year, we simply didn’t believe we would be picking up this prestigious award again in 2014.

It has been a strong year for Brussels Airport and the team have worked hard to ensure we are supporting our airline partners, whether small regional carriers, medium-sized operators or long-haul airlines.

The award emphasises the key role both the airport and Belgium play as not only a European hub, but as a gateway to the continent, so it’s great to have our efforts recognised once again by the international airline community.

What has been your strategy towards air service development?

Air service development includes nurturing and developing your existing client base, as well as intelligently adding new clients to your network.

By intelligently, I mean creating the right proposals for the right airlines while preventing putting your existing client base in danger.

Our network strategy combines the airport’s development as a leading Star Alliance hub in Europe, with Brussels Airlines the key home carrier; the further

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growth of our long-haul links with other alliances and the Gulf; anchoring the main Belgian leisure carriers, Jetairfly and Thomas Cook Airlines to Brussels Airport; and assuring a fair share of the airport in the European full service and low-cost carrier market.

What advice would you offer other airports?

Don’t challenge new business only; make sure your priorities remain with your existing client base. It’s important to remember that marketing today centres on both route development and delivery of traffic.

Successfully welcoming a new airline to the airport is only half the work; the next stop is to jointly secure traffic for the new route.

If you are nominated for a Routes Marketing Award in the future, don’t just submit a text and a funny video. Make sure your submission includes a powerful presentation of your achievements and how you accomplished them.

Having just announced a record summer in terms of passenger traffic, what are your growth plans for 2015 and beyond?

By the end of 2014, Brussels Airport will be close to beating our previous annual record of 21.6 million passengers set in 2000, the year before Sabena, the Belgian national airline, collapsed.

The main difference compared to 2000 is the airport now sees significantly more O&D traffic than transfer travel, thereby guaranteeing a healthy foundation to build further growth on.

Our plans include turning around the new low-fare traffic in 2014 courtesy of Ryanair, Vueling, easyJet and Brussels Airlines to create sustainable and profitable operations for all carriers; developing our long-haul network, particularly in Asia and North America where several key destination still have no connectivity with Brussels; and opening our Connector extension, the new operational and commercial heart of Brussels Airport, at the beginning of 2015.

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World Routes 2014 • Report Back

HONOURS LIST OVERALL WINNER: BRUSSELS AIRPORT

4-20 million passengers

Winner: Brussels Airport Highly commended: Athens and Budapest Shortlisted: • Abu Dhabi Airports • Tampa

Under 4 million passengers

Winner: Shannon Airport Over 50 million passengers

Winner: Changi Airport Group Highly commended: Amsterdam Schiphol and Frankfurt Shortlisted: • Heathrow • Paris Charles de Gaulle

20-50 million passengers

Winner: Dublin Airport Highly commended: Copenhagen and Munich Shortlisted: • Düsseldorf • Seattle-Tacoma

Highly commended: City Airport Bremen Shortlisted: • Aksu • Cuneo Levaldigi • Kilimanjaro

Best destination marketing

Winner: Tourism Australia

Highly commended: Turismo De Tenerife Shortlisted: • Philippines Department of Tourism • Las Vegas Convention & Visitors Authority • Madagascar Tourism Board • Valencia Tourism

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World Routes 2014 • Tourism Summit

The future of travel A distinguished panel of speakers broached topics such as the likes of shifting traveller demand; ensuring efficient passenger flow; rising stars; and what the future may hold.

SPEAKERS INCLUDED:

S

ponsored by Brand USA and chaired by its senior VP for global market development and World Routes veteran, Alfredo Gonzalez, this year’s Tourism Summit got off to a flying start with a discussion on how established and emerging destinations are attracting new visitors.

Visit England’s CEO, James Berresford, offered a view of London as both a blessing and a curse, noting that though the city is one of the world’s strongest brands, the capital has a tendency to overshadow the country’s many other destinations.

“England has so much more to offer but we are viewed as a very Londoncentric nation, especially in terms of flights. That is why we are currently actively pushing alternative or additional routes into the country, such as through Manchester, Birmingham, Bristol or Newcastle,” he said.

Berresford’s comments on visitors’ need for “authenticity” sparked passionate agreement, and the word was echoed in the programme’s subsequent sessions. The consensus was that the modern traveller was rejecting “fabricated experiences”, preferring to connect with “real people in real communities”.

The crucial role social media plays in marketing destinations was raised,

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particularly for those as-yet unestablished locations, alongside the importance of tourism operators, airports and airlines all working together for a unified purpose.

