Etihad - an example of an airline that gets this right

Etihad is an example of an airline that has launched sustainable flights and has been very visible about it.

Pre Covid, there was the “Greenliner”, a 787-Dreamliner optimised for sustainability, in partnership with Boeing.

More recently, Etihad has made a lot out of the environmental credentials of its new A350-1000, running a ‘sustainability 50’ flight to Paris. This marks both 50 years of the UAE and Etihad’s commitment to reach net zero by 2050.

Based on the research we’ve just shown, eye-catching initiatives like this make sense. Let passengers know they are on a ‘sustainable’ flight - the evidence is that it’s likely to increase passenger satisfaction and brand loyalty.

Finally, remember the study we talked about earlier that showed that many travellers care about environmentally friendly travel only until such time that it inconveniences them.

Running a ‘green’ flight, or using sustainable in-flight items doesn’t inconvenience the passenger in any way, instead it adds to the overall experience.

How Going Green Gives Airlines A Competitive Advantage In The Corporate Space

At the recent CAPA Airlines in Transition Summit 2022 in Manchester (UK), the global head of travel for Ernst & Young set out three rules that the company now has regarding corporate travel.

No air travel if there’s a viable rail alternative, no day trips, and a limit on the number of people going to any one event or meeting.

And so, the evidence is that it’s the all important corporate travel market that might ultimately put more sustainability pressure on airlines than consumers.

This is a trend we talked about even before the pandemic, when we identified major investment firms divesting themselves from fossil fuels, and companies like Microsoft putting in place strict internal environmental controls.

The same point was made at Travelport’s ‘Future of Retail’ event in Dubai.

Quoted in Phocuswire, John Bevan, divisional senior vice president of DNATA travel said,

“They (corporates) have huge targets, very fast targets to net zero. They want to know what is the least impact route to go from A to B.”

Meanwhile, quoted in the Points Guy, Dan Rutherford from the ICCT (International Council on Clean Transportation ) compares flying economy with driving a hybrid and flying business with driving an SUV.

Both have some impact, but the impact of the SUV (or flying business) is of course much higher.

And some business travel will inevitably drop off. Before the pandemic, Apple was buying 50 business class seats on United on flights from San Francisco to Shanghai every day.

Especially with China now being a Zero Covid hold-out, that’s clearly stopped. Yet iPhones and iPads continue to be made.

So, a lot of businesses have adapted and found out first hand that they don’t need to travel that much as they used to.

And of course, reducing corporate travel kills two birds with one stone, it lowers costs. At the same time as being a way that a company can show that it is more sustainable.

As a result, writing in Forbes, Ben Baldanza, former CEO of Spirit says that up to 40% of business travel may not return.

Meanwhile corporate travel providers are giving their clients the tools to measure sustainability.

For example, American Express travel issued a press release saying that its Carbon Footprint Dashboard “will also be available to American Express’ global Corporate clients,to help track emissions associated with their employees’ travel and entertainment spend – across air travel, ground transportation, hotel stays, restaurants and retail purchases.”

As a result, you have airlines chasing a smaller corporate market that’s increasingly concerned about sustainability.

Demonstrating as an airline how you can help a company meet its sustainability goals, is one way to get competitive advantage and maintain or even increase your corporate travel market share.

COMMUNICATION IS KEY - AIRLINES MUST COMMUNICATE PROGRESS

From Shashank Nigam, CEO SimpliFlying:

So far we’ve shown that airlines can get a considerable brand benefit from effective communications, where passengers know that their flight is somehow more sustainable.

Unfortunately, some airlines that have made significant progress on sustainability seldom talk about it.

Very few people know that JetBlue Airways carbon-offsets all of its domestic flights, just like Delta Air Lines.

While some like EasyJet do a better job communicating their strategies, airlines are mostly playing defence when it comes to sustainability. That cannot help airlines in the long term

The dangers of undercutting others on sustainability

Finally, airlines that are taking significant measures and communicating them well tend to focus on building a competitive advantage and taking hits at others. They believe that it’s their way or the highway.

According to Wizz Air boss Jozsef Varadi, carbon offsetting is “a bit of a joke”, despite the airline offering it to its customers.

“Just imagine that you fly a crappy old aircraft, you pollute the world like hell, and then you [plant] two trees, and you think you are done?”

Outgoing American Airlines CEO, Doug Parker, has taken a similar stance, taking jabs at competitors. Both Varadi and Parker are taking potshots at their respective competitors – Lufthansa and Delta Air Lines.

Learning from Airbus and Boeing

This kind of banter doesn’t help the industry as it casts doubts in the minds of customers and stakeholders that everyone is greenwashing.

Airlines need to learn from aircraft manufacturers’ messaging around safety. You’ll never hear Boeing and Airbus spar over the safety of their aircraft.

Manufacturers never position safety as a competitive advantage, which ultimately builds trust in all aircraft.

Similarly, airlines need to acknowledge that there are multiple ways to get to netzero, and while the methods may differ, no one is better than the other.

Many airlines have committed to achieving net-zero emissions by 2050 through various methods.

There are immediate measures that range from flying more fuel-efficient aircraft, installing lighter cabin equipment and offering carbon offset options to customers.

And then there are investments airlines are making in future technologies like carbon sequestration, sustainable aviation fuel and exploring new propulsion systems.

These are all valid methods to get to net-zero emissions, and airlines need to recognise that. It may seem confusing to the ordinary traveller, but it will help if the industry starts to communicate coherently without criticising one another’s methods.

Communicating proactively will help shape the consumer perception of the industry.

It will also truly help airlines seeking a competitive advantage in sustainability if they hire a chief sustainability officer.

A senior professional with expertise in assisting organisations to carve a more environmentally secure future, reporting directly to the chief executive or the board, will speak volumes about how serious an airline is about achieving its sustainability vision.

Delta Air Lines did just that in December last year, as it named Pamela Fletcher as its chief sustainability officer. She begins work today and will report directly to chief executive Ed Bastian.

Ultimately, successful implementation of eco-conscious strategies will see carriers achieve higher profits and maintain customers’ trust.

If airlines continue to downplay each others’ efforts and communicate defensively, the industry may face the same fate as cigarettes yesterday and sugar today.

We want to avoid that – after all, the magic of flying truly makes the world a smaller place.