ETIHAD COMES out SWINGING Etihad Airways ”Always Had a Life Beyond Airberlin and Alitalia“ CEO Peter Baumgartner, Reminds Critics

Vol. 25 No. 1 February 2018 orientaviation.com

ETIHAD COMES OUT SWINGING Etihad Airways ”always had a life beyond airberlin and Alitalia“ CEO Peter Baumgartner, reminds critics

JAL announces Records topple as Putting glamour major leadership Asia’s carriers go back into the transition ultra long haul cockpit REPORT INDUSTRY INSIGHT Singapore:league top of Asia’s aerospace GEARED FOR THE FUTURE. TRANSFORMING AVIATION TODAY.

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Client: Pratt & Whitney One Company Ad Title: GFT/PurePower - Go Beyond Publication: Orient Aviation - November Trim: 202 x 273 mm • Bleed: 212 x 283 mm • Live: 182 x 253 mm CONTENTS Volume 25, Issue 1

COVER STORY 20 ETIHAD COMES OUT PUBLISHED BY

ORIENT AVIATION MEDIA GROUP SWINGING Mailing address: GPO Box 11435 Hong Kong CEO Peter Baumgartner Office: “bullish about 2018” 17/F Hang Wai Commercial Building, 231-233 Queen’s Road East, Wanchai, Hong Kong Tel: Editorial (852) 2865 1013 E-mail: [email protected] Website: www.orientaviation.com

Publisher & Editor-in-Chief Christine McGee E-mail: [email protected]

Chief Correspondent Tom Ballantyne Tel: (612) 9638 6895 Fax: (612) 9684 2776 E-mail: [email protected] Greater China Correspondent COMMENT CARGO Dominic Lalk Tel: (852) 2865 1013 5 Challenges ahead for Airbus 29 Drones to be heavy lifters for future air cargo E-mail: [email protected] 30 Alibaba tests unmanned aerial vehicle package

North Asia Correspondent ADDENDUM delivery Geoffrey Tudor 6 Japan Airlines appoints new president in Tel: (813) 3373 8368 E-mail: [email protected] leadership transition INDUSTRY ADDENDUM 6 Blow for Boeing after proposed U.S. duties of 31 Lufthansa Technic Logistik Services building India Correspondent R. Thomas 300% on Bombardier aircraft nullified digital warehouse Tel: (852) 2865 1013 7 Former Suparna Airlines chairman moved to HK 31 Hong Kong Airlines buys into Hong Kong-based E-mail: [email protected] Express as CEO SIA Engineering joint venture Photographers 7 One more aircraft lessor hangs out its shingle in 31 ADB Safegate to upgrade Seoul Incheon airport Rob Finlayson, Graham Uden, Ryan Peters Hong Kong operations 7 Qantas chooses Olivia Wirth to succeed loyalty 31 AAR announces partnership with inflight’s Viasat Chief Designer Chan Ping Kwan boss, Jayne Hrdlicka 32 SR Technics Malaysia receives China air 7 ANA HOLDINGS Inc. chairman, Shinichiro Ito, to worthiness certificate Printing Printing Station(2008) receive his 2017 Orient Aviation Person of the 32 UK technical training group authorized for Gulf Year award before an invitation only audience operations ADMINISTRATION in Tokyo. 32 China controlled lessor, CDB Aviation, reports General Manager robust 2017 results Shirley Ho E-mail: [email protected] NEWS BACKGROUNDERS 8 Indebted Air India group preparing for sell-off INDUSTRY INSIGHT REPORT ADVERTISING 10 IATA campaigns against new tourism taxes in 34 Singapore: Top of Asia’s Aerospace league

Asia-Pacific, Europe & Middle East Japan and New Zealand Clive Richardson 12 Records to topple as Asian carriers go ultra long Tel: (44) 7501 185257 E-mail: [email protected] haul

The Americas / Canada Barnes Media Associates MAIN STORY Ray Barnes 15 Winning ways at Airbus and Boeing Tel: (1 434) 770 4108 Fax: (1 434) 927 5101 E-mail: [email protected] 34 Rolls-Royce launches IntelligentEngine at [email protected] Singapore Air Show 35 Airbus’s Hangar in the Cloud Follow us on Twitter @orientaviation 36 Boeing develops its AnalytX solution also - keep up with the news of the week with Orient Aviation’s Week in 37 Honeywell’s connected aircraft attracts Asia- the Asia-Pacific Pacific customers

© All rights reserved 38 Singapore Airlines fosters future digital Wilson Press HK Ltd., TRAINING champions Hong Kong, 2017 26 Bringing glamour back to the cockpit 38 ‘Kris’ bot in action at Singapore Airlines

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Challenges ahead for Airbus

Saved by the bell. Or at least by Emirates Airline. Only Enders, 59. The Airbus group chief executive has days after retiring Airbus Commercial Aircraft chief announced he will leave Airbus when his current operating officer customers, John Leahy, publicly contract expires in April next year. And then there is admitted the A380 production line could close unless Bombardier. a customer like Emirates did not buy more of the very When all the legal hurdles are cleared for Airbus’s large planes, the two parties made it across the line 50.01% purchase of Bombardier’s C Series jet with a $16 billion order for 20 of the type plus 16 program, the Toulouse manufacturer must prepare options. In return, Emirates won a commitment from for a Boeing challenge to its Canadian 100-120 seat Airbus to keep the A380 production line open for a airliner investment, including some form of partnership minimum of 10 years. between Seattle and Embraer. Closing down the A380 line would have been Elsewhere, China, Japan and China and Russia in a massive blow to Airbus as its proceeds through partnership are intent on taking market share from a management transition that has resulted in the Airbus with their home grown airliners. China’s COMAC resignation of chief operating officer and president of alone has an order book of 600 plus for its mid-size Airbus’ commercial aircraft division, Fabrice Bregier, 56, C919 aircraft and is working on a larger airliner. and the pending retirement of sales chief, John Leahy. These are just some of the challenges ahead for Bregier’s successor is Guillaume Faury, 49, previously the new leaders of Airbus. The industry spotlight the chief executive of Airbus Helicopters. never moves far from Airbus or Boeing, but with such Eric Schulz, from Rolls-Royce civil aerospace, a significant management shift ahead in Toulouse, is stepping into the very large shoes of Leahy as the Airbus strategy and products will be under even greater commercial aircraft arm’s chief of sales. scrutiny at both airlines and at its manufacturing The search also is on for a replacement for Tom competitors in the next 12 months. ■

TOM BALLANTYNE Chief Correspondent Orient Aviation Media Group

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FEBRUARY 2018 / ORIENT AVIATION / 5 ADDENDUM

Japan Airlines announces major leadership transition

Yoshiharu Ueki (65), the former pilot credited with leading Japan Airlines’ recovery from bankruptcy, is to move up to company chairman, following the announcement that current chairman, Masaru Onishi, will remain on the group’s board but will relinquish the chairmanship. Ueki’s successor at JAL is managing executive officer engineering and maintenance, Yuji Akasaka (56). The leadership changes will come into effect on April 1 and are subject to to the next generation before my our business with the intent of ANA’s rapid and nimble response shareholder approval at the energy became empty and that securing solid profitability, and not to JAL’s weakened financial and company’s annual general came this year,” he said. aimlessly pursue scale,” Akasaka operating conditions during the meeting in June. Akasaka joined JAL in told Reuters. carrier’s period of bankruptcy Ueki, who was the 2013 1987, the year the carrier was The new president will have included winning crucial slots at Orient Aviation Person of the privatized, and has held a number the tough task of clawing back Tokyo Haneda airport, achieving Year, said at a press conference in of senior engineering posts and market share from ascendant rival, higher customer ratings than JAL Tokyo last month that he had set the position of vice president All Nippon Airways (ANA), which and expanding its international a six year presidential term as his corporate safety and security. overtook JAL as Japan’s largest network, particularly to North goal. “I wanted to pass the baton “I want to continue developing international airline in 2016. America. ■

Blow to Boeing as C Series 300% duty nullified

In a decision that surprised the deal could only have been anti-dumping or countervailing The Canadian government many in the industry, the U.S. possible because the Canadian duty orders will be issued,” it has made a significant International Trade Commission government was subsidising said. investment in Bombardier’s (USITC) announced on January the Montreal-headquartered The ruling made void aerospace development, 26 that it had voted unanimously company. the 299.45% tariff the U.S. including a US$280 million in favour of Bombardier in In a very public blow to the Department of Commerce had top up injection from a a dispute with Boeing over U.S. Commerce Department, imposed on Bombardier last government aerospace and subsidies for the Canadian the USITC said: “Today it was October as a result of Delta’s transport investment fund. From manufacturer’s new C Series jet. determined that a U.S industry order for the Canadian aircraft. 2013, Bombardier has been At press time, Boeing had yet to is not materially injured or Boeing said in a statement proceeding through a painful announce if it would take its case threatened with material injury it was disappointed by the restructuring of its aerospace to the U.S. courts. by reason of imports of 100 decision because “it did not and rail businesses that resulted Boeing had argued its to 150 seat large civil aircraft recognize the harm Boeing has in massive job losses across the business was harmed when from Canada that the the U.S. suffered from billions of dollars group. Delta Airlines received Department of Commerce has in illegal government subsidies”. Despite leaner operations, unrealistically low prices for its determined as subsidized and It added it would continue to Bombardier, and in particular the order of 75 C Series jets, with sold at less than fair value. record situations that damaged C Series program, has struggled options for 50 more, in 2016. “As a result of the USTIC’s its business through illegal when projected orders for the jet The global aerospace group said negative determinations, no dumping and illegal subsidies. failed to materalise in the last 18 months. In October last year, Airbus announced it would acquire 50.01% of the Bombardier C Series program and said it would move production of the 100-plus seat jet to the Airbus production facility in Mobile in Alabama. ■

