Vol. 25 No. 10 December 2018-January 2019 orientaviation.com ORIENT AVIATION PERSON OF THE YEAR 2018 GOH CHOON PHONG CEO Singapore Airlines DOING BUSINESS BEYOND TRADITIONAL AIRLINE BOUNDARIES Goh Choon Phong debates incremental change versus ground zero overhaul at the airline group China Southern Airlines Qantas “cloud cost map” Air New Zealand and abandons SkyTeam for to cut millions from ATR form venture to American partner group’s fuel bill develop regional aviation NEW Composite materials provide strength, durability and a lightweight design. Three user selectable modes of noise cancellation to match operational preference. Tap control for talk-through communication provides a “hear-through” function for off-intercom communication. Three sizes of eartips help ensure a comfortable and secure fi t. Optimized cable engineered for protection against EMI and electrostatic discharge. A new approach to noise reduction. 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SEE MORE AT BOSE.COM/PROFLIGHT Connect with us @BoseAviation © 2018 Bose Corporation 47478_Bose_PFCommunications_Single_OrientAviation.indd 1 10/3/18 2:48 PM Client: BOSE - Broadcast Communications Ad Title: Profl ight Communications Publication: Air Line Pilot Magazine - November Trim: 8.25” x 10.875” • Bleed: 8.375” x 11.125” • Live: .25” from trim CONTENTS Volume 25, Issue 10 COVER STORY 16 ORIENT AVIATION 2018 PERSON OF THE YEAR ORIENT AVIATION MEDIA GROUP 17/F Hang Wai Commercial Building, DOING BUSINESS 231-233 Queen’s Road East, Wanchai, Hong Kong BEYOND TRADITIONAL Editorial (852) 2865 1013 E-mail: [email protected] AIRLINE BOUNDARIES Website: www.orientaviation.com Mailing address: Singapore Airlines CEO, GPO Box 11435 Hong Kong Goh Choon Phong, Publisher & Editor-in-Chief pushing boundaries of Christine McGee technology to keep SIA at E-mail: [email protected] the top of the airline game Chief Correspondent Tom Ballantyne Tel: (612) 9638 6895 Fax: (612) 9684 2776 E-mail: [email protected] Greater China Correspondent Dominic Lalk Tel: (852) 2865 1013 E-mail: [email protected] North Asia Correspondent COMMENT 10 Low-cost carriers maintain head of steam but Geoffrey Tudor 5 Propping up flag carriers a recipe for failure challenges ahead for all Asia-Pacific airlines Tel: (813) 3373 8368 E-mail: [email protected] ADDENDUM Photographers 6 International Air Transport Association’s Rob Finlayson, Graham Uden, founding China boss retires Ryan Peters 6 Qantas cloud cost map to cut millions from Chief Designer annual fuel bill Chan Ping Kwan Printing Printing Station(2008) ALLIANCES 14 Global alliances adjusting to new operating ADMINISTRATION reality General Manager 14 Asia’s biggest airline deepens ties with American Shirley Ho Airlines E-mail: [email protected] 6 Malaysia Airlines Group fine tunes leadership structure INDUSTRY ADDENDUM ADVERTISING 7 Virgin Australia Airlines close to choosing CEO 21 Aireon creates customer affairs leadership role Asia-Pacific, Europe & Middle East Borghetti’s successor Clive Richardson Tel: (44) 7501 185257 E-mail: [email protected] CHANGES IN 2018 Digital revolution takes hold at region’s airlines The Americas / Canada Barnes Media Associates Ray Barnes Tel: (1 434) 770 4108 Fax: (1 434) 927 5101 E-mail: [email protected] [email protected] 21 ATR and Air New Zealand to explore future of Follow us on Twitter @orientaviation regional aviation Keep up with the news of the week 21 SITA reports China’s airlines and airports to with Orient Aviation’s Week in the spend big on cybersecurity Asia-Pacific 22 Boeing and UK’s ELG develop breakthrough © All rights reserved 8 CEO shuffle: recognition and ruptures at the top technology to recycle excess carbon fibre Wilson Press HK Ltd., 9 Cyber transition front and centre of airline 22 Hong Kong’s China Aircraft Services Ltd takes Hong Kong, 2018 transformation honors with VR MRO training platform DECEMBER 2018-JANUARY 2019 / ORIENT AVIATION / 3 Where are your next pilots coming from? Right here. Every year, we train 120,000+ pilots in our 50+ training centers worldwide. Add the 1,000 experienced pilots on assignment with airlines, placed by our aviation recruitment team, and the 1,500 new pilots graduating from our aviation academies yearly, and answering the question has never been so easy. Follow us @CAE_Inc Your worldwide training partner of choice COMMENT Propping up flag carriers recipe for failure It has been a challenging 12 months for Asia-Pacific from government owners, have settled management airlines but as another year draws to a close there has teams that enjoy the confidence of their boards. been some recent good news. Most of the region’s struggling carriers have Oil, which peaked at US$76 per barrel in October, their governments involved at a much deeper level of dropped below $60 