Think about

Getting Creative During a Pandemic

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Getting creative during a pandemic…
• Qantas Scenic Flight “Great Southern Land”
• “Reignite the joy of flying (…) Sightsee iconic destinations
across Australia (…), where there are no border
restrictions.”
• There were 150 seats listed for $787 (economy), $1787
(premium economy) and $3787 (business)
• Sold out within 10 minutes after going on sale

https://www.qantas.com/au/en/promotions/great-southern-land.html

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Getting creative during a pandemic…
• Singapore Airlines – Dine onboard A380
• Cheapest meals are available in the economy class for about
$37 a head, while the most expensive seats in first class cost
approximately $441 each
• Sold out within 30 minutes after going on sale

https://www.singaporeair.com/en_UK/sg/plan-travel/discover-your-sia/restaurant-a380-at-changi/

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Getting creative during a pandemic…
• Passenger planes being converted to Cargo planes
• Examples include converting passenger aircraft by removing
seats or simply covering economy class seats with covers to
carry lightweight cargo such as medical gloves/ surgical masks

Photo credit: Austrian.com

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 Getting creative during a pandemic…

• FIN offering it´s catering in local supermarkets: “Finnish

carrier Finnair will start selling business class airplane food in
supermarkets in a move to keep its catering staff employed and
to offer a taste of the airline experience to those missing flying
in the COVID-19 times.”
• Alaska Air: Offering 2-for-1 deals = Buy 1 get 1 free (only
taxes & Fees)
• One airline was offering unlimited travel for a fixed price until
March 2021
• In November 2020 a carrier ended a deal that allowed one
passenger an entire row of seats for the price of one.
• Turkish Airlines offering 40% discount on international flights

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Impacts caused by the Russian - Ukraine war

• Embargoes with impacts on the whole Aviation Supply

Chain: Raw Material for the Airline industry (Titanium,
Aluminium, etc.) to be sourced in other ROW (South America,
etc. – longer lead times, higher cost of transport, etc.)
• Most carriers no longer permitted to use Russian Airspace:
Impacts especially on carriers such as Finnair and others
operating to/from HEL to Asia (JAL), now forced to use the
Pole-route (certificates for pax)
• OEM Aircraft Manufacturers: Embargoes cut aircraft sales
and deliveries to Russia with immediate effect  writing off
when performing re-sale of A/C as only possible with loss in
revenues

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3. Technological Development & Status
in the Ground Handling Business

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Technological development in Ground Handling

In general: Shift from manual work to automated work

• Airport Facilities (Boarding bridges, Fuelling systems)

• Faster, closer and saver communication between aircraft and

ground

• Bar-coding technologies for baggage and cargo tracing

• Faster loading and unloading through use of ULD
• Baggage reconciliation systems (BRS)
• Central Load Sheet
• Robots & Devices for loading/stowing
• Artificial Intelligence (AI)

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IATA Program: „Simplifying the business“
• Main topics
– E-Ticketing (ET) 100% mid of 2008
– Common Use Self Service (CUSS)
– Bar-Coded Boarding Pass (BCBP)
– Radio Frequency ID (RFID)
– IATA e-Freight in progress

Other initiatives:
– Baggage Identification Chart
– SGHA

• The target is to save in the industry 6.5 bio. US$

(e-ticketing only 3 bio. US$)
• IATA supports this program in different ways
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Check-in mode Development
Check-in mode - Forecast 2004 - 2008

2,500,000,000

2,000,000,000

1,500,000,000

1,000,000,000 Desk (65%)

CUSS (30%)

500,000,000

Desk (20%)
-
Y2004 Y2005 Y2006 Y2007 Y2008 Y2008 +
Full Desk Check-in Airline Dedicated SS CUSS
Home printed BP - No Baggage Home printed BP - Baggage

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 CUSS – Common Use Self Service