6 / ORIENT AVIATION / FEBRUARY 2018 ADDENDUM

HK Express adds new CEO to Lessor Aergo Capital management team hangs out shingle in Hong Kong Former chairman of HNA- executive of HNA Group sister controlled Suparna Airlines Co. company, Africa World Airlines, Dewey Yee, a key player in the Ltd, Luo Cheng, is the new CEO before he moved to Suparna launch of Hong Kong’s fast of low-cost carrier, HK Express. Airlines in Shanghai. developing aircraft leasing The Hong Kong LCC said Luo Suparna Airlines began sector, will head the newly would work with its executive life as Yangtze River Express at opened Hong Kong office of chairman, Zhong Guosong, and Hongqiao airport in Shanghai Dublin headquartered Aergo recently appointed president, in 2003. At the time, the HNA Capital. As Aergo vice chairman Li Dianchun, on strategy, Group owned 85% of the cargo and managing director of Aergo operations, customer service carrier. The airline’s ownership Capital Asia Limited, Yee and and flight operations at the was restructured in 2006 when his team will tap into growing airline. HK Express also is 49% of its shares were sold, demand for leased aircraft since Hong Kong passed into majority-owned by the HNA including a 25% holding to China and related financial products law a range of new tax incentives Group. Airlines. across the region, a business that benefit the aircraft leasing Luo has spent two decades With the changed name of that has acquired added allure sector. ■ in aviation, including a period in Yangtze River Airlines, the carrier Ghana as co-chairman and chief expanded its operations to passenger services in mid-2015 Orient Aviation Person of the Year 2017 and launched its first passenger flight, between Sanya on ANA Holdings chairman, Shinichiro Ito, will receive his Orient Hainan Island and Shanghai, in Aviation Person of the Year 2017 award at an invitation only December of the same year. dinner and presentation at The Ritz Carlton, Tokyo. Ito is the The airline now operates first person in the history of the award to have received it twice. both domestic and international This tribute to him tops a remarkable year for ANA and the services from Shanghai Pudong parent group, including new daily Narita-Los Angeles route and and also from a smaller hub flights to Mexico City. in Xian. It was rebranded as Suparna Airlines in July last year and remains part of the HNA Group. ■

Olivia Wirth to succeed Jayne Hrdlicka at Qantas Loyalty

Qantas has recruited from years and has very successfully its senior executive team to led the Qantas brand, including replace Qantas Loyalty boss, managing the marketing function Jayne Hrdlicka. The former Bain for the frequent flyer program,” consultant and recent head of said Qantas group CEO, Alan Jetstar announced her resignation Joyce. from the group last December “It’s a business she The award honors Ito for his outstanding leadership after she accepted the position understands well and that will at All Nippon Airways and then the parent company, ANA of CEO at Australasian diary benefit from her strong consumer HOLDNGS Inc. in every area of operations from customer company, the A2 Milk Company. analytics and marketing service to fleet innovation, global partnerships, visionary The new CEO of Qantas experience as this part of our network expansion and outstanding management. Loyalty is Olivia Wirth, the portfolio keeps expanding.” All Nippon Airways is a five star SKYTRAX Airline that was group’s Chief Customer Officer, Executive manager of sales and named “Best Airline Staff in Asia and World’s Best Airport who has responsibility for brand, distribution, Vanessa Hudson, is Services [for an airline] in 2017. ■

marketing and corporate affairs. the new group Chief Customer Sponsored by “Olivia has been on the group Officer. Both appointments will management committee for eight take effect on February 12. ■

FEBRUARY 2018 / ORIENT AVIATION / 7 NEWS BACKGROUNDER

Indebted Air India in sell-off

By chief correspondent, Tom Ballantyne

ebt-ridden Indian airline group, Air India, will be restructured as four separate businesses Dwith the intention of selling up to 51% of each of the new entities by year end, the government owners have announced. The core airline businesses of Air India (AI) and low-cost carrier, Air India Express, will be offered as one company but the ground handling, MRO and regional domestic units will be the country’s largest airline by strategy of investing in foreign environment to compete sold separately. passenger numbers. Owned by carriers. The airline owns 24% of effectively,” an IATA Asia-Pacific In a move intended to InterGlobal Aviation, it has gone India’s Jet Airways. spokesman said. achieve a sale, the Indian prime on the record as “interested” New Delhi’s decision to India’s Minister of State minister, Narendra Modi, in the international business allow foreign airline investment for Civil Aviation, Jayant Sinha, announced that foreign airlines of AI and Air India Express. in AI was welcomed by said most public sector airlines, could buy up to 49% of the flag Commentators believed IndiGo most commentators. It was including Lufthansa, British carrier. Previously, they could may invite a foreign partner to announced not long after Airways and Qantas Airways, invest in domestic Indian airlines join it in a bid for the carriers. India’s Parliamentary Standing have been disinvested by their but not Air India. The rules of Qatar Airways is a possible Committee on Transport, governments. “They are now sale, to date, require that Air India candidate for the joint venture Tourism and Culture released actually private sector airlines retains management control. as it already has expressed an a report that concluded the because the private sector However, media reports have said interest in investing in IndiGo. government should review its can run airlines far better than the government would be happy Qatar bought 9.61% of decision to privatize or disinvest governments can run them. It is with 26% of the group if and Cathay Pacific Airways from the airline group and explore why we are going through the when it is sold. Kingboard Chemical Holdings the possibility of “an alternative strategic disinvestment process With estimated debts of late last year. It also controls to disinvestment of our national with Air India,” he said. US$8.5 billion, buying into the 20.01% of the International carrier which is our national Investor interest in AI was flag carrier appears to be a Airlines Group (IAG), 49% of pride”. The report wanted the being publicly sought at press risky venture. It has been widely Meridiana and 10% of Latam. sell-off delayed for five years, a time, when the government was speculated that Singapore Turkey’s Celebi Aviation Holdings recommendation the government expected to release the group’s Airlines (SIA) could be a suitor, also publicly said it had an interest chose to ignore. core and non-core debts and but the airline has only said it is in buying some of Air India’s The International Air assets. “keeping options open” on AI businesses. Transport Association (IATA) said Sinha said last month disinvestment. The two other “Big Three” India’s amended Foreign Direct that local investors will retain The SIA group has an Indian Gulf carriers are unlikely to Investment (FDI) policy was a step management control of the based joint venture, full service be attracted to AI. Emirates in the right direction. “It removes airline and that the Indian carrier Vistara, in partnership Airline president, Sir Tim Clark, the exemption that had been government would add most of with gigantic conglomerate, Tata. has focused the Dubai-based prevalent in the policy which was the AI debt to its own balance Vistara chief executive, Leslie airline on organic growth. At related to a single airline. At the sheet. A special purpose vehicle Thng, said the airline’s backers the Emirate’s biennial air show same time, it is important the will hold the unsustainable debt have an open mind about AI. last November, Etihad Airways government ensured airlines in of the airline and the government Another contender is CEO, Peter Baumgartner, said his India have the most conducive is making “every effort” to Indian LCC, IndiGo, which is Abu Dhabi carrier had ceased its operating and regulatory protect employees, he said. ■

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IATA fights new tourism taxes in Japan and New Zealand

By chief correspondent, Tom Ballantyne

roposed new taxes Such exemptions cannot be on airline passengers ICAO rules on tourism tax income automated when tickets are in Japan and New purchased. It would be an Zealand have provoked A Signatory nation to the Convention on International Civil administrative burden, a cost Aviation (Chicago Convention) and a Contracting State of the a sharp response and a nightmare if airlines had International Civil Aviation Organisation (ICAO) is obliged to from the International Air to process the tax manually. The P adhere to: Transport Association (IATA). It * Article 15 of the Convention which states that no fees, dues practical approach is for the argued the additional charges or other charges shall be imposed by any contracting States in authorities to collect the tax on contradicted the International Civil respect solely of the right of transit over or entry into or exit from arrival or departure so applicable Aviation Organization’s (ICAO) its territory of an aircraft of a contracting State or persons or exemptions are granted international policies on taxation. property thereon. accurately,” IATA said. New Zealand has proposed * Policies on Taxation in the Field of International Air Transport, Following a reported plan a tourism tax on international contained in ICAO Document 86321, states that each Contracting for a tourism tax in Japan, IATA visitors, a plan IATA has asked State shall reduce to the fullest practicable extent and make plans said: “Improved airline services to eliminate all forms of taxation on the sale or use of international to be reconsidered. In Japan, and the availability of attractive transport by air, including taxes on gross receipts of operators and where the introduction of a air fares to the travelling public taxes levied directly on passengers or shippers. Tourism and/or Solidarity Tax have been important factors. is being discussed by Japanese By assisting in the development authorities, IATA has prepared a Data compiled by the World airline industry. It is a policy IATA of tourism and foreign trade, position paper arguing against Travel and Tourism Council follows. “We strongly oppose airlines can make an important implementation of the tax. revealed New Zealand’s travel any form of tax or fee where contribution to the local “Making air travel more and tourism sector contributed the resulting revenue is not economy. expensive by charging a tourism 17.5% to the country’s GDP and reinvested in aviation services “As the economic benefits tax could reduce international generated more than 580,000 or infrastructure. This tax clearly from tourism accrue to the passengers to New Zealand by jobs. By 2027, revenue from increases general government wider economy, levying a 78,000 annually. It would have a tourism is forecast to produce revenue,” the global airline discriminatory tourism tax NZ$100 million (US$70.2 million) 18.2% of GDP and create association said. on an enabling sector like negative impact on the country’s 712,000 jobs. “The potential IATA said if the government aviation is an ineffective and GDP and result in the loss of increase in GDP and jobs is put did introduce the New Zealand ill-conceived policy choice. 1,200 jobs,” IATA’s Regional at risk by the proposed tourism tax, it should take direct Government funding of tourism Director for Member and tax,” he said. responsibility for its collection. and tourism-related initiatives External Relations, and Airport, ICAO does not support the “The proposed tax calls for New should be achieved through Passenger, Cargo and Security, collection of airline sourced taxes Zealand citizens and residents less distortionary means such as Asia Pacific, Vinoop Goel, said. if they are not invested in the to be exempt from the tax. general government revenue.” ■

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Records topple as Asian carriers go ultra long haul