The second session highlighted the arrival of a new breed of savvy traveller, someone who has undertaken a wealth of online research and desires a truly customised package.

The combination of low-cost airlines and the rise of secondary cities is helping to cater for this demand, but as CEO of Visit Cyprus, Angelos Loizou, noted: “Co-operation between tourism authorities and airlines to create the right kind of connectivity is vital.”

With 110 million Chinese nationals predicted to travel abroad by the end of 2014, Dr Adam Wu, chief operating officer of the China Business Network, asked: “People want to travel and technology is helping them to realise their desires, but is the infrastructure in place to fit us all on the plane?

“Technology is speeding growth dramatically, but airports and airlines have to act now to keep up with the demand of the future,” Wu added.

China and India were identified as dynamically growing markets, while technology, particularly the Internet and smartphones, was citied as “revolutionising” the travel industry.

• Alfredo Gonzalez, Brand USA • Don Welsh, Choose Chicago • Ricky Skerritt, Tourism & International Transport for St Kitts and Nevis • James Berresford, Visit England • Rafael Alberto Smith, Punta Cana International Airport • Miguel Angel Perez, Valencia Tourism • Ndabo Khoza, Tourism KwaZulu-Natal • Angelos Loizou, Visit Cyprus • Subhash Goyal, STIC Travel Group • Julie Chase, Austin CVB • Benito Bengzon Jr, Philippines Department of Tourism • Kevin Burke, ACI-North America • Aluizio Margarido, São PauloViracopos International Airport • Amit Rikhy, ADC&HAS Airports Worldwide • Guy Stephenson, London Gatwick Airport • Vernice Walkine, Nassau Airport Development Company • Dr Adam Wu, China Business Network • Peter Cerda, IATA • Helgi Mar Björgvinsson, Icelandair • Stephanie Wear, Tenerife Tourism

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World Routes 2014 • Destination News

Back on top New business strategies and dozens of new routes have helped Chicago O’Hare reclaim its status as the world’s busiest airport for aircraft movements, writes Jonny Williamson.

T

he Chicago Department of Aviation’s approach to growth is described by its commissioner, Rosemarie Andolino, as one focused on increasing service offering; providing a world-class passenger service; investing in and around the airports; and sustainability.

The city now handles 81 million passengers a year through its international gateways, O’Hare and Midway, with 1.4 million tonnes of cargo passing through both.

Andolino told Routes News that 40 new routes have been launched, six new international carriers welcomed and passenger capacity steadily increased since 2013.

The environment has also been at the centre of the Chicago revival, with its Sustainability Airports Manual guiding developments including a number of green concession policies and the world’s first airport aeroponic garden.

Noting the importance of having a long-term strategy regarding development, the commissioner was confident that “through the contacts made during this year’s World Routes, Chicago’s airports will continue to grow in terms of service and choice offered for travellers.”

“My first ever experience of World Routes provided me with the most valuable business-to-business meetings I have ever had. After that, it was not simply a case of having to attend the event, we wanted to host it,” she explained.

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Guest appearance Mayor of Chicago, Rahm Emmanuel, dropped into McCormick Place to take in the sights at World Routes.

A tour around the Networking Village saw the mayor introduced to delegations from Brand USA; Denver International Airport; Emirates Airline; KwaZulu-Natal Province; Incheon Airport; and Bahrain Airport Company, among others.

A visit to the impressive Chicago Host stand allowed him to enjoy aerial photos of both Midway and O’Hare, a Taste of Chicago restaurant, a Brews of Chicago bar and local entertainment, while an impromptu stop at the Chengdu Shuangliu International Airport stand saw him being presented with a toy panda.

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World Routes 2014 • Report Back

CHICAGO FAST FACTS

Automated passport control The Chicago Department of Aviation is reaping the rewards from a $2.2 million investment in automated passport control technology.

Pioneered at Canada’s Vancouver International Airport in June 2013, the self-use equipment removes much of the administration work that previously had to be completed, enabling agents to focus on matters of security.

Significantly reducing processing time for international travellers, O’Hare now has more than 32 self-service kiosks, while a smaller number have been installed at Midway reflecting its lower level of international air services.

Chicago’s US Customs and Border Protection chief, Brian Bell, described the technology as a “game changer”, and noted “what used to take 45 minutes for a returning US citizen is now averaging 12 minutes”.

