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The Long View Aircraft Finance & Commercial Aviation Conference Barcelona April 9 th 2013 Rohit Talwar - CEO Fast Future [email protected]

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TRANSCRIPT

The Long View

Aircraft Finance & Commercial Aviation Conference

Barcelona – April 9th 2013

Rohit Talwar - CEO – Fast Future [email protected]

Contents

• Presentation p. 3

• About Fast Future p. 55

• Image Sources p. 64

• Background Notes p. 69

‘Future Proofed’ Firms Work on

3 Horizons in Parallel

1-3 Years

Drive for

Growth

1-12 Months

Operational

Excellence

4-10+ Years

Creating

the Future

2030-2050

Genetic Profiles and Human Enhancement e.g. Trans-Cranial Direct Current Stimulation (tDCS)

GoFlow – Low Cost Home tDCS Kit

The New Paradigms

Economic and Political Outlook

Aviation Concepts - Hypersonic to Hyper-Slow

Supersonic Flight – Flying Wing

NASA -

Morphing

Planes

EADS -

Bionic

Structures

Space Tourism

Super Slow - Airship Hotels

Our Research suggests airports need to see themselves an

as ecosystem - An integrated portfolio of models

Future Proofing the Business

Mastery

Models

Magic

Management Mindset

Muscle Markets

Message Message

Market Insight –

Drivers of Future Business?

Market Insight

• External Drivers

• National / Regional

Context & Landscape

• Airline / Aircraft /

Airport Trends

Strategies

• Passenger

Demographics,

Needs and

Expectations

• Ancillary Drivers

Demographic Destinies 2 billion more people in 40 years –

Demographics is Driving Economics

1998

448 691

729

5231

4216

740

1051

346

596

Source : United Nations 2011 2050

Passenger Convenience

Mastery –

Service, Change, Insight,

Foresight, Technology and

Collaboration

Foresight and Insight e.g.

‘Horizon Scanning’ and

Timeline Development

Insight – In-flight Experience

EADS – Vitalisation, interaction and smart tech zones, morphing seats,

personalised environment control, holographic projection, transparent walls and

virtual reality projection

Process Excellence –

High Throughput Surgery

Narayana Hrudayalaya Hospital

Core Technologies Used by Pioneers Now Pioneered by 2015 Pioneered by 2025

Personal Technology

Mobile phones

3G / 4G smartphones

Augmented reality

Gesture recognition

Intelligent software assistants

Mind control headsets

3D displays (Glasses free)

Intelligent interfaces

Flexible screens

Digital currency

5G phones

Biologically embedded electronics

Eyewear embedded screens

Intelligent brain-computer interfaces

Streamlining the Passenger Journey

Biometrics –voice / facial / handprint

recognition

Quick-response (QR) codes

RFID

Interactive displays

Near field communications (NFC)

Temporary airports

Biometric signature – heartbeat pattern

Body language recognition

Robotics and automated services

Virtual airports

NFC integrated into all travel documents

and passports

Use of human genomic profiles

Enhancing the Passenger Experience

Social media

Passenger-polling systems

Hybrid platforms (i.e. Google Wave)

Interactive surfaces

Virtual worlds

Vertical farming (basic)

Next generation cinematic experiences:

6D and beyond

Real-time language translation

Reality mining

Wearable displays

Immersive web

3D printing

Biomimetic Design

Haptics technology

Touchable holograms

Vertical farming (advanced)

Information and Communications Technology (ICT) Infrastructure

Wireless broadband

Cloud computing

Telepresence

Big Data

Machine learning

Ambient / Embedded intelligence – the

‘Internet of Things’

Grid computing

MANETS (Mobile Ad-hoc NETworks)

Swarm intelligence

Intelligent web

Semantic web

Machine vision

Optical computers

Collective intelligence

Eye Tracking and Gesture Control

The ‘Internet of Things’

Artificial Intelligence

Big Data and

Predictive Analytics

Muscle –

Key Survival Capabilities

Rapid Decision Making

Speed of Execution

e.g. Ultra-Quick Construction

Research at ‘cutting edge of technological media innovation’ e.g.