By chief correspondent, Tom Ballantyne

hen Qantas Group CEO, Alan Joyce, challenged Airbus and WBoeing last year to produce an aircraft that could to fly non-stop between Sydney and London, a distance of 16,991 kilometres, it was not a Blue Sky chat -and aircraft manufacturers were listening. Airlines already are breaching distance barriers with the new crop of twin jets, the Airbus A350 and the Boeing B787. These technologically advanced aircraft will reduce the tyranny of distance for Australasian and Tasman carriers and are forecast to erode the dominance of big hub airports in the region. Qantas will launch its direct Perth-London flights in March with its new B787-9. It will be a journey that will save passengers three hours and one stop transit procedures. It is expected the nonstop flight of 14,498 kilometres will take 17 hours. Last October, Singapore Airlines (SIA) launched direct services to San Francisco, a new A350-1000. Singapore-New York. It flew the increase the range of the A350 journey of 13,593km that could Qatar Airways presently route previously but terminated and 777X family of aircraft to take between 14.5 hours to 17.5 holds the record for the longest it in 2013. complete “the last frontier” of hours depending on seasonal commercial airline flight, with its The A350 has a maximum commercial flying by 2022. factors. Cathay Pacific will soon 14,535 kilometre Doha-Auckland range of 15,000 kilometres and In a speech at the Royal enter the fray with nonstop route. But it is a record that the B787 14,140 kilometres. Aeronautical Society in London flights to Washington DC’s Dulles won’t last long. Airbus and Airbus is working on extending last year, Joyce said both International Airport, which will Boeing are developing new the range of the A350. Boeing’s manufacturers had reacted connect Hong Kong to the U.S. aircraft, to be available in the B777X is expected to be able positively to his challenge, but capital for the first time. It will be next five years, which will fly to fly up to 16,110 kilometres the ability to fly the aircraft on the longest flight in the carrier’s longer distances. SIA intends nonstop. offer with a full commercial load network, a 13,122 km route, and to use a longer-range version Qantas’ Joyce has publicly had yet to be achieved. will be operated by the airline’s of the A350 to fly nonstop challenged manufacturers to An aircraft configured with

12 / ORIENT AVIATION / FEBRUARY 2018 NEWS BACKGROUNDER

300 seats would provide Qantas going to do the Sydney-London listened. Much like Hong Kong, aircraft to do it in a commercially with the highest possible revenue mission. We are very comfortable Washington DC is a vibrant and viable fashion. and fleet flexibility, Joyce said. with that and we will continue to dynamic destination. We are “This is another example “Aircraft can do it today, both work with Qantas to meet their thrilled to soon be providing the of how we strive to meet the B777 and the A350, but we requirements,” Grant said. only direct flights between these and exceed our customers’ believe they can’t do it with a full For Asian hubs such as two great cities,” he said. expectations by remaining at the payload,” he said. “More work Hong Kong and Singapore, the “Establishing direct air forefront of product and service is needed on both aircraft to get increasing number of long-haul links to destinations not already innovation in our industry. It will there.” Earlier last year, Joyce said flights that overfly their airports served from Hong Kong further strengthen the Singapore the airline would evaluate the is a threat. As a consequence, SIA enhances our city’s status as hub by providing the fastest and A350 and 777X for 12 months and Cathay are tapping into new Asia’s largest international hub most convenient air connectivity before issuing a formal tender, direct markets. Cathay Pacific and allows us to secure new and between North America and with the number of aircraft CEO, Rupert Hogg, said the important sources of revenue.” Southeast Asia,” he said. SIA ordered still to be decided. new service to Washington DC It is understood Cathay is is the launch customer for the Airbus vice president for the would cater to greater demand looking at other non-stop ultra- ultra-long-range variant of the Pacific, Iain Grant, appeared to for travel to the capital region long routes, including Miami and A350 aircraft. squash industry speculation the of the U.S. It also would provide Mexico City, destinations from The carrier has placed firm European manufacturer may U.S.-based passengers with Hong Kong that are not yet in orders for 63 A350s. Seven will revive the smaller A350-800, more convenient access to key reach. be upgraded to A350-900ULRs. which had been put on ice destinations in Asia and beyond With its A350-900ULRs It has options to purchase 20 after poor sales. Grant said at a through the airline’s home in beginning to arrive this year, SIA more aircraft and four of them recent media briefing that talks Hong Kong. CEO, Goh Choon Phong, said will be converted into firm A350- with Qantas were about the “Our customers have told us customers had asked the carrier 900 orders. This will increase A350-900ULR. “We are bringing they want greater options and to re-start non-stop U.S. flights SIA’s firm orders for A350s to 67 in our A350-900ULR, which is increased flexibility and we have and that Airbus was the right as of September last year. ■

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WINNING WAYS Structural shifts in both ownership and senior management at Airbus and Boeing herald a consolidation in the aircraft industry that had not been anticipated. Chief correspondent, Tom Ballantyne, reports on the possible impact of Airbus’s recent investment in Bombardier, its Emirates A380 deal and Boeing’s interest in Embraer.

nly days before his retirement, Airbus chief Emirates, I think there is no choice but to shut down the operating officer customers, John Leahy, and program,” he said. “I am hopeful we will work out a deal his team signed a deal the manufacturer had [with Emirates] and that others can add airplanes on top of been chasing for months – a Memorandum that. “Emirates is probably the only one with the ability in of Understanding (MoU) for 36 more A380s the market place to take a minimum of six [A380s] a year for Owith the aircraft’s biggest customer, Emirates Airline. up eight to 10 years. And we can add some on top of that.” Soon to retire Leahy had made it plain the program was The MoU for the A380s, announced on January 18, is a in jeopardy. He said the company would have “no choice” commitment for 20 A380s with 16 options, at list prices of but to stop producing the plane if it could not work out a US$16 billion. Deliveries will commence in 2020. deal with Emirates Airline for more A380s. “This new order underscores Airbus’ commitment to “Quite honestly, if we can’t work out a deal with produce the A380 at least for another ten years. I am

FEBRUARY 2018 / ORIENT AVIATION / 15 MAIN STORY

personally convinced more orders could be quite another matter. will follow Emirates’ example and Our goal is a step-change Employees at the Embraer’s that this great aircraft will be built improvement in supply chain main production campus at Sao well into the 2030s,” Leahy said at Jose dos Campos oppose the the announcement in Dubai. management to support Boeing’s Boeing offer out of fear that the During the Dubai Air Show aspiration to be a global purchase would risk the jobs of last November, Emirates industrial champion. Its design 16,000 Embraer employees in president, Sir Tim Clark, said an Brazil. A380 deal with Airbus was “very focuses on improving strategy Embraer was privatized in much down to them. I think the development, procurement 1994, but the Brazilian ownership here [at Emirates] is government has retained a Golden concerned about continuation of processes, contracting and Share in the company that gives it the A380”. fulfillment operations, in addition a veto over any transaction that “They need some to streamlining bureaucracy would transfer control of the copper-plated guarantees that if former state-owned business to a we buy some more, then the line that impacts on Boeing teams new owner. will be continued for a minimum and suppliers. Boeing’s supply Brazilian President, Michael period of ten years. They are fully chain accounts for 65% of the Temer, said the government aware of the consequences of welcomed new investment in cancellation and leaving us high cost of every airplane Embraer, but would not permit a and dry.” change in control of the company. Elsewhere in the group Airbus has expanded customer Another issue hindering a Boeing deal is Embraer’s choice for its aircraft with a planned majority purchase of strong ties with the country’s military establishment. People Bombardier’s C Series jet program. In October, the Toulouse familiar with the matter said Boeing would have to agree to manufacturer announced it would acquire 50.01% of the safeguard Embraer’s defence unit. In response, Boeing has Canadian commercial jet program, subject to regulatory and said the deals it has written in Australia and Britain show it government approvals, in a deal that involved zero up-front could operate defense businesses without compromising cash from Airbus and provided it with a multi-billion dollar, military strategy. ready-to-fly regional jet pretty much for free. According to sources, representatives from both Several thousand miles away, Boeing reacted to Airbus’s companies and Brazil’s government are exploring defense part acquisition of Bombardier with the news, in late protections that would give Boeing full access to Embraer’s December, that it had approached Embraer about buying product lineup. into the Brazilian aircraft manufacturer. Boeing also is pledging to retain the Embraer brand and It was reported in the week leading to Christmas that to include the Brazilian company’s engineers on programs the two companies had agreed to terms of sale that valued such as the potential jetliner, known as the “new mid-market Embraer at US$28 per share. Clinching the deal, however, airplane”.

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appointed chief executive of Airbus China. In his role as country head, he is responsible for all Airbus commercial aircraft activities and for leading the company’s helicopter, defence and space businesses on the Mainland. Enders said in his retirement statement Airbus needed “fresh minds for the 2020s” and that he would use the remainder of his time to ensure a smooth transition to strengthen the company’s ethics and compliance programs. Authorities in Britain and France are investigating alleged fraud and bribery related to Airbus use of outside consultants for commercial aircraft sales, with the company warning that the investigations could lead to “significant penalties”. It has promised to stop working with middlemen. Austria is also investigating suspected fraud in the government’s purchase of Airbus combat aircraft. The governments of France and Germany, both with holdings in Airbus, are paying close attention to the management changes and the progress of the legal investigations. “We obviously need to keep an eye on our strategic interests and (Airbus) governance, which must be exemplary,” said French president, Emmanuel Macron. Speaking in Brussels alongside German Chancellor, Angela Merkel, Macron insisted the two governments would not “interfere politically to return to a role in the daily management of the company”, but added he wanted the Airbus board to provide clarification about the executive shakeup. BNDESpar, the Brazilian Boeing would not be drawn on details of its supply chain state development bank’s investment arm, is restructuring, but said it would represent a “step-change among Embraer’s largest shareholders, with 5.4% in equity. improvement” to supply chain management. “Just as we Other investors include state-controlled banks Banco do work with suppliers to improve their operations, we also are Brasil SA and Caixa Economica Federal SA. taking action within Boeing to improve performance and At the same time, Boeing is planning a major efficiency,” a company spokesman said. reorganization of its critical supply chain that will Amidst all of these changes, the good news is that the consolidate four departments into one supplier management market for commercial jets continues to boom. Last month, group. Like the restructuring of many components of Airbus announced it had delivered 718 aircraft to 85 Airbus’s manufacturing divisions, the changes will add up to customers in 2017, more than 4% higher than the 688 a new era in commercial jet innovation and production at airplanes delivered a year earlier. It received 1,109 net orders Boeing. from 44 customers, which produced a revised backlog to In Toulouse, a management transition that commenced December 31 of 7,265 aircraft, valued at more than $1 when Leahy announced last June that he would retire in trillion. early 2018, continues. Airbus chief operating officer and Boeing topped Airbus in deliveries for the year with 763 president Airbus Commercial Aircraft, Fabrice Bregier, 56, aircraft accepted by customers for the 12 months. It also steps down this month. He will be succeeded by Guillaume reported a record order backlog. With the Asia-Pacific Faury, previously the chief executive of Airbus Helicopters. market on track to become the biggest growth market for Airbus group chief executive, Tom Enders, 59, has jets, one in every four Boeing aircraft, including one in every announced he will depart the group at the end of his current three B787s, was delivered to customers in China, Boeing contract, in April 2019. Plans to identify a successor to Commercial Airplanes vice president marketing, Randy Enders are underway. Former president of civil aerospace at Tinseth, said. Rolls-Royce, Eric Schulz, has taken over from long-serving “It’s a market that is underserved by any calculation. We Leahy. are not talking about a couple of planes, but hundreds of In China, the president of Airbus Commercial Aircraft airplanes,” he said. China is the largest market for the B787, China, Eric Chen, has moved up to chairman of Airbus where 20% of all B787 flights are to, from or around China. China following the retirement of Laurence Barron. Some 40% of Boeing’s record 5,864 airplane backlog, which George Xu, who was chairman of the board of the represents about seven years of production, is from Airbus Tianjin A320 Family Final Assembly Line has been Asia-Pacific customers.■