Plans are already in place to widen the technology’s adoption, with 30 more kiosks intended for O’Hare alongside a pilot programme to review whether allowing passengers to enter data via their smartphones inflight would bring further benefits.

• Over 48 million annual visitors • Home to more than 200 theatres, 200 art galleries and 5,500 restaurants • McCormick Place offers the largest amount of exhibition space in North America (2.6 million square feet)

• T he largest selection of Impressionist paintings outside of Paris, many of them on display in the Art Institute of Chicago • Location of Virgin’s first hotel property, due to open in December 2014 • T he Willis Tower (formerly the Sears Tower) observation platform, the Skydeck, stands 1,353 feet high and is located on the 103rd floor

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World Routes 2014 • Networking

Boogie wonderland Delegates were truly spoilt at this year’s World Routes with a number of unique evenings laid on by the generous hosts.

P

re-event tours afforded attendees the chance to sample some of Chicago’s many attractions and lose themselves in the city’s unique architecture and history.

A behind the scenes tour of O’Hare International Airport; an 18-hole round at Harborside International Golf Center; a city film tour; a city Segway tour and a First Lady river cruise were on offer – and all of them proved popular.

The Saturday Reception, sponsored

by Brand USA and held in the Hyatt Regency Chicago’s Crystal Ballroom, was the perfect setting to catch up with old friends, and make some new ones, ahead of Sunday’s official ribboncutting ceremony.

After a full day of Strategy Summit content and Face-to-Face meetings, Choose Chicago and the Chicago Department of Aviation hosted a

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one-of-a-kind Welcome Reception at the Art Institute of Chicago.

Delegates had the opportunity to take in a private tour of the galleries before making their way to the museum’s Modern Wing where food, drinks and entertainment awaited them.

The Welcome Reception was the talk of the Networking Village come Monday morning, with talk inevitably moving to the upcoming Networking Evening.

Chicago’s Field Museum of Natural History proved to be a memorable venue for a truly spectacular evening.

With Earth, Wind and Fire, natives of the city, providing the soundtrack, delegates sampled dishes from many of Chicago’s world-renowned restaurants, had front-row seats to all the action from the World Routes Marketing Awards and had their evening capped off with a private firework display.

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41

World Routes 2014 • VisitMe Promotions

VisitMe

A number of hosted stands within the networking village offered delegates the opportunity to win prizes during their time at World Routes.

AIRLINE BRIEFINGS Delegates were given the opportunity to gain valuable insight into their target and current airline partner’s future strategy and plans for growth during World Routes.

Representatives from many of the world’s leading carriers delivered presentations, including: • Iberia’s Neil Chernoff, senior vice president of network planning and alliances • Transavia’s Roy Scheerder, chief commercial officer • AirAsia’s Joann Chow, manager of network & fleet • easyJet’s Paul Croft, schedule development manager • Finnair’s Rikke Munk Christensen, head of network planning • Ethiopian Airlines’ Girma Shiferaw, director of alliances & network planning • Thomas Cook Airlines Group’s Eric Oberhuber, head of planning & international relations • Virgin Atlantic Airways’ Robert Bissett, network planning & analysis manager, commercial • Air India’s Surendra Gupte, head of fleet & network planning & international relations • Air Canada’s Frank Satusky, manager of network planning • bmi regional’s Chris Graham, director of revenue & network

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World Routes 2014 • Handover

Africa is ready Next year will see the 21st World Route Development Forum head to Africa for the first time when the event comes to the coastal city of Durban.

JOHANNESBURG

-NATAL KWAZULU-NATAL

SOUTH AFRICA

DURBAN

CAPE TOWN

A

s World Routes 2014 drew to a close, this year’s hosts Chicago Department of Aviation and Choose Chicago officially handed the baton over to the Province of KwaZulu-Natal, South Africa.

Michael Mabuyakhulu, Provincial Minister of Economic Development, Tourism & Environmental Affairs, told Routes News that hosting World Routes in Durban would be an incredible opportunity and experience for KwaZulu-Natal.

“We are the most popular tourism destination for all South Africans and more international visitors are now sampling our attractions every year. Meanwhile, Durban is South Africa’s premier port, handling more than 80 million tonnes of cargo a year, and the region is recognised as the country’s biggest manufacturing hub.”

Many of the region’s key stakeholders have joined forces in support of World Routes 2015, including the KwaZulu-Natal Department of Economic Development, Tourism & Environmental Affairs; Tourism KwaZulu-Natal; Trade & Investment KwaZulu-Natal; Airports Company of South Africa; King Shaka International Airport; Dube TradePort; Durban & KZN Convention Bureau and eThekwini Municipality.