in November. It is does not decision-making. In Malaysia, Thailand, Indonesia, India approach the price of $40 in 2016 and $52 in 2017 and and Sri Lanka the performance of state-owned airlines whether it is a trend in the volatile cycles of oil pricing is has been poor. anyone’s guess. There is a discussion to be had about the long-term The downward shift in the oil price highlights the viability of airlines rescued by governments and fact there are so many factors that challenge the ability therefore usually controlled by those governments. of airlines to make a profit. For an airline to succeed, airline leaders must have the In 2018 those challenges were much the same as freedom to complete their transformations without past years: increases in fees and charges, flight delays being removed half way through the process because because of cramped, overloaded and ill-equipped government owners don’t like what they are doing. airports and ATM systems, expensive investment Reputable forecasts point to a rich future for the in information technology and the cultural changes region’s carriers, both full service and low cost, but necessary to win and keep customers. unless competent management teams are permitted to In this world successful Asia-Pacific airlines, turn failing airlines around without outside interference, whether privately owned or operated at arms length many of today’s flag carriers will be no more. ■ TOM BALLANTYNE Chief Correspondent Orient Aviation Media Group The most trusted source of Asia-Pacific commercial aviation news and analysis ORIENT AVIATION ORIENT AVIATION CHINA “It has established itself as the primary source of information on industry topics in the Asia-Pacific region” DECEMBER 2018-JANUARY 2019 / ORIENT AVIATION / 5 ADDENDUM IATA’s founding China boss retires Baojian Zhang, a linchpin on the Mainland has grown to 36 of extraordinary service to IATA figure in the development of carriers, the largest concentration and to the airline industry. His the International Air Transport of member airlines of any achievements are impressive as Association’s (IATA) airline country, an IATA statement said. is the well-established and strong member expansion on the “In the last 24 years, our team he leaves behind. The Mainland retired this month China team has grown from three whole of IATA joins me in wishing after 24 years as its regional vice staff to more 130 in 2018 and Baojian all the very best for his president North Asia. IATA’s China BSP is the largest in well-deserved retirement.” Zhang joined IATA from the the world, recording almost 190 Until a permanent successor Civil Aviation Administration of million transactions in 2017,“ IATA is named, IATA’s regional vice China in 1994 when he set about said. president for the Asia-Pacific, establishing the global airline IATA director general and Conrad Clifford, also will body’s operations in China. Under CEO, Alexandre de Junaic, said: lead IATA in North Asia, the his leadership, IATA membership “I thank Baojian for his 24 years association said. ■ Qantas “cloud” cost map to cut millions from annual fuel bill Put together in collaboration “It’s a subtle shift to pick up with the University of Sydney’s the wind. And that is the beauty Australian Centre for Field of the system. It’s just being able Robotics, the “Constellation” to find those subtle changes [in system was launched in October patterns] that we could not do in with several of Qantas’s A380s, the old days of paper systems,” B747s and B787s. It will be the A330 captain said. installed across the entire fleet by “The older system was almost year-end 2019. like planning in your car. You just Qantas head of flight go left and right basically. The new operations systems, Allen system, built on work with drones, Dickinson, told media the new adds wings to your vehicle. It lets system had delivered impressive you fly in that dimensional space Qantas expected to reduce its reported earlier this month that results. and go to different altitudes at fuel bill by up to $40 million a the airline group was using cloud On a recent flight from different times.” year as a result of its new “cost computing to crunch the data of Sydney to Santiago Chile, Qantas estimates Constellation map”; a revamp of its route thousands of possible flight paths Constellation slightly diverted will reduce its fuel bill by close planning system that took five and the factors they encounter from the airline’s B747 route to to one per cent a year, or US$40 years and a multi-million dollar during a journey to determine take advantage of a tailwind. It million, based on the airline group’s investment to develop. the most efficient route between saved Qantas one tonne of fuel, estimate of US$4 billion in annual The Sydney Morning Herald destinations.