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Last year was not pretty for Etihad Airways, but CEO, Peter Baumgartner, says the carrier’s critics should not judge its performance solely on the collapse of two of the group’s airline equity partners. Chief correspondent, Tom Ballantyne, reports.

tihad Airways Swiss-born CEO, Peter Baumgartner, major Etihad shareholder, the Abu Dhabi government, was wants to make one point very clear to both unhappy with its airline equity investments and wanted to detractors and supporters. The collapse of Etihad ditch the entire strategy. Aviation Group investments, airberlin and Alitalia, Baumgartner told Orient Aviation he was always was not the end of the world for the Abu Dhabi troubled when journalists reported Etihad had “pulled Eheadquartered airline group. Nor was its 2016 year $1.87 the plug” on its strategy of buying equity in other carriers. billion loss, reported in a delayed announcement mid last year, “With airberlin, we have been very supportive of the airline he told Orient Aviation last month. and of the management over a long period of time, but “There was always a life beyond airberlin and Alitalia. It when there is no hope, at some point you have to take the is important to understand and differentiate. Our financial consequences,” he said. figures for 2016 were not pretty, but when they are analysed “Alitalia was slightly different. Again, we were ready you can see they were primarily driven through impairment to support the management and the board and had that related to structural things that happened,” he said. recommended an approved business plan. In the end, it was The huge loss was heavily influenced by one-off down to staff voting against the plan that kind of pulled the impairments that included $1 billion on aircraft and $808 plug.” million in exposure to Alitalia and airberlin, “but that was Baumgartner also wants to downplay reports that Etihad not illustrative of the operational performance of Etihad was going through a huge strategic review. After almost 15 Airways”, he said. years since the launch of Etihad in November 2003, he said “We had an OK year operationally in 2016, very much it was appropriate to go through its five and ten-year business impacted with like everyone else in the industry, if not more, plans to make sure the airline was positioned for the future. by overcapacity, but we weathered the storm quite well Reviewing strategy is not the result of recent events, he said, relative to our peer group. In 2017, we certainly delivered in but a natural and ongoing part of the business. line with our expectations and I am very bullish about 2018. As for its other investments – in India’s Jet Airways, Air That’s the reality of Etihad Airways. It should not be blurred Serbia and Virgin Australia – they will be maintained, he by our investment challenges.” said. Virgin Australia has not been making much money, Baumgartner joined Etihad in 2005 and took charge but Baumgartner said it remains extremely important. of the airline in May 2016 after James Hogan, the architect “Virgin Australia is the feeder of our ultra-long-haul of the ambitious foreign airlines strategy, moved up to chief Australian network and is commercially executive of the overall Etihad group. Hogan formally extremely important,” he said. departed from the company last year amidst headlines the “The comprehensive network we offer

20 / ORIENT AVIATION / FEBRUARY 2018 COVER STORY

to our customers across Australia is an important part of partnership. We make sure we can take advantage of the full filling our long-haul capacity. So commercially it is a very potential on both sides. It’s a very happy marriage.” important partnership for the airline. Baumgartner made another point to Orient Aviation. “Jet Airways also is successful. The Indian subcontinent “It is important to understand we have more partners than has vast growth potential that has started to deliver very, very just our investment or equity partners. We have around 50 strongly. It is an enormous, growing travel market. We are code-share partners and many of them involve very tight, offering, together, with Jet Airways, the most comprehensive close commercial co-operation. They are highly successful network in and out of India. and making a major contribution to our revenue. You don’t “It is a strategic opportunity that arrived at the right time need to have an equity investment to have a well-performing for us. It is a highly successful and very carefully managed commercial relationship with another airline,” he said. “Equity investment allows you to go beyond certain areas of course, but these partnerships are continuing and our portfolio is expanding in the sense of how closely we work with some of the key airlines in that code-share portfolio. Code-shares are expanded and optimized to our mutual needs. This very successful model is not changing.” Renowned for its service levels and, given its short life, its record as the fastest growing airline in commercial aviation history, its fleet orders are always industry headliners. But now there is a hiatus in fleet acquisitions – and for a reason. The airline ordered 200 aircraft, worth some $52 billion, with Boeing and Airbus in 2013 to cover its requirements going forward. Today, it has a fleet of 119 aircraft with 172

In 2017 we certainly delivered in line with our expectations and I am very bullish for 2018. That’s the reality of Etihad Airways. It should not be blurred by our investment challenges

Peter Baumgartner Etihad Airways CEO

FEBRUARY 2018 / ORIENT AVIATION / 21 COVER STORY

on firm order: 58 B787s, 25 B777s, 62 A350s and 26 A320s. The operational fleet is made up of A319s, A320s, A321s, A380s, B777-200LR, B777-300ER and B787-9s. Its cargo fleet is five A330-200Fs (stored) and six B777Fs. Like most airlines, Etihad has been suffering a yield decline. Baumgartner described the last 12 months as “very intense” for the entire industry, but especially in the Gulf, given the economic climate and the contraction of the oil-based economies of the region. “It had an impact on the traffic mix, especially in 2016 Fragmenting American and the first half of 2017. For us, as airlines, as hub carriers, partnership “sad” you can compensate declining local demand with flow A persistent and major irritant for Etihad are the attacks traffic, but that had an impact on our route economics,” he by the “Big Three” U.S. carriers on Gulf carrier funding said. sources. American Airlines, Delta Air Lines and United “The so-called point-to-point traffic, or the direct flights Airlines have jointly alleged the Middle East carriers are between Abu Dhabi and the destination and vice-versa, is heavily subsidized and should therefore have their access the higher yielding traffic. The more content you lose in the to the U.S. curtailed. mix, the higher the impact on your economics. That was The sustained U.S. campaign recently resulted in something that certainly put us under pressure along with an American’s cancellatin of its long-established code share accelerating over-capacity situation which we saw.” agreement with Etihad. Airlines everywhere have introduced much more rational “This is a situation that makes me a bit sad because we had established a highly successful commercial and responsible capacity planning, he said. “Capacity growth relationship with American over many years. A lot of time in 2017 was flat and 2018 is also flat. That will certainly and effort was put in to reach a stage where we could help us get back to a better place in terms of commercial use each other’s networks to provide very meaningful efficiency,” he said. incremental revenue contributions,” he said. Etihad has experienced a turnaround in yields from “American’s decision was politically driven and mid last year. “It is driven by two factors. Yield is always a certainly did not have any commercial rationale. It is function of fare levels and fare levels came down dramatically indeed sad that this feud had to reach a level such as this. in past years. The trend accelerated in 2016 because of a We are foregoing a commercial relationship that not only stronger than usual over-capacity situation,” he said. boosts the airlines, but also the people, the catchment area “When you have an overcapacity situation, airlines chase and businesses in an economy such as Dallas.” Etihad is withdrawing its flights to Dallas in March. market share through price and fare levels go down. What Baumgartner said the route was unsustainable without has augmented this is a traffic mix impact. When you have the code-share. He believed American’s argument that more flow traffic as a percentage of the total traffic that you pulling out of the code share was good for American jobs carry, the local content is missing. and the American economy did not make sense. “I think “You compensate that by taking more connecting it is exactly the opposite,” he said. travelers and connecting travelers come at a lower yield and Etihad points to independent research by Oxford that leads to a drop in fare levels. But from mid-2017, we saw Economics that showed Etihad contributed $3.8 billion to a very, very encouraging turnaround at Etihad in fare levels. the U.S. economy, supported more than 30,000 American It was market and industry driven.” jobs and brought 280,000 additional visitors to the U.S. Elsewhere, Etihad is one of many airlines that must in 2016. These visitors, who travelled from growing markets historically ignored by U.S. carriers and partners, deal with the trend towards ultra long haul routes that can contributed a further $1.9 billion to the U.S. economy overfly the Gulf hubs. Is it something that concerned Etihad, and supported an additional 22,000 American jobs. which relies a great deal on through hub traffic. “Networks “The support that we see right across major American are always adjusted in line with the technical capabilities companies and institutions, partners, aviation players and of aircraft, demand and developments of markets,” airlines in support of Open Skies is encouraging. I truly Baumgartner said. hope we can quickly find a solution to the dispute because “Ultra long haul flying enabled by the latest aircraft further loss of commercial value that has been established technology is as much an opportunity for us as something is certainly not good for anyone.” He said it shouldn’t be that might impact our hub. To be honest, in our part of the forgotten that Middle Eastern airlines buy Boeing aircraft world when you look at existing traffic streams and emerging and other aviation related goods from U.S. companies. “Such as Sabre, with whom we have a major technology traffic streams, the upside for us as a hub carrier is immense. deal, or B/E Aerospace who produce a lot of our on-board “When you look at South America, Southeast Asia, the material. So, again, I hope this feud can be concluded to Asia-Pacific, China, Africa, the Indian sub-continent, every the benefit of everybody participating in aviation and year there are millions of citizens who reach the disposable bilateral relations as quickly as possible because the risk is income threshold that allows them to travel. There is there that further value gets destroyed,” Baumgartner said. enormous growth potential right at our doorstep, all crossing