Mabuyakhulu believes that hosting the event will further assist the province in securing more direct air linkages with the rest of the world, which he sees as “essential for

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accelerating the region’s radical economic growth”, especially in the tourism sector.

“We are very fortunate to have leaders who understand that when you pull together, you have a far greater chance at success; that has been the driving force behind our achievements,” he added.

King Shaka International Airport is a brand new multi-billion rand investment that opened in May 2010, just ahead of the FIFA World Cup football tournament. The airport, along with its adjacent industrial development zone, the Dube TradePort, provides world-class multimodal transport and trade logistics that is enhancing the country’s intercontinental passenger travel and freight transfer.

Noting that conservative projections put African growth for the next 20 years at over 5%, he hinted: “We are involved in some very intense negotiations with a number of airlines at the moment and we are hoping to have some new route announcements either before or during World Routes 2015.”

“World Routes is the equivalent of the World Cup of Aviation, so our hosting of the event definitely adds a new dimension to our efforts in developing routes.

“We want delegates to know that we are ready to welcome them: Durban is ready, KwaZulu-Natal is ready and Africa is ready; we look forward to welcoming you next September,” Mabuyakhulu added.

WORLD ROUTES 2015 LOCATION: Durban, South Africa DATES: September 19–22, 2015 VENUE: Inkosi Albert Luthuli International Convention Centre (ICC) HOSTS: Province of KwaZulu-Natal MEETINGS: Three full days of pre-scheduled Face-to-Face Meetings AIRLINE BRIEFINGS: Route Exchange Airline Briefings delivered by senior airline network planners CONFERENCES: Stimulating conference content, including the World Routes Strategy Summit and the World Routes Tourism Summit NETWORKING VILLAGE: 150 exhibitors NETWORKING: Full hospitality programme including Welcome Reception and KwaZulu-Natal Networking Evening

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Events essentials

Sky-high aspirations Now in its eighth year, Routes Americas will make its first appearance in the US next year when it arrives in Denver, Colorado.

even

ts

esse ntial s

MUST SEE ATTRACTIONS: • Downtown Denver • Colorado State Capitol • Denver Art Museum • 16th Street Mall – Pedestrian Mall • Larimer Square • Lower Downtown Historic District

FEBRUARY 1–3, 2015 SHERATON DENVER DOWNTOWN HOTEL

T

he annual gathering of air service decision-makers for all of the Americas, Routes Americas is expected to bring together upwards of 70 airlines, 200 airports and 25 tourism authorities, alongside a number of other industry stakeholders, to discuss all aspects of air service development.

Known as the Mile High City, Denver is the ideal destination for the event, which in 2015 will be hosted by Denver International Airport and supported by Visit Denver.

The city has an iconic skyline located against the stunning backdrop of the Rocky Mountains. Located just 340 miles (547 kilometres) from the exact centre of the continental United States, Denver is closer to the heart of the nation than any of its metropolitan contemporaries.

A vibrant, active city, Denver’s stunning architecture, award-winning

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dining and diverse neighbourhoods are equaled only by its thriving cultural scene, natural beauty and unparalleled views.

Denver International Airport will celebrate its 20th anniversary on February 28, 2015. In addition, its first major expansion since 1995 is currently underway, with a projected completion date sometime in the first half of 2015.

In 2013, the gateway ranked as the third-largest domestic passenger airport in the US, behind only Los Angeles and Las Vegas-McCarran; a feat made even more impressive given that Denver’s metro area population ranks as the country’s 18th largest.

Last year, the airport served 52.6 million passengers, making it the fifth busiest airport in the US and the world’s 15th. Fifteen airlines currently provide non-stop service from Denver

• Denver Museum of Nature & Science • Cherry Creek & Cherry Creek Shopping District • Red Rocks Amphitheatre & Park • Denver Performing Arts Complex • The Blue Bear – Colorado Convention Center to more than 160 domestic destinations and 24 international gateways located in 10 countries.

A significant hub for both Frontier and United Airlines, the airport has also become a focus city for Southwest.

Also served by six foreign flag carriers (namely Aeromexico, Air Canada, British Airways, Icelandair, Lufthansa and Volaris), combined, its six passenger airlines provide nearly 1,600 daily non-stop flights.