Moves from a single Airline kiosk…

… to Airline selection on a single kiosk

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Self Check-In Terminals

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 Barcode Technology

• ATB2/MagStripe Technology is in fierce competition with

– Internet/Home Check-In
– High cost of the “magstripe” because of a monopolistic market
– Typical price for a ATB2 printer 2.500 €
– ATB 1 printer are available for 700 €
• Barcode Technology was delayed because
– Through-Check-In requirements
– Lack of standards – already solved
• 2D Barcode has the same storage capacity as “magstripe”
• Barcode technology is a part of the IATA Initiative “Simplifying
the business”

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Bar Code Technology

• Project calculations highlight savings of minimum 40% on the

investments
• Lower maintenance costs
• Lower costs for boarding passes
• Fit for internet check-in
• Boarding Control via Bar Code reader
• CUSS kiosks – can operate with ATB2 as well as barcode
• Bar Code useful for check-in via mobile phones

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Bar Code Technology

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RFID baggage tag
• Move from barcode baggage tag to RFID baggage tag

• Advantages
– Passengers: better service because of reduced baggage mishandling
– Airlines: Reduction on costs out of mishandling and compensation
– Airports: faster baggage handling
– Handler: higher productivity because of faster “baggage reconciliation”

• IATA: 15% of Bag Tag Barcodes are read incorrect, with RFID reduction to
about 1%

• Slow acceptance because of

– High investment (Reader for sortation and Reconciliation, Software)
– Costs for baggage tags with RFID chip (US$ 0.21 in December 2005)
– Different RFID Regulations in different countries
– Possibly lack of “private sphere”

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IATA e-Freight
• Air cargo is much more complex with additional paperwork
compared to passenger transportation
• Target: Reduction on “Paper” volume
• Advantages:
– Airlines: reduction of costs, higher data quality
– Shipper/Consignee: higher efficiency and reliable
process chain
– Forwarder: higher productivity
– Customs: reduced costs, better processes,
information up-front
• IATA founded Industry Action Group (IAG)
• Biggest challenge: electronic customs declaration because of
lack of international standard
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e-freight

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IATA e-Freight

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IATA baggage tracing after mishandling
• Worldwide standard
• Easy reference
• Fool-proof by using pictures and colours

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IATA Initiatives - Equipment for the Apron

• Towbarless push-back tractor  ease of work, health

• Remote controlled push-back tractor  better sight
• Bulk loading into cargo holds with „Ramp Snake“ 
more ergonomic working positions, health
• Robots for loading/sorting (AMS/CPH)  more
ergonomic working positions, health
• Reduction of equipment costs
–„well fitting“ equipment = cost efficient equipment
–Right volume of equipment
–Utilization
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Baggage Sortation

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Baggage Sortation

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Baggage Sortation

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Baggage Sortation

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 Think about

Differences in GH and the

overall economic setup
between different countries

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Ground Handling at IAD – an example from the U.S.

• Social differences
- No Unions
- No curfew – Dep (e.g. CPA 01:15/ Avianca 03:50)
- A lot of immigrants  integration to society difficult (grouping)
- High Staff turnover on entry Level positions (~20% of staff quit
within 3-6m, another 20% within 12m)

• Financial differences
- Life at the „Existence Minimum“
- Minimum wages only  Airport demands $12, in Virginia $7.25
(JFK minimum wage 2023 at $19, a few years ago $9 (Check-in agent))

- Ramp Agents often have to have 2-3 Jobs in order to make a living
- Some people work 18hrs and more  homeless, no flat/room

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Ground Handling at IAD – an example from the U.S.