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over our part of the world.” The Etihad CEO added the carrier’s presence in the Asia- Adapting to customer Pacific was an essential part of that. “Many of the world’s emerging traffic streams have originated in the Asia-Pacific expectations and of course you want to be an important player. Our hub Swiss-born Peter Baumgartner was appointed Chief geographically is ideally positioned to serve that market and Executive Officer of Etihad Airways in May 2016. He we have good coverage today,” he said. has overall responsibility for the airline’s strategic and He was not ready to reveal new network plans but said operational functions of global sales, marketing, guest experience, network and revenue management, Etihad expansion in the region is on the cards. “It is something very Cargo, digital strategy and innovation, flight and airport much on our radar. We certainly always will have a big foot operations, corporate and aviation security and national in the door,” he said. pilot development. He leads a staff of more than 14,000 Baumgartner further explained: “From route economics employees in 121 countries. and network economics perspectives, reasonable point-to- Before his appointment as Etihad CEO, he was the point content relative to flow traffic is critical. It links directly carrier’s chief commercial officer for nine years. He was to our commitment to make a very direct contribution to the guiding force behind the airline’s award-winning brand Abu Dhabi’s economic opportunities and tourism. We want and customer strategy, including its loyalty programme, to bring people to our destination from destinations around Etihad Guest, which has redefined traditional customer the world,” he said. service and relationship management with its emphasis on intuitively understanding and fulfilling customer “That is a huge focus for us. We want to be a strong expectations. player in emerging flow traffic opportunities but again in Baumgartner has held a number of senior roles in Swiss a very, very balanced way so that at all times we have an and Belgian aviation where he specialized in marketing economically sensible traffic mix. This is not about becoming communications, strategic sales planning and development the biggest business, it’s about becoming the optimal airline and customer relationship management. in support of Abu Dhabi’s vision.” Also high on the list of the carrier’s priorities is new technology. Baumgartner said technology disruption is closer and closer to customers in a travelling sense,” he said. happening in the product development distribution space “After gaining a reputation as an innovator when it and that “for too long the aviation industry has had three comes to hard product, when it comes to seat product, when basic products in the shop: First, Business, Economy it comes to lounges, when it comes to services like chefs and and maybe a little bit of Premium Economy. That’s not nannies on board, our focus has shifted towards technology. good enough to serve a global audience with individual A lot of that influences the way we can deliver product requirements”, he said. and services in a more efficient way and also in a more cost “As an industry we struggle to cope with changing efficient way for our business. That is a major, major focus and emerging requirements, but also with differentiating for us.” requirements across an audience by using legacy technology. Baumgartner said: “There is a lot you can expect from us New technology really helps us to step up to the game. when it comes to empowering a customer. It’s being able to Human behavior and human expectations have changed. bundle a product that is truly customized and personalized We have to customize products and develop the ability to get for each traveler’s individual requirements.” ■

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ALS_Orient-Aviation_2018.01_273x202mm_v.02_DRAFT.indd 1 15.01.18 22:26 TRAINING

Restoring glamour to the cockpit

Efforts to produce sufficient numbers of pilots to crew the fast expanding global airline fleet are being prioritized by the International Civil Aviation Organization (ICAO), reports chief correspondent, Tom Ballantyne.

65% of all airliners flying within the next decade. On average, an airline requires 10 pilots per s warnings increase Speaking at the recent ICAO regional aircraft, 11 pilots per about future inaugural Next Generation of narrow body and 16 for every cockpit crew Aviation Professionals (NGAP) Attracting wide body flying in their fleets. shortages, the Global Summit in Montreal, millenials from Boeing has calculated that secretary general of which was attended by more tech firms the global industry will need Athe International Civil Aviation than 500 education and air • Greater regional invest- 637,000 new pilots in the next Organization (ICAO), Dr. Fang transport leaders, the ICAO ment in pilot training two decades, or 80 new pilots Liu, said the organization would leader said: “By 2036, some infrastructure so more a day in an industry valued at support efforts to recruit “the 620,000 pilots will be needed domestic talent can be $15 billion. Global simulator best and brightest” candidates across our global network and developed manufacturer and flight training to crew and maintain the world’s no less than 80% of these • Technologically advanced company, Canada’s CAE, said the airline fleet. aviators will be new pilots not courses to reduce time in industry would require 90,000 flying today.” she said. graduating cadet pilots new pilots by 2027 before • Attracting more women to “A similar story is playing expanding at an accelerated rate commercial aircraft flying out with air traffic controllers, in the next decade. cabin crew, maintenance The ICAO push for personnel and other skilled year, a contribution that has standardized high quality training technicians.” She called for established air transport as a to increase pilot output comes new global civil aviation, veritable economic lifeline for at a time when several carriers in education and research many cities, states and regions. emerging markets are struggling partnerships to develop The ICAO Secretary General to fully man their fleets. In solutions “to global aviation wants to develop partnerships Vietnam, one of the region’s challenges”. between ICAO and education fastest growing aviation markets, ICAO’s Liu said modern and research institutions that Jetstar Pacific chief operating aircraft carry more than half “begin instilling greater aviation officer, Leslie Stephens, said of the 1.4 billion tourists who awareness at high school and the pilot shortage “is probably travel across international among younger students, the most limiting growth factor borders each especially in young girls”. we are all going to see moving Young graduates attracted forward”. to aviation in the past now The budget subsidiary of see other careers such as Vietnam Airlines and Qantas can Information technology (IT) as second pilots from its parent more attractive, especially in carriers to fill gaps in cockpit terms of salaries, she said. ICAO rosters, but it still has to counter said the Asia-Pacific alone would crew poaching by other carriers, need 230,000 pilots by 2030, including local rival, privately- with a particular requirement for owned LCC, VietJet. narrow body cockpit crew. Vietnam Airlines, which has It is forecast that the single a goal of a total cockpit crew aisle aircraft fleet will make up made up of 80% Vietnamese

26 / ORIENT AVIATION / FEBRUARY 2018 nationals had only achieved airlines. They have given to cope with,” he said. $295,000 at Fuzhou Airlines. a 49% presence by year end recruiters from the U.S. to New Global advertisements for At the opposite end of the 2017. “That’s how difficult it is Zealand financial carte blanche to B737 captains to fly Chinese training spectrum, flight schools to get Vietnamese pilots,” said find them well qualified cockpit domestic carriers are offering and academies across the region Stephens. crew. starting salaries of $400,000 per have been graduating increasing South Korean airlines have Pilot union officials in year. B737 captains flying with numbers of young commercial lost dozens of pilots to Chinese Australia have reported Qantas earn about $235,000. pilots. carriers that offer more money Chinese airlines are offering the Captains flying the same aircraft There are multiple reasons and benefits than South Korean country’s domestic pilots salaries type at Virgin Australia, and for the gaps in supply of pilots airlines. The average salary of Australian carriers cannot match. Tigerair and Jetstar, receive to airlines, but in 2018, two a Korean Air (KAL) pilot is one Australian and International Pilot $180,000 and $157,000 per main factors contributing to third of a senior Chinese airline Association president, Capt. annum, respectively. healthy pilot demand are: large pilot. In 2016, after a protracted Murray Butt, said B737 training Foreign pilots flying B737s on numbers of baby boomer pilots dispute, 140 pilots resigned from captains can earn upwards of the Mainland are said to receive are approaching retirement age, KAL. Chinese carriers recruited US$600,000 a year in China. annual salaries of approximately usually at 65. Their departure 40 of them. “That is going to be difficult for $325,000 at Suprana Airlines, from the industry will leave a big Garuda Indonesia has even the major Australian airlines $314,000 at Xiamen Airlines and hole in the pool of experienced cancelled flights because it senior pilots, training captains cannot fully man its flight roster. and flight instructors at many So have many airlines on the Alsim sells first flight training airlines. Mainland and in Thailand and device in China Secondly, if a cadet does India. In the Middle East, where French flight training company, Alsim, has sold its first AL42 not win a place in a funded airlines have long been accused Flight and Navigationn Procedures Trainer (FNPT) to new Mainland airline training program, he or of poaching pilots from rival flight training company, AXAviation, in Wuhu Anhui province. she must pay from US$75,000 carriers with very generous Anhui AXAviation Tech. Co. Ltd was established in April 2016 as to US$140,000 a year for the salary packages, the Gulf a private limited company with the aims of manufacturing flight 24-month course that prepares carriers are suffering from their simulators for the global market and also to offer pilot training a trainee for commercial airline own medicine as pilots depart courses. flying. For the self-funded for even better paid positions cadet, the cost of training can elsewhere. takes years to repay especially Analysts forecast Chinese as starting salaries at airlines airlines will need to hire almost are often low. As a result, the 100 pilots a week for the next industry loses potential pilots to 20 years to meet demand. To other professions because they keep pace with growth, many pay better. Mainland airlines are dangling Industry analysts said flying lucrative pay packages before has lost its glamour to Google, experienced foreign pilots. Apple and tech companies and Startup carriers barely that the industry must market known outside China are paying itself to the young generation if about 50% more to their cockpit it wants to ensure it has enough crews than many senior captains qualified pilots to fly its expanded earn at major U.S. and European Asia-Pacific and global fleet. ■

FEBRUARY 2018 / ORIENT AVIATION / 27 SA18_Visitor02_OrientAviation_202xx273.pdf 1 11/21/2017 11:20:20 AM

