Paris Air Forum 2019: Digital or ecological revolution?

On Friday, June 14, the 6th edition of the Paris Air Forum was held as an aperitif to the Paris Air Show, which opens today near Paris.

This edition, placed under the sign of the Data Revolution, could not avoid the environmental issue, at the heart of all debates in France.

Air travel and global warming

Both Augustin de Romanet, Chairman of the ADP Group, and Elisabeth Borne, Minister of Transport, introduced the forum with two ambitious speeches, which refuted the position of “environmental scapegoat that air transport is currently taking”, while air transport consumes 5 times less kerosene per passenger-kilometre than 30 years ago.

The political context of the moment pushes for solutions that seem unrealistic for the minister, who affirms her defense of French air transport as a catalyst for the opening up of territories. The minister also pointed out interestingly that the countries that are the most advanced on these issues, such as the Netherlands and Sweden, are among the states that tax air travel the least in Europe. Hypocrisy when you hold us…

Defense, air and data, how to reconcile these issues?

The Minister of Defense, Florence Parly, recalled the stakes of military transport in France, but, especially, recalled the risks related to technology in the field of Defense. The risks of hackers taking control of military equipment remotely are not negligible, and France must be prepared.

But beyond the cybersecurity risks with potentially disastrous consequences, the management of data in the field of Defense, and their exploitation remains fundamental, and the Minister expects a lot of innovations from France’s industrial partners in this area.

It is in fact the entire French army that must pivot towards technological innovation, while improving the training of troops and ensuring their morale.

Digital technology to enhance the passenger experience

One of the discussions focused on what the passenger really wants. Interesting discussion but very different expectations…

A real shift in digital strategies

The panel discussion confirmed what we have been saying for years on TravelGuys: it is servicing that is now the priority for airlines, and not e-commerce, in the digital strategies of airlines, according to Stéphanie Charlaix, Director of Digital at Air France.

Internet on board, everywhere and free?

The question of Internet on board is crucial, and very dependent on the different markets. Chinese and Asian demand is skyrocketing and is becoming a prerequisite for passengers to book their flight, whereas it is still seen as an additional service in the US and even more so in Europe. Content optimization is on its way by combining data analytics and working with content providers to cache content that will potentially be consumed by passengers during the flight.

Things have changed: if connectivity is expensive in terms of installation, we are also less and less inclined to pay for simple connectivity, while we are more and more inclined to pay for content: so the business model has to be transformed, even if the cost of equipping a device approaches half a million.

The lounge experience, how to adapt?

Of course we have to provide the basics for everyone: relaxation, work, refreshment and quality food.

But given the efforts made by some airports in the facilities offered to all passengers, High Contribution passengers expect more and more innovations, such as the possibility of having their Business meal in the lounge to maximize their rest on board.

Customer service, the number one priority on medium-haul flights

Vueling’s sales director once again insisted on the basic experience: arriving on time, managing contingencies in a professional manner, but above all adjusting the schedule to extend turnaround times.

The investment in these longer turnaround times is unprecedented for a low-cost airline, but essential to secure operational performance.

Personalize the relationship

Tomorrow’s innovations have one main goal: to personalize the intended relationship thanks to the customer knowledge, to push the right information at the right time… By learning about his behaviors.

Air transport in France in denial of market needs

With the presence of Marc Rochet, president of French Bee, no tongue in cheek. Some examples show that it is possible to make money: EasyJet in France, Air Caraïbes, French Bee on long-haul flights.

The increase in fuel prices is an invalid excuse for the participants. These are the organizations that have not been able to change in the legacy airlines. And the medium-haul low-cost wave will continue in France, as in Italy and Spain: Ryanair is coming back to France, and in a big way, taking advantage of the large number of airports that will finance the airline to use their infrastructures. And this is understandable, the profitability is important and the competition weak.

The development of low-cost airlines can only be done and be competitive on a multi-base model, on which EasyJet and Ryanair excel, according to Marc Rochet.

The future of long-haul low-cost airlines challenged by bankruptcies

Build a system to sell cheap tickets, with an acceptable quality of service and make some money… The presence of Norwegian’s Björn Kjos on the panel was surprising, given the airline’s current difficulties.

Despite the difficulties, the CEO of Norwegian does not doubt his strategy: affordable but not crazy prices, very solid hard product and Wifi offered to all, only the slightly too massive investments have shaken, according to Björn.

On the A321LR, views diverge: with a dense configuration in economy class, it is difficult to go to the East Coast safely, perhaps with the XLR… For all of them, this will be a very interesting adjustment variable to manage seasonality by reducing the wings or adding additional frequencies.

The second argument against narrow-body in long-haul is the unavailability of slots in large airports, which argues in favor of using larger modules to optimize this use… This is the pitfall that WOW Air had and that led to its bankruptcy: operating from too many places multiplies the costs.

To optimize the use of aircraft (more than 5,000 hours per year, break-even point), it is necessary not to specialize in one region of the world. It is difficult to fly a plane more than 15 hours a day over the North Atlantic… North-South and East-West diversification is essential.

Consolidation is not really on the agenda for long-haul low-cost carriers: mergers generate very high restructuring costs that are not compatible with these models.

Bottom line

A day of excellent quality, with high level speakers. We will remember the mistrust of the airlines towards the governments which are more and more interventionist but less and less intelligent. We will remember Marc Rochet’s personality, always so funny but also very intelligent, and who has been leading his business in the airline industry for 30 years!

Olivier Delestre-Levai
Olivier Delestre-Levai
Olivier has been into airline blogging since 2010. First a major contributor to the FlyerTalk forum, he created the FlyerPlan website in July 2012, and writes articles with a major echo among airline specialists. He now co-runs the TravelGuys blog with Bertrand, focusing on travel experience and loyalty programs.
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