• Handling differences
- Check-in systems mainly CUSS from the GH company
- Contracts between GH and Airline have a 60-90 day termination
period  over the last years no airline has terminated the GH, but
the GH has terminated e.g. UPS (nighttime handling = higher wages)

Facts & Figures

- In 2017: 75.000 flights handled with 1.200 employees
- Dominant position of Swissport
- Yet, taking over a bunch of airlines at the time WFS opted out of GH
business Swissport is still strugling  pace too high, no other
companies in competition to „share the market“

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Ground Handling at IAD – an example from the U.S.
GH company Airline Ramp Pax GH company Airline Ramp Pax
Swissport Aer Lingus x x Aerotek Air France x
Aeroflot x x KLM x
Air Canada x x DGS Aeromexico x x
Air China x x Air India x x
Air France x British Airways x Self-handling
ANA x x Cathay Pacific x
Austrian x x Delta x x
Avianca x x Copa x x
Brussels x x Dnata Emirates x
Cathay Pacific x Icelandair x
Etihad x x Ethiopian x Self-handling
Frontier x x
Iceland x Alaska Self-handling Self-handling
KLM x American Self-handling Self-handling
Korean Air x x United Mainline Self-handling Self-handling
Lufthansa x x Southwest Self-handling Self-handling
Porter x x Jetblue Self-handling Self-handling
Qatar x x
Royal Maroc x x Swissport Cargo United Cargo 60% of all flights in IAD
Saudia x x
SAS x x
Suth African x x
Turkish x x
Virgin Atlantic x x
United Express x compiled 23OCT2018

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4. Globalisation

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Three forces are behind the increase in globalisation

Technological
Progress

Changes in Customer Deregulation and

expectations Liberalisation

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Globalisation – Benefits and Risks

Benefits:
• Globalisation as a mean to achieve higher levels of profitability,
productivity and efficiency
• Employees achieve a higher awareness of the company - to be part of
a global player
• Customers can rely on the expertise and the quality of a worldwide
network
• Shareholders benefit from the use of synergies within a global network

Risks:
• Difficult integration of various nationalities, mentalities, cultures and
languages
• Difficulty in efficiently coordinating the network activities
• Loosing clear strategic focus by opportunistic market approaches

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Customers’ demand for single sourcing

• As customers begin to aim for global solutions their requirements and

preferences have changed. Operating on a global basis requires their
provider’s attention also on a global scale

• Focus has to be shifted from single airlines to alliances

• Alliances are looking for one supplier at each airport serving all partner
airlines (Single Sourcing)

• Alliance partners may be limited in the choice of their ground handler

(e.g. Scandinavia)

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Changes in customer expectations

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Networks create substantial synergy potentials

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Internationalisation Strategies

Decision must implement more than just the cost dimension

• Necessity of high or low coordination of the company elements

• Centralisation versus decentralisation (e.g. organisation of the

company)

• Individualisation versus standardisation (e.g. products, services,

processes, Marketing strategies)

• Election of appropriate business system (subsidiary, joint-venture,

cooperation, franchising, etc.)

• Strategies concerning ownership (majority / minority)

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5. Success Factors like

Key Account Management and

Quality/Safety Management

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Success factor Key Account Management

Functions and goals

 Intensifying and taking care of customer-relationships

 Focusing on Key Accounts (Key Customers)
 Generation of tools and processes for the customers and customer groups
 Define Long-term partnerships with Key Customers

What are Key Accounts ?

 Dependence of partly turnover of the Key Accounts to the entire

turnover of the company
 20-80 rule: 20% of the customers generate 80% of the turnover
 Next to quantitative relevance, image, reference or technological
potentials are important

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Success factor Key Account Management

Centralised versus decentralised KAM

 Centralised KA-Management
- Central office
- Long decision making processes
- Focus is on maximisation of the group profit
- Short-term market tendencies are difficult to meet and specific
customer needs are difficult to satisfy
 Decentralised KA-Management
- Decentralised profit centres
- Focus is on profit maximisation of a single company/ location
- Target of group are not taken into consideration

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Success factor Key Account Management