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Drones the cargo carriers of the future There is a silver lining to the increasing numbers of unmanned aerial vehicles flying the world’s skies, argues the International Air Transport Association (IATA). Chief correspondent, Tom of their global representative 777, that could carry almost 100 Ballantyne, reports. association is a revelation. kilogrammes of cargo. Hourcade pointed out companies Headquartered in Richmond, trialing drones are everywhere. California, Natilus has raised They include shippers and $750,000 from venture capitalist, e-commerce vendors such as Tim Draper, to develop its product magine a time when a they can integrate into their fleets. Walmart, Amazon and China’s but needs additional investment Singapore Airlines (SIA) So, they could decide to go the Alibaba, integrators like DHL to bring the project to fruition. freighter lands at Changi last mile. and UPS as well as postal Natilus chief executive, Aleksey airport with a valuable “They could also add bigger operators in Singapore, Australia, Matyushev, said the drone would cargo payload. Rather than drones to serve new routes or France, Switzerland, Spain, be powered by turbofan engines Ioffloading the goods to trucks thin routes that are too small to Ukraine and Germany. The big and standard jet fuel on missions for delivery to customers, instead operate traditional aircraft or aircraft manufacturers, Airbus at an altitude of approximately they are transferred to a purpose- don’t require the same runway or and Boeing, are working on 20,000 feet, well below built, pilotless drone owned by the same infrastructure as bigger unmanned aircraft projects. the airline and flown directly to planes. It’s an opportunity for Small drones are merely the waiting customers. The process is airlines to expand their reach.” beginnings of this breakthrough not only faster but cheaper than The use of drones is hardly technology. A U.S. company using road transport. new in aviation, but the notion has announced plans for an The International Air that airlines could get into the amphibious pilotless aircraft, Transport Association’s (IATA) business with the encouragement about the size of a Boeing head of cargo transformation, Celine Hourcade, said such a concept is fast approaching We believe the use of drones for reality – possibly within the next the transport of goods brings unique five years – and was waiting for opportunities for our member airlines. airlines to grasp the opportunities drone technology offered to the They offer opportunities for existing industry. players and for new players. Using Unmanned Aerial Vehicles (UAV), or drones, for fast This is a not to be missed delivery of freight from customer opportunity for our member to cargo terminal and from cargo airlines to capture new markets, terminal to customer made sense, she said. open new routes, reduce costs, Does she see airlines and their increase speed and cargo divisions having their own increase revenues drone operations? “Yes, I do,” said Hourcade. “It will be their Celine Hourcade decision individually to take it or International Air Transport Association (IATA) not. It is a new type of aircraft head of cargo transformation

FEBRUARY 2018 / ORIENT AVIATION / 29 NEWS BACKGROUNDER

commercial aircraft altitudes but medical requirements to ensure high enough to be fuel-efficient. Alibaba tests unmanned aerial non-segregated airspace is not Matyusheve said journeys compromised. across oceans would be vehicle package deliveries Carrying cargo is not the approximately 50% cheaper than Last November, Alibaba used drones to deliver packages over only opportunity drones offer commercial air freight transport water for the first time. Three unmanned aerial vehicles (UAVs) airlines, said Hourcade. Eighty runs. carried six boxes of passion fruit, at a weight of 12 kilograms, from per cent of aircraft inspections Commercial drone Putian in China’s eastern Fujian Province to nearby Meizhou Island. are conducted visually during Flying into a strong wind, the boxes took nine minutes to make business development required planned maintenance checks or the five kilometre crossing. The drones were jointly developed standardized global operating after unscheduled events such as by Alibaba’s delivery arm, Cainiao Network, the company’s rural standards, IATA said. An air traffic shopping platform, Rural Taobao, and a Mainland technology lightning strikes. management system also needs company. The drone delivery service cut the transportation time “Every inspection requires to be developed to integrate by half and reduced charges. qualified staff, using cherry- drone operations into the existing pickers, elevators and other heavy global ATM structure. equipment, to locate and log “Our goal is to facilitate (Unmanned Aircraft System Traffic and regulations, especially for defects on an aircraft. Typical this new branch of aviation by Management). The association international operations. This inspections last six to ten hours writing standards to support safe, has produced videos, including work is on-going within ICAO. and cost carriers $10,000 for every efficient, orderly, reliable and one in partnership with Airbus “Additionally, new airspace hour the aircraft is grounded,” sustainable drone operations into and UPS, to argue for relevant areas need to be defined, in she said. the airspace system,” said IATA’s regulation for the sector. particular below 500 feet and “Automated drones could director of ATM infrastructure, “If UAS operate in existing above 60,000 feet.” make the inspection 20 times Rob Eagles. airspace structure we need to Eagles said IATA is actively faster, reduce aircraft downtime, IATA is focused on three ensure they do so safely,” Eagles engaged in the development of enhance inspectors’ productivity areas: Safety, ATM – UTM said. “To do this, we need rules remote pilot training, licensing and and guarantee traceability.”■

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30 / ORIENT AVIATION / FEBRUARY 2018 INDUSTRY ADDENDUM

Digital warehouse for Lufthansa Technik Logistik Services

Wholly owned Lufthansa Technik subsidiary, Lufthansa Technik Logistik Services (LTLS), is automating, digitalizing and inter- connecting all its fundamental processes using The Internet of Things technology in its first digital warehouse at Munich airport. “We are testing and starting to implement digital assistance systems, localization technologies and driverless transport systems in selected areas of activity. We co-operate with specific start-ups. For example, we are introducing the smart glove the HNA-controlled carrier could acquire a Terminal 2, to enable integration with several data of Proglove as well as the automated holding of up 30% in PAPAS in two tranches external systems. The simplification of the vehicle of Agilox,” LTLS head of digital of new shares, subject to the approval systems will allow the airport to integrate gate innovation, Dr. Harald Kolbe, said. of PAPAS shareholders and the relevant and apron operation at both terminals into regulatory bodies. one system. Mainboard listed SIA Engineering Seoul Incheon airport accounts for more Company Ltd (SIAEC) said Hong Kong than 42% of passenger traffic in South Korea Airlines will invest US$2.8 million for a 15% and is the country’s busiest airport. ■ share in PAPAS through a subscription of new shares. Subject to certain conditions the carrier will have the right to increase its stake to 30%, at an estimated investment of up to $4.31 million. SIAEC’s holding in PAPAS will be reduced to 40% after the first share issue to Hong Kong Airlines. ■

ADB Safegate to upgrade Incheon Seoul operations

Core logistics processes are also planned The Incheon International Airport by the group for Frankfurt and Hamburg, Corporation (IIAC) has signed a contract with the ultimate goal of digitalizing all of with global provider of intelligent airport LTLS locations. Lufthansa Technik has 35 solutions, ADB SAFEGATE, to provide subsidiaries and affiliates. It is certified upgraded docking and management systems internationally as a maintenance, production at Seoul Airport’s Terminal 1. and design organization and has a workforce The IIAC will replace the present parking AAR announces partnership of 25,000 worldwide. ■ system with ADB SAFEGATE’s Safedock Type with inflight’s Viasat 1 Advanced Visual Docking Guidance System (A-VDGS). The installation also includes Global aftermarket solutions company, Hong Kong Airlines expansion of ADB SAFEGATE’ds control U.S. headquartered AAR, will provide buys into SIA Engineering and monitoring system, already installed at inflight connectivity logistics, repair and aftermarket management services to global joint venture communications company, Viasat. AAR’s OEM division will manage Viasat’s inventory Hong Kong Airlines has joined Malaysia pool that includes, antennas, radomes, Airlines (23.53%), Garuda Indonesia wireless access points (WAP) and power (17.65%), Royal Brunei (11.76%) and SIA supply units, said AAR OEM aftermarket Engineering Company Ltd (47.06%) as a president and general manager, Darren shareholder in Pan Asia Pacific Aviation Spiegel. Services (PAPAS). Under the agreement, AAR employs more than 5,000 people

FEBRUARY 2018 / ORIENT AVIATION / 31 INDUSTRY ADDENDUM

in 20 countries. Based in Wood Dale philosophy to create powerful, intuitive Illinois, It supports commercial aviation one-button inspection tools for the aviation LEASING customers in more than 100 countries. It maintenance industry. This design approach provides inventory management, OEM parts allows us to empower users of all skill levels China owned lessor, distribution, aircraft MRO and component with ‘go/no-go’ answers, not just data,” 8tree repairs. ■ CEO, Arun Chhabra, said. ■ CDB Aviation, reports robust 2017

China grants SR Technics Resource Group UK expands CDB leasing, headquartered in Dublin, Malaysia air worthiness Gulf training plans but 100% owned by the Mainland’s China Development Bank, said it certificate The UAE General Civil Aviation Authority executed 162 aircraft transactions (GCAA) has awarded British aviation technical for the 12 months to December 31, The Malaysian operations of global MRO, SR training Company, Resource Group, approval last year, which were the lessor’s best Technics recently received its air worthiness to perform aviation maintenance basic operational results to date. certificate from the Civil Aviation Authority training and knowledge examinations for both “Throughout this past year, the CDB of China (CAAC). The certification permits fixed wing and rotary aircraft. Aviation team achieved several major SR Technics Malaysia to certify components “We have strong and enduring milestones on our path to building a for new and existing airline customers on the relationships with the United Arab Emirates best-in-class global aircraft lessor, “ Mainland. through our other divisions. I am delighted CDB Aviation president and CEO, Peter “We are very excited about the new to add the training business capability to our Chang, said last month. certification for our component repair regional offering. In the coming months, we facility in Malaysia, which will strengthen will be talking to interested parties to discuss our position in the Asia-Pacific market,” how we can firmly establish ourselves as SR Technics Malaysia managing director, a key contributor to skills development in Thomas Kennedy said. the region,” said the company’s training Opened in 2014, the SR Technics solutions managing director, Ian Fitzpatrick. Malaysia facility has a component service Set up in 2003, the Resource Group offers centre for testing, repair, overhaul and courses from basic to advanced level in modification of aircraft and engine aircraft engineering maintenance. ■ components designed to service customers across the region. SR Technics also has announced a Global technology provider to the partnership with 3D scanner manufacturer, airline industry, Sabre, has announced 8tree, that will introduce the U.S. company’s a renewed distribution partnership dentCHECK solution to the global MRO’s with South Korea’s largest low-cost operations in Switzerland and Malta. The carrier, Jeju Air. The new contract will handheld wireless 3D scanner analyses the allow travel agents connected to the surfaces of metallic aero-structures and Sabre Travel Network to have access composite cabinet flooring, which will reduce to air content from Jeju Air that will Operational results included: inspection and reporting times on aircraft provide customers with a wider range * 38 new aircraft delivered to 15 undergoing MRO. of travel options and also increase airlines in nine countries “SR Technic’s adoption of dentCHECK is revenue at the airline. ■ * Nineteen aircraft sold a strong validation of 8tree’s rigorous design * Orders placed for 45 A320neo family aircraft, 52B737 MAX and eight B787s * Completed irrevocably guaranteed US$43 billion medium-term note program, under which $800 million was drawn down At year-end 2017, CDB Aviation had a fleet of 215 owned and managed aircraft on operating or finance leases and 184 orders for aircraft from Airbus and Boeing. It was listed on the Hong Kong Stock exchange in July 2016. ■