human-computer interaction, augmented reality, online gaming,

internet television and semantic text processing

Muscle – Rapid Innovation e.g. Naspers' New Media Lab

(“Fail fast and cheaply” – Koos Bekker, CEO)

Magic – Creating the Wow Factor

Universal Translators

Next Gen Qantas Check-In

Korean Air – ‘Flying Spa’

TU Delft's Tray Table Cabinet

Reimaging Space

Immersive Environments

Message – Relevant Innovation

E.g. the $2,500 Tata Nano

Business Models –

Multiple Pre-emptive Solutions

Models – Access

‘Usership’ vs. Ownership

Possible Emergence of Asset-Free

Virtual Airlines

Crowdfunding e.g. Kickstarter.com

Crowdsourcing Design e.g. DARPA

Drone Design Competition

Models - Continuous Innovation

E.g. Auctions

£3088 £8791.50 £81

Mindset - 3 Horizon Thinking

• 12 Months

• 1-3 Years

• 4-10 Years

Mindset – Customer in Control

Social Seating – KLM

Mindset - Tolerant of Uncertainty,

Curious, Sticky and Magnetic

Encourage Experimentation

Management - Lead or Follow?

Focus on a Holistic View of

Complexity, Risk and Performance

• Customer Interface

• Process

• Organisation

• Information / Systems

• Regulatory

• Human

• Financial

Priorities for Future Proofed Firms

Mastery Markets

Models

Magic

Management Mindset

Muscle

Message Message

Conclusions – Winning Strategies

• Long term thinking

• Differentiate through

curiosity and innovation

• Technology as a key

enabler

• Experiment with

business models

• Work with and for

tomorrow’s passenger

[email protected]

About Fast Future

Fast Future –

Core Services

• Live Events - Speeches, briefings and workshops for executive management and boards of governments, investment funds, development agencies , companies, airlines, airports, hotels, venues, CVB’s and associations

• Future Insights - Customised research on emerging trends, future scenarios, technologies and new markets

• Immersion - ‘Deep dives’ on future trends, market developments, emerging issues and technology advances

• Strategy - Development of strategies and business plans

• Innovation - Creation of business models and innovation plans

• Engagement - Consultancy and workshop facilitation

Fast Future • Research, consulting, speaking, leadership

• 5-20 year horizon - focus on ideas, developments, people,

trends and forces shaping the future

• Clients

– ING, ABN Amro, Laing O’Rourke

– Marks and Spencer

– Airports - Aeroports de Paris / Schiphol Group

– Vancouver Airport Services

– Industry Associations – ICCA, ASAE, PCMA, MPI

– Corporates - GE, Nokia, Pepsi, IBM, Intel, Orange,

O2, Siemens, Samsung, GSK, SAPE&Y, KPMG,

Amadeus, Sabre, Travelport, Travelex, ING,

Santander, Barclays, Citibank, DeutscheBank

– Governments - Dubai, Finland, Nigeria, Singapore,

UK, US

– Convention Bureaus – Seoul, Sydney, London, San

Francisco, Toronto, Abu Dhabi, Durban, Athens,

Slovenia, Copenhagen

– Convention Centres – Melbourne,

Adelaide, Qatar, QEIICC

– Hotels - Accor Group, Preferred,

– Intercontinental

– PCO’s - Congrex, Kenes

Our Services Bespoke research; Identification & Analysis of Future Trends, Drivers & Shocks

Accelerated Scenario Planning, Timelining & Future Mapping

Identification of Opportunities for Innovation and Strategic Investment Strategy Creation &

Development of Implementation Roadmaps

Design & Facilitation of Innovation, Incubation & Venturing Programmes

Expert Consultations & Futures Think Tanks

Personal Futuring for Leaders and Leadership Teams

Public Speaking, In-Company Briefings, Seminars and Workshops

Example Projects • Public and private client research e.g. :

– Reinventing the Airport Ecosystem

– Development of Market Scenarios, emerging trends and strategies for key clients