One Face to the Customer / One Stop Shopping

 Benefits
- All company units are represented by one department to the
customer (one-face-to-the-customer)
- One manager can sell all services at all airports
- Customer has one specific person to turn to
- Only Key Accounts
- Regional customer still handled by local profit centre
- Target: Development of stable long-term relationships with the top
customers

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Quality and Safety Management

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Success factor Global Quality Management

• Important determent for cost-and-time-aspects

• Direct relation to the customer satisfaction
• Many companies generate Quality-management systems
(e.g. implementation of Quality-management systems
through DIN ISO 9000ff or Total Quality Management
(TQM))
• To meet customer needs
• To safe internal costs
• To meet time schedules
• To expand market share

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Operational Key Performance Indicators (KPI)

• Operational data
– Number of handled flights/passengers
– Tons of handled cargo import/export
• Aircraft Damage
– Number and reasons of damages
• Customer Complaints
• Delays – Delay Codes
• Passenger Arrival Services (first bag – last bag on belt)
• Passenger Services (counter opening/ closing, queuing
passengers)
• Ramp Handling
• Environment (Oil/gas consumption)

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Delay Codes 1

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Delay Codes - 2

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Success factor Global Quality Management

Module 2: Carriers
What do you want from your Handling
Company?
Module 1: Staff
Preparational Meeting

Module 3: Staff
Can they achieve what you
are asking for?

Module 5: Ground Handler

Tips on the implementation process to Module 4: Carriers
the Management Receive offer for standards /
agreement

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AHS 1000 check sheet in practice

RAMP SERVICES DEPARTURE FLIGHT:

DATE: Fulfilled
Y N
1 STD - 120 min.
2 STD - 60 min.
3 STD - 60 min.
4
5
6
7 ETD - 10 min.
8

Comments: Checked by:

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KPI in Practice: Fibag/Labag Minutes
20
19
18
17
16
15
14
13
12
11
10
9
8
7
6
5
4
3
2
1
0
May

Average
February
January

July
March

April

June

August

November
October

December
September
First bag GGF Last bag GGF First bag Competitor Last bag Competitor

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 KPI in Practice: Queing Times Minutes
15
14
13
12
11 C-class
10 M-class
9
8 Charter
7
6
5
4
3
2
1
0
May
February
January

July
April
March

August

October

November
June

December
September

Average
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Re-Cap from 26.10.2022 – pages 94 – 142

How to weather a pandemic – how Airlines reacted, new business models, etc.
IATA Simplifying business Initiatives: e-freight, RFID Baggage Tag, e-Ticketing, SGHA,
ISAGO, etc.  importance of such initiatives
Role of IATA, member airlines
Technological Development in GH
Check-in Development
Equipment Development for the Apron - reasons behind, benefits
General relation and impacts of the Market participants and changes to the industry
Ground Handling Market in other ROW  Differences/Specialities, Employees,
Unions, Contract Duration/Termination, Airport size, Customer base, Services
provided/required, etc.
Globalisation, main drivers for globalisation (Customer Expectations, Technology,
Deregulation/Liberalisation), Pros & Cons

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Re-Cap from 26.10.2022 – pages 94 - 142

Internationalization Strategies (Growing a global network) – Organisation De-/Central,

Products Individual./Stand.; Business System Franchise, JV; Ownership Min./Maj.,
Success Factors for a GH company – KAM, Safety Management, Quality (KPIs)
Customer expectations towards a GH company
Single Sourcing – requested from whom, benefits for whom, role of Alliances
Key Account Management – what is it all about, Advantages, aims, different kinds
(centralised / de-centralised  Pros/Cons), Definition of KA
GH with a Network: Synergies (Operational, Cost, Strategic, Revenues)
Quality Management (QMS)  Customer Satisfaction, DIN ISO qualification,
reputation, saving cost, State of the Art, Fulfilling Schedule in time/quality, Market Share
Safety Management (SMS)  Key element in Aviation, staff, equipment, processes
KPIs  which ones are there, what can one derive from figures  Forecasting,
Actions

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