Renowned panelists in the first panel discussion at the 20th World Routes Development Forum, which was held in Chicago on September 21, concluded that the global aviation industry is currently facing 5 critical challenges.
As per the results of live polling moderated by BBC World News presenter, Aaron Heslehurst, the delegates regarded infrastructure as the most critical challenge, with aviation profitability, safety/security, taxation and oil price stability being the other 4.
At the start of the session, the issue of safety and security was discussed, particularly in context of the recent incidents of MH17 and MH370. Managing director of Malaysia Airports Holdings Berhad (MAHB), Datuk Badlisham Ghazali appreciated the actions taken by the ICAO and other bodies in order to improve aviation safety, however, he emphasized on the need of enhanced visibility from global aviation bodies regarding the industrial developments aimed at increasing safety. Referring to MH17 tragedy, he said, “The industry needs to move forward in more visible way. Response has not been as visible as what I had hoped for.”
The issue of aircrafts flying over conflict area in eastern Ukraine was also brought up during the discussion. Thomas Windmuller, SVP airports, passenger and cargo services at IATA, asked why some airlines had the vital information not to fly while the others were not aware.
Profitability was another point of discussion in the forum and according to Windmuller, “We are in a period of sustained growth in volume, but not necessarily profitability. The number of airlines that recover their capital cost is very small… The problem is not just airlines, it is aviation. There are very few parts and components that are making big money. These include airports, and air navigation services, who do not make a profit, and do not cover their long-term capital costs.”
The delegate voting regarded Infrastructure challenges as the most serious issue being faced by the aviation industry today. The current investment in aviation infrastructure development projects vary a great deal from country to country. In some countries like China, big investments are being made for infrastructure development while in some other countries this trend is non-existent.
Trey Urbahn, the chief strategy officer of Azul Brazilian Airlines, said that the most pressing issue being faced by Brazilian aviation industry today is taxation. Giving example of Azul Brazilian Airlines, he said that 36% of the company’s profit go on taxes and that the company is working with the government to address this serious issue. He suggested that the taxation garnered should be re-invested for infrastructure development.
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