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Maint_E_202x273_Orient_Aviation-USD_20180201_01.indd 1 22.01.18 13:59 INDUSTRY INSIGHT SPECIAL REPORT ASIA’S AEROSPACE INNOVATORS Top of Asia’s aerospa ce league

Singapore is strengthening its position Transformation Map (ITM). The of 8.6% over the past two as the industry innovation hub for the ITM will pursue operational decades. excellence, drive innovation The future will undoubtedly region. More and more global aerospace in emerging technologies and be digital. As Asia-Pacific manufacturers are establishing research equip Singaporeans with the passenger traffic continues to centres in the Lion City with the goal of relevant skills for future space fuel global aviation, the ability to age development. capture, analyse and act on data developing technology that will propel As part of its expansion will make or break companies in the airline industry into the digital age. in the engineering sector, unpredictable markets. Dominic Lalk reports. Singapore wants companies to OEMs like Airbus, Boeing, invest in advanced automation Rolls-Royce and Honeywell y pumping investment aerospace companies based equipment, software and are making this future a reality into the region like in Singapore, but there also engineering capabilities to and establishing multi-million no other nation in is a growing presence of upgrade existing products and bases in Singapore to ensure the region, Singapore communications and space manufacture next generation long-term success. The city has become companies from leaders such aircraft components. intends to continue to develop Bthe unchallenged centre as SES and Inmarsat to space At the same time, the its manpower skills and for aerospace innovation. start-ups like Astroscale. city’s government will support infrastructure to support growth Encouraged by a committed To demonstrate the new degree programs at local in manufacturing, MRO and government and sustained importance Singapore attaches educational institutions and related aftermarket services. investment programs, engineers to its aerospace innovators, promote up skilling for aviation Such a policy commitment and IT workers from global OEMs its Economic Development professionals. EDB said the ITM has resulted in Singaporean to local start-ups are focusing on Board (EDB) reaffirmed its would boost the aerospace maintenance, repair and overhaul reinventing airline operations for commitment to the industry industry by US$3.05 billion and (MRO) industry winning 10% the new digital world. in January with the launch would create 1,000 jobs by 2020, of global MRO output. “Strong There are more than 130 of the Aerospace Industry after an average annual growth growth in the Asia-Pacific

Rolls-Royce launches IntelligentEngine

olls-Royce has the and overhaul engines. largest presence in A Rolls-Royce spokesman Singapore’s aerospace told Orient Aviation the group’s industry. The UK- strong commitment to Singapore headquartered will be shown by the unveiling Rmanufacturer produces up 15% its IntelligentEngine at the of Singapore’s aerospace output. Singapore Air Show. On the back of manufacturing The IntelligentEngine is This is much more than that. It’s from the engines with those of and R&D capabilities, it also what you get when three our vision of how we can work customers and partners, and provides large commercial circles—the product, the service with our customers to provide each feed links together the engines for customers such and the digital—come together,” power differently. It will drive all manufacturer, the technicians as Singapore Airlines, Qantas Rolls-Royce head of marketing, our behaviours, our decisions, who service it and its engine and Cathay Pacific. It has also Richard Goodhead, told Orient our investments,” Goodhead peers. Goodhead believes this forged joint ventures with local Aviation. “We’re not talking said. pooling of data will remove partners like Singapore Airlines about one specific engine type or The IntelligentEngine the distinction between their Engineering Company to repair a particular part of our CareStore. combines analysis of digital data physical goods and maintenance

34 / ORIENT AVIATION / FEBRUARY 2018 person instead of the current trucks and pave the way towards requirement of two. a seamless, efficient and The Automated Passenger autonomous apron. Loading Bridge (PLB) will use As the world’s largest Top of Asia’s aerospa ce league precision lasers and cameras, third-party MRO provider, to guide the docking process ST Aerospace plans to bring safely and autonomously. Under data-driven decision-making presents opportunities across the identified several ground support development by ST Dynamics, to its clients as well as its own value chain in manufacturing, automation projects in the the advanced engineering internal processes. Its digital MRO and aftermarket industry works. centre of ST Engineering, it is and productivity transformation segments. Aerospace companies Singapore Airlines the world’s first system to be initiative, Smart MRO, will will need to broaden their Asian Engineering Company (SIAEC) designed for robust operations offer customized predictive footprint and innovate to address has begun deploying a one-man under harsh weather conditions maintenance, drones for these new market needs,” said remote-controlled aircraft like heavy rain. If aerobridge aircraft inspection and additive Singapore’s minister for trade pushback air tug, to allow a tests prove successful this year, manufacturing for spare parts, and industry, S. Iswaran. pushback operation on narrow ST will extend the technology all in the name of better cost These opportunities are body aircraft to be done by one to other vehicles like catering efficiency and turnaround time. ■ being seized by the home- grown Singapore Aerospace Manufacturing (SAM). Between manufacturing automation and better software, the aircraft components manufacturer expects productivity gains of up to 30% in the next decade. Labour-saving automation and anaytics can be a great equaliser for firms regardless of size. Anchored by home-grown enterprises and MNC partners, Singaporean aerospace firms offer comprehensive nose-to-tail services, and the ITM has

service and that digital will now case today,” Schwob told Orient underpin everything they do. Hangar in the cloud Aviation. “The required full kit, “We think we are on the including tools, parts, technical brink of a closing together of irbus and Boeing an aircraft’s status is analysed documentation and processes to the three essential circles so have launched before the aircraft arrives at the follow, alrady will be gathered for that we get huge complements several important MRO facility, “The Hangar of the him.” of product and service, projects to Future” uses drones to run initial Airbus believes some of the supercharged by bundling digital showcase different structural inspection, followed by most impactful innovations lie technology. The big difference Aapproaches to intelligent systems autonomous intelligent systems in virtual, augmented and mixed now is that we are contextually solutions. At the Singapore Air and laser technology for closer reality (VR, AR and MR).François aware. As well as knowing what Show, Airbus will be highlighting non-destructive inspection. A Guillaume, Hangar of the Future’s is going on inside the engine, we “The Hangar of the Future”, data management system collects technical lead, describes AR and know where the engine is and a joint project with Temasek the information and assigns tasks VR as the perfect technologies to what it’s been through, what is Polytechnic University that is to teams via mobile devices with build a bridge between physical happening to it, how it’s being supported by the EDB and led by paperless manuals. 3D printers products and the digital world. In operated,” he said. a Singapore team under Cyrille will also manufacture some spare the case of a technical emergency Said Goodhead: “We see Schwob, Airbus Singapore’s parts on the spot. diversion to a remote location in this as a pivotal change, similar head of research and technology “The mechanic receives the Siberia, for example, AR would be to our first aero engine, when development Asia-Pacific. information needed to carry out a crucial way to guide technicians we did the first turbine engine or By essentially digitalising the required maintenance task on through an atypical repair. when we did the first supersonic and rebooting the MRO his tablet instead of running from “Maintaining an aircraft does engine.” ■ business with data on systems, one place to the other as is the not usually happen in a nice office

FEBRUARY 2018 / ORIENT AVIATION / 35 INDUSTRY INSIGHT SPECIAL REPORT ASIA’S AEROSPACE INNOVATORS

manufacturer information’ spares consumption; components and giving a global vision to a data; aircraft/fleet configuration; fragmented environment. It is on-board sensor data; and flight about going from a task-after-task schedules. philosophy to a complete end-to- Other data traditionally end, optimised process.” shared with Airbus on isolated Such innovation loops neatly servers will migrate there to with Skywise, Airbus’ open-data help airlines analyse and make integration and advanced decisions based on on-board analytics platform, which was aircraft data; post-flight, pilot launched in collaboration with and aircraft condition monitoring with air-con and good light. You performed on the aircraft and Palantir Technologies last year. reports, operational interruption have time pressure, it’s dark, anticipate modifications. Drones Airbus will be announcing history, parts replacements, it’s raining and the operators and robots such as Airbus’ new Skywise adopters at the service bulletins and technical themselves are trained on Air-Cobot robot will obtain Singapore Air Show after it documentation and requests. different aircraft. There are a lot specific information, previously launched the project with Skywise promises to of constraints,” Guillaume said. unattainable, such as aircraft several airlines, including AirAsia, improve fleet operational Automated non-destructive structure, flight hours and issues Emirates Airlines, Hong Kong reliability by predictive and testing, such as an inspection accumulated over time. Airlines and Peach Aviation, last preventative maintenance, scan of the aircraft when it enters “The whole challenge in ‘The year. rapid root-cause analyses of the hangar, will allow experts to Hangar of the Future’ project Skywise wants to be the in-service issues,optimising each concentrate on defect analysis is building digital continuity single platform of reference for aircraft’s performance from and classification instead of between individual entities and every major airline to improve flight operations data analytics, searching for data. RFID tags will technologies, so they seamlessly their operational performance and one-click reporting workflows, identify and track tools and parts. work together and talk to each business results and to support including complex reporting to The Internet of Things other,” Schwob said. their own digital transformation. regulatory bodies. In a nutshell, implementation will be interfaced “This is where Airbus brings It gives users a single access point Schwob said, Skywise will with the supervision module in value, acting as an all-time to enriched data by aggregating enable “a collective upgrade a control room to help operators integrator of complex pieces, sources into one cloud platform, in competences for the whole and customers follow activities adding contextual ‘airplane including airline data such as aviation ecosystem”. ■