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Events essentials

Routes Americas 2015

Denver, Colorado, USA 01-03 February 2015

Routes Europe 2015

Aberdeen, Scotland 12-14 April 2015

Routes Asia 2015

Kunming, Yunnan, China 15-17 March 2015

Routes CIS 2015

Venue TBC Date TBC

Routes Middle East & Africa 2015

The Kingdom of Bahrain 31 May - 2 June 2015

World Routes 2015

Durban, KwaZulu-Natal Province, South Africa

19-22 September 2015

Head of airline relations, Mark Gray, reflects on an unforgettable World Routes and looks ahead to what 2015 holds in store.

MEET THE

TEAM

What are your main responsibilities at Routes?

I lead the airline, scheduling and VIP teams, developing airline attendance and content at the Routes events and online.

My role includes business development and managing existing accounts, while developing new attendance and presence across the Routes brand.

What are your highlights from World Routes’ time in Chicago?

Where to start! Listening to Tim Clark [Emirates, CEO] and Scott Kirby [American Airlines, president] in the Strategy Summit was very interesting; the evening receptions were among the best yet; the quality of the show in general was superb and, of course, getting the chance to experience the city’s amazing restaurants and nightlife.

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How important a milestone is it for World Routes to make its African debut in 2015?

It’s hugely significant for Routes and something that everyone is excited and honoured to be involved in. Durban will stage a fantastic event and the team is looking forward to welcoming the world.

Having provided a memorable end to this year’s World Routes, how excited are you about seeing what next year’s hosts, KwaZulu-Natal Province, has in store for delegates?

I’m lucky enough to have been to Durban on a planning trip, so I know firsthand what a wonderful city and destination awaits the delegates. From the cutting-edge development of Dube TradePort to the culture, beautiful weather, beaches and activities – so much is in store and the vibe will be truly unforgettable!

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p o t e h t m o r f w ie V NAME & JOB TITLE ORGANISATION WEBSITE YEAR FOUNDED

ANDREW HERDMAN Director general Airlines (AAPA) Association of Asia Pacific www.aapairlines.org

HEADQUARTERS

Kuala Lumpur

1966

k ays, Asiana Airlines, Bangko Air Astana, All Nippon Airw air, gon Dra s, ine Airl na Chi , ays Airways, Cathay Pacific Airw laysia Ma Air, ines, Korean uda Indonesia, Japan Airl s, ine MEMBERSHIP Eva Air, Gar Airl ore gap s, Royal Brunei, Sin Airlines, Philippine Airline al Thai Airways Internation

year for Was 2013 a good or bad the region’s airlines? ing It was mostly a year of continu ps kee c trends. Passenger traffi is growing by about 6%; cargo few a for stagnant and has been n Asia years, which is tough for ut abo for carriers which account 40% or ds $1 trillion worth of goo of global air cargo shipments. iness The decline in the cargo bus rement reti or has led to the parking rket ma of many freighters as the lt the resu a As cannot support them. this and n, value of freight has falle those has been very damaging to ment to mit airlines with a heavy com c traffi ger cargo. Although passen last r, -yea continues to rise year-on year saw a drop in yields and rd, average fares across the boa de ma meaning that our airlines on the n dow about $2.5 billion – way esty hon all $5.5 billion of 2012. In and profits are being squeezed, year d goo lly 2010 was the last rea t to tras con k for profits. This is in star king ma are ch many US carriers, whi g good profits and experiencin . ors fact record-breaking load

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fall Does the rise in traffic and too re the t tha te ica ind in yields many airlines in Asia? does The decline in load factors capacity. suggest there is too much capacity You only need a little over to trigger some aggressive ea discounting and that can hav es. significant impact on revenu s in Are there enough airport to ion reg fic aci a-P the Asi meet rising demand?

The short answer is no, and being although new airports are ticular built across the region, in par in countries like China and es The Philippines, in many cas t ren cur The . ugh eno fast t it isn’ in trend of building new airports mple, the The Philippines, for exa ponse is somewhat of a belated res the to an explosion of traffic in re, whe Else t. rke ma c domesti ady Jakarta’s main airport is alre ign des its e twic at ng operati nt is capacity and the governme sector now looking at the private . to build new infrastructure

e/ Is this scenario of privat ly to like ors est inv international ies ntr cou er oth be repeated in ? ion across the reg It already is in Cambodia, The Philippines and many other nts lack countries where governme s, but litie faci new ld the funds to bui re mo are ds nee what the region t the wha dict pre can visionaries who rs yea ten to five in market will look n. the d uire req is time and what projects At the moment a lot of the emental incr vide pro are designed to e they tim the by but improvements, what is of rt sho way get built they fall sia one Ind like es needed. Countri ncing erie exp are ines and The Philipp s, rate wth gro t digi annual doubley the t tha ans me which effectively to six in c traffi ir will double the plan seven years, so both need to extent, e som To io. for such a scenar need the ised ogn rec Indonesia has with y acit cap ort to double its airp and its plans for more terminals pesar, Den Bali at s ject expansion pro dles han ady alre Jakarta – which ai – and more passengers than Dub . other airports