– Government and OECD Scenario Projects – e.g. Migration 2030, Future of Narcotics, Chemical Sector, Family 2030

– Scenarios for the global economy for 2030 and the implications for migration

– Designing Your Future (Published August 2008) – book written for the American Society of Association Executives & The

Center for Association Leadership

– Global Economies – e.g. The Future of China – the Path to 2020

– The Shape of Jobs to Come – Emerging Science and Technology Sectors and Careers

– Winning in India and China

– The Future of Human Resources

– Exploiting the Future Potential of Social Media in UK Small to Medium Enterprises

– Convention 2020 – the Future of Business Events

– Future Convention Cities Initiative – Maximising Long-term Economic Impact of Events

– One Step Beyond – Future trends and challenges for the events industry

– Hotels 2020: Beyond Segmentation – Future Hotel Strategies

– The Future of Travel and Tourism in the Middle East – a Vision to 2020

– Future of Travel and Tourism Investment in Saudi Arabia

Hotels 2020 – Objectives

• Identify key drivers of change

for the globally branded hotel

sector over the next decade

• Examine the implications for:

Hotel strategy

Brand portfolio

Business models

Customer targeting

Innovation

• Global strategic foresight study to help the meetings industry prepare for

the decade ahead - Industry-wide sponsors

• Multiple outputs Nov 2009 – December 2011

• Current studies on future strategies for venues and destinations

Convention 2020

Rohit Talwar • Global futurist and founder of Fast Future Research.

• Award winning speaker on future insights and strategic

innovation – addressing leadership audiences in 40 countries on

5 continents

• Author of Designing Your Future

• Profiled by UK’s Independent Newspaper as one of the Top 10

Global Future Thinkers

• Led futures research, scenario planning and strategic

consultancy projects for clients in telecommunications,

technology, pharmaceuticals, banking, travel and tourism,

environment, food and government sectors

• Clients include 3M, BBC, BT, BAe, Bayer, Chloride, DTC De

Beers, DHL, EADS, Electrolux, E&Y, GE, Hoover, Hyundai, IBM,

ING, Intel, KPMG, M&S, Nakheel, Nokia, Nomura, Novartis,

OECD, Orange, Panasonic, Pfizer, PwC, Samsung, Shell,

Siemens, Symbian, Yell , numerous international associations

and governments agencies in the US, UK, Finland, Dubai,

Nigeria, Saudi Arabia and Singapore.

• To receive Fast Future’s newsletters please email

[email protected]

• 50 key trends

• 100 emerging trends

• 10 major patterns of change

• Key challenges and choices for

leaders

• Strategic decision making framework

• Scenarios for 2012

• Key futures tools and techniques

• Published August 2008

• Price £49.95 / €54.95/ $69.95

• Email invoice request to

[email protected]

Designing Your Future Key Trends, Challenges and Choices

Image Sources

Image Sources p.1 Page:

1. http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2013/4/1/1364803659854/Virgins-April-fool-glass--010.jpg

Left, right:

http://www.imabgroup.net/img/for-posts/multichannel.jpg

http://www.original-press-releases.com/2011/12/story-article-now-offering-free-article.html

http://www.mondolithic.com/wp-content/uploads/2010/02/You-Are-Only-Coming-Through-In-Waves.jpg

4. Clockwise:

http://batonrouge.myhomecareblog.com/files/2011/07/active_seniors4.jpg

http://www.energyrefuge.com/blog/wp-content/uploads/solar_power.jpg

http://www.nanotechnologyinvesting.us/images/nanotechnology-480.jpg

http://cdn.lightgalleries.net/4bd5ec0d18599/images/Cocoon_05-2.jpg

http://yogizendude.com/wp-content/uploads/2009/05/vertical_farm.jpg

http://blog.daqri.com/wp-content/uploads/2012/06/3D-printed-airplane.jpg

5. Left, right:

http://www.whatarenootropics.com/wp-content/uploads/2012/05/tcds.png

http://flowstateengaged.com/

6. Clockwise:

http://www.airbus.com/innovation/future-by-airbus/concept-planes/the-airbus-concept-cabin/future-technologies/

http://assets.inhabitat.com/files/terreformfabtreehab1.jpg

http://english.sina.com/technology/p/2009/1125/288206.html

http://www.synthetic-biology.info/images/synbio.jpg

7. http://sites.psu.edu/raw5308/files/2012/03/0102072148300.jpg

8. http://weburbanist.com/wp-content/uploads/2009/04/concept_planes_main.jpg

9. http://www.technewsdaily.com/images/i/7596/original/supersonic-flying-wing-02.jpeg?1348072306