In 2017, Boeing announced Boeing’s AnalytX solution more than 230 AnalytX orders, including commitments for ike its European rival, data analytics platform, AnalytX. mandatory.. Boeing does not. We the platform from Asia-Pacific Boeing is betting The American manufacturer leave it up to each airline,” Boeing carriers, All Nippon Airways, on Singapore’s hub told Orient Aviation it was “very Global Services vice president Biman Bangladesh Airlines, China status. Its Training & excited to launch this capability commercial services, Mike Airlines, Korean Air and Qantas Professional Services for customers in the coming Fleming, told Orient Aviation. Airways. This year, AnalytX is LSingapore Campus is the largest months” and had hopes to sign Launched in June, AnalytX gradually becoming embedded Boeing campus in Asia and up more airline customers to the is intended to make it easier in the group’s existing services offers seven full-flight simulators platform at the Singapore Air for airlines to slash fuel costs, applications, products under and four flight training devices, Show. perform predictive maintenance, development and its own including the first B737 MAX Unlike Airbus’ Skywise, build smarter flight plans and operations. simulator in the Asia-Pacific. Boeing retains a proprietary crew schedules and minimize The information systems add It also operates Boeing solution and does not agree with unpredictable disruptions. to Boeing’s existing portfolio of Asia-Pacific Aviation Services multi-platform data sharing. (BAPAS) as a joint venture with “Airline data contained in SIA Engineering Company (SIAEC) Boeing AnalytX data platforms to provide engineering, repair and or applications are available to maintenance services for Boeing the airline and Boeing under airplanes. Boeing’s Jeppesen agreement. The airline can decide office in Singapore delivers and if they wish to share it with implements digital solutions for other organizations. It may be airlines in this region. that Airbus’ Skywise made data Boeing has rolled out its own sharing between participants

36 / ORIENT AVIATION / FEBRUARY 2018 flight and technical analytics- applications subscribers like and advanced analytics could powered applications and an Airplane Health Management, mean significant savings for Boeing AnalytX analytics consulting service Fuel Dashboard, Flight airlines. We estimate they at work that provides end-to-end Planning and the In-Service can save between 2%-2.5% solutions for carriers. Data Program. Customers can of total global operating A B777 departed from the U.S. In December 2017, access data from Boeing app costs, which translates to interior bound for its European hub. Boeing announced a new through new analytics tools between US$5 million to $6 Less than an hour into its nine-hour flight, the airplane sent an Airplane analytics offering, the to get new insights for better billion annually,” said Oliver Health Management (AHM) alert to its Self-Service Analytics Cloud efficiency and performance. Wyman consultancy partner, maintenance control centre indicating Platform, for its digital “This new connectivity Sebastien Maire. ■ low tire pressure, a potentially serious issue which can result in tire failure upon landing and damage to the flaps to the maintenance costs per aircraft tune of a million dollars. Honey well’s and reduced APU-related Maintenance control used AHM tire delay minutes by 51%. pressure reporting to validate the alert. Honeywell will outfit The flight crew was diverted to a mainte- Connected Aircraft more than 60 of Cathay’s nance base that was given notice, and a crew was standing by with parts. The tires and Cathay Dragon’s A330s were replaced and the plane increased aking data cabin within one data pipe, with GoDirect Connected airspeed, arriving at its destination within available to with services under the Maintenance and the 20 minutes of its original schedule. pilots as well GoDirect product line in flight Hong Kong airline group is as operators planning, maintenance and considering extending the and equipment protection plans. service to its fleet of B777s. Mmanufacturers helps improve “This app-based approach Hainan Airlines’ current Airbus Skywise their overall situational enables operators and pilots fleet of more than 50 Airbus awareness, safety and to access real-time data, A330s and its future fleet of and AirAsia efficiency in the face of thereby increasing efficiency more than 40 A330s will also • AirAsia has integrated data from dispa- busy traffic and inclement and productivity,” Davis said. be outfitted with the service. rate sources on the Skywise platform and developed new capabilities against specific and immediate needs, including time-series analysis of large-scale DataBird sensor data, component reliability and repetitive fault analysis. Key results include: full deployment integrating several years’ worth of AMOS data across all AOCs as well as PFRs; deployment of component reliability, ‘rogue component’ and repetitive-fault applications which will allow reliability and maintenance teams weather. “There is an Maintenance is a key “During the Singapore to perform analyses at scale to improve fleet reliability; and continuous training incredible amount of growth service offering where Airshow, we will be on ‘Quiver’, a Skywise application opportunities for ASEAN to Honeywell offers tangible announcing a number of which allows users to visualise and boost its economy through a cost savings through large and important contract analyse large-scale sensor data to booming aviation industry as analytics. In 2017, Cathay wins involving our APU and perform flight-ops analysis, predictive it strives to facilitate a more Pacific and Hainan Airlines maintenance services with maintenance and troubleshooting. integrated airspace among signed up for the GoDirect major premium and low-cost • Skywise enables low-cost carrier, Peach the member countries,” Connected Maintenance carriers in ASEAN,” said Davis. Aviation, to automate the quality moni- Vice President, Airlines, Asia APU service, which combines Honeywell’s JetWave toring process and produce key metrics Pacific, Honeywell Aerospace connectivity, product satellite communications grouped by ATA chapter and aircraft in & Aerospace Leader, knowledge and data analytics hardware, which operates seconds. Reports which used to take days to compile are now made in only Honeywell International Sdn to predict when mechanical on Inmarsat’s Global Xpress a few clicks. For component reliability, Bhd, Brian Davis, told Orient parts need to be fixed or Ka-band network, has also another application uses data from the Aviation. replaced. Cathay’s trial been selected by Singapore platform to track unscheduled removals The Honeywell reduced inoperative systems Airlines, Qatar Airways, over time, run Weibull distributions over Connected Aircraft aspires by up to 35%, saved several Vietnam Airlines, Sri Lankan the data and determine the optimal to cover every aspect of hundred thousand dollars Airlines, Air New Zealand and replacement schedule. connectivity for cockpit and in operational and reactive Air Astana. ■

FEBRUARY 2018 / ORIENT AVIATION / 37 INDUSTRY INSIGHT SPECIAL REPORT ASIA’S AEROSPACE INNOVATORS Singapore Airlines fosters digital champions

Winning passengers is no longer a matter of updating product offerings at the region’s carriers. Innovation, driven by data analytics, is shaping an airline’s customer experience and also its operations. Chief correspondent, Tom Ballantyne, reports on Singapore Airlines’ plans to stay ahead of the game.

ingapore Airlines (SIA) is Award from the US-based Last month, SIA announced a very fortunate, said the Business Council for International partnership with LASALLE College SIA “Kris” bot carrier’s chief financial Understanding (BCIU); the first of the Arts, a Singapore-based officer, Stephen Barnes, recipient from Southeast Asia for tertiary education institution. in action to have a CEO who the award. Students enrolled in the programs ‘In December, SIA Sunderstands the importance gets Barnes said: “we are planning at the college will conceptualize launched a beta chat bot as the importance of innovation. for fewer people to be involved in and design an Innovation Lab to it expands digital servicing “You need leadership from the identifying and giving the green be set up by the airline. channels for customers. Initially, the Kris bot has been top. We are very blessed that light to particular projects. SIA’s The Innovation Lab will serve available on the SIA global our chief executive, Goh Choon strategy is to create a “digital as a collaborative workspace Facebook page and will soon Phong, has an IT background,” mindset” throughout the airline for SIA employees and external be on singaporeair.com. he said. and central to this is a new staff partners as well as being a test Customers who visit “He is enthusiastic about the training initiative, he said. bed for technology-related the SIA Facebook page or opportunities it offers and is very “We have made available projects, said SIA senior vice Facebook Messenger will much out in front trying to help a series of externally-provided president Corporate Planning, Lee be able to chat privately with us generate ideas,” he told the innovation and digital-focused Wen Fen. Kris and receive assistance recent World Financial Symposium training courses. The idea to Last October, SIA introduced for pre-flight-related queries. in Dublin. ensure that we not only have an Android Pay and Apple Pay As a beta bot, Kris will be in constant learning mode Goh, who holds bachelor occasional champion, but to have mobile payment services on and its capabilities will be degrees in computer science and everybody using the tools and to its mobile app. Customers can developed over time. At engineering, management science feel free to come up with ideas,” pay for air tickets, redemption present the bot is trained and cognitive science and a master Barnes said. booking-related fees, preferred for English language queries of science in electrical engineering “We need to identify seat selection and travel insurance about baggage, check-in, and computer science, all from champions. We need to identify and other services at the time of online booking and services the Massachusetts Institute of the successes. But we also booking. for travelling with infants and Technology, has been driving recognize we need to celebrate These are all parts of a children’ innovation forward since he took failures - at least heroic failures. wide-ranging SIA transformation “SIA will develop the charge at SIA on January 1, 2011. We need to learn when to kill program, which follow some Kris bot knowledge library based on the questions In recognition of his efforts, those ideas quickly and what the recent poor results at the carrier. customers ask most fre- Goh received the 2016 Dwight lessons for the next idea are,” he However, the airline reported a quently,” said SIA senior vice D. Eisenhower Global Innovation said. second-quarter net profit in the president Customer Services current fiscal year on the back & Operations, Marvin Tan. of stronger operating results “Customer preferences and rebounding cargo business. are changing and with Kris Yield remained under pressure as we are taking feedback into competitors increased capacity. account by expanding our The carrier earned US$139 million servicing platforms beyond in the three months to September traditional contact centre and email channels.” 30, up from $47.5 million a year earlier. ■

38 / ORIENT AVIATION / FEBRUARY 2018 Developing MRO Strategies for Aviation’s Global Powerhouse March 7-8, 2018 Hanoi, Vietnam

MRO East Asia gathers airlines and the supply chain for a two day conference in Hanoi, Vietnam.

Hear an analysis of regional MRO trends and strategies to capitalize on opportunities in a growing and highly competitive market.

Insight from industry leading speakers, including: Ranond Ravinder Raymond Tan Nguyen The Mintarkhin Pal Singh Head of Hoang Deputy Managing Chief Information Engineering Deputy Chief Director and Innovation and Fleet Technical Technical Dept, Of cer, Management, Of cer, Nok Air Tata SIA Airlines NokScoot Airlines Jetstar Paci c

Trinh Quoc Norbert Marx Zhu Xiao Martynas Qualifying airlines Cuong CEO and Vice President/ Grigalavicius attend for free. Commercial General Manager Chief Marketing CEO Director GAMECO Of cer FL Technics Asia Vietstar Aero Ameco Beijing Engineering

For the full speaker list, latest agenda and to register visit mroeastasia.aviationweek.com

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