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49

l Can China’s phenomena ent pm airport develo programme continue? ething, If China says it can do som na has Chi it? bt dou who are we to airport on e gam the been ahead of h oug alth e, tim e capacity for som with s blem pro e som they do have military airspace congestion as the will This it. of st still controls mo civil as , rse cou of e, change in tim just and us rmo eno aerospace is in fact keeps on growing. China is est bigg ond already the sec r the domestic aviation market afte wth gro t digi bleUS, and its dou ing down. rates show no sign of slow e to clos tly ren cur is Beijing Capital iest bus ld’s wor becoming the g the airport, but despite openin a few just inal term world’s biggest g out nin run ady alre years ago, it is nt me ern gov the of capacity and to ort airp new a ld needs to bui keep up with demand.

Like elsewhere, such s new phenomenal growth create na is Chi but , rse cou challenges, of when e gam the of ad very much ahe of e aus bec orts it comes to airp ult, they long-term planning. As a res airports lass ld-c wor y have some trul re. mo g and are buildin

stors, as government or private inve us. We for e this is not the core issu t wha ut are only concerned abo the services they provide and the efficiency of these services, services vide incentives offered to pro s. rge cha and how they regulate

Are governments doing s? enough to support airport , not or m the own y Whether the key a e hav y ainl cert governments ning role to play in granting plan re uctu astr infr approval for ating enhancements and co-ordin , user ities hor aut t ren between diffe ure ens to s lder eho stak groups and . orts airp ir the of wth the future gro ut abo d min n ope We have an service ownership of airports and air it be r the whe rs, vide navigation pro

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laysia What is the latest on Ma ich wh , Airlines flight MH370 vanished?

It is still There is nothing new really. of lot a a mystery and there is ht have speculation about what mig the find happened, but until we know. lly rea er Black Box, we will nev g usin on The search for it goes y private contractors with ver ipment, equ sophisticated deep-sea in a dle but it is like finding a nee ’t don still haystack because we To d. she cra know exactly where it w kne we e, put this into perspectiv t fligh nce roughly where Air Fra ago AF447 crashed a few years and , field because of the debris the find to it still took two years

re is a actual tracking of aircraft, the panies lot of talk about satellite com their standing ready to provide future, the be y ma ch whi s, service large but as of today, there are still erage gaps in aviation satellite cov across the globe, although in and countries continue to fill this know it it could be accelerated. We y is possible because a compan llite sate vide pro at ars Inm called industry coverage for the maritime by for free and made its money s. vice ser al ition add ng providi , Transponders on aircraft can and on ed turn be still r, howeve there off by a flick of a switch and is likely to be a reluctance to raft change this due to the airc es that stat ch whi e cipl prin design electrical you should never have an bled system that cannot be disa to ds nee t tha lt fau of e in cas be isolated.

Do you think recent tragic losses of aircraft will put people off flying?

Black Box. safe No, I don’t, because flying is of form st safe the ly uab arg and and transportation in the world, ry What has been the indust y the t tha , rare so are ts acciden t it response to the fact tha the make headline news across mercial is still possible for a com every fly ple peo ion mill e Nin world. t flight to disappear withou and day and billions every year, trace in 2014? going e eas incr will s ber num these lysis Its loss has led to a lot of ana t forward. Statistics show tha raft in about how we can track airc a loss had ry ust ind the ago rs 10 yea t this the future to make sure tha flights. rate of one in every million part cannot happen again. We are million This fell to one in every two sible of an IATA Task Force respon ut one flights, and right now it is abo due to for looking into this and are is ty in every three million. Safe s by make some recommendation flights of ber num The ing. rov imp ething December. ICAO is doing som annum, now exceeds 30 million per level. similar on a governmental [aircraft of which around 10 are lost at ways The industry is also looking lve written off], half of which invo s and of extending the battery live no fatalities.

On the resistance of Black Boxes.

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