10. Top, bottom:

https://mdao.grc.nasa.gov/postcards/CD3/cardimage003.gif

http://www.airbus.com/innovation/future-by-airbus/concept-planes/the-airbus-concept-cabin/vitalising-zone/

11. Clockwise:

http://s1.ibtimes.com/sites/www.ibtimes.com/files/styles/picture_this/public/2011/08/26/150908-zero2infinity-balloon-for-near-space-travel-by-2013-spectacular-

pictur.jpg

http://ut-images.s3.amazonaws.com/wp-content/uploads/2010/07/Space_elevator2.jpg

http://www.igorstshirts.com/blog/conceptships/virgin_spaceship_two_model.jpg

12. Left, right:

http://www.popsci.com/files/imagecache/article_image_large/articles/cp0206luxHotel_485.jpg

http://rossignol.cream.org/new/airhotel.jpg

Image Sources p.2

13. http://www.amadeus.com/airlineit/resources/reinventing_the_airport_ecosystem/img/amadeus-reinventing-the-airport-ecosystem-2012-en-

infographic.jpg

14. From left to right top; bottom:

http://www.iwmsnews.com/wp-content/uploads/2009/05/globe.jpg

http://www.shareyourride.net/images/Its_Never_Too_Late_To_Become_A_Surfer_Dude/Really_Big_Wave.jpg

http://hotindiancelebrities.com/wp-content/uploads/2008/05/surya-six-pack-abs-gallery-1.jpg

http://ricotheclownandmagician.com/IMAGES/magic-hat-stars.gif

http://www.sonc.co.uk/xxIMMAGINI/sonc_Corp%20&%20Brand%20Identity.jpeg

http://www.subhub.com/custom/5ways/m3f85a9df.png

http://www.successfulaffiliate.com/images/positive-mindset.jpg

http://blog.vavia.in/wp-content/uploads/2011/01/leadership.jpg

15. http://airobserver.files.wordpress.com/2011/03/money-airplane.jpg

17. http://www.un.org/esa/population/unpop.htm

18. Clockwise:

http://www.guenthermetzger.com/wp-content/gallery/red-cab/red_cab_24032011_3010.jpg

http://www.defaiya.com/defaiyaonline/index.php?option=com_content&view=article&id=838&Itemid=70&lang=en

http://hindifilmnews.com/wp-content/uploads/2011/05/john-abraham-sky-bags-2.jpg

19. http://boardingarea.com/blogs/lufthansaflyer/2012/06/28/a-la-carte-dining-with-austrian-airlines-and-do-co-order-your-meal-before-your-

flight/

20. http://www.shareyourride.net/images/Its_Never_Too_Late_To_Become_A_Surfer_Dude/Really_Big_Wave.jpg

23. http://www.airbus.com/innovation/future-by-airbus/concept-planes/the-airbus-concept-cabin/vitalising-zone/

24. http://www.chennaibest.com/Articles/Narayana-Hrudayalaya-plans-to-set-up-100-low-cost-hospitals_clip_image001.jpg

26. http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

27. http://smartdesignworldwide.com/thinking/wp-content/uploads/internetofthings_480x324_final.jpg

Image Sources p.3

28. http://readwrite.com/files/styles/800_450sc/public/files/fields/shutterstock_artificial%2520intelligence.jpg

29. http://siliconrepublic.com/fs/img/big%20data%20650%20shutterstock_104929805.jpg

30. http://hotindiancelebrities.com/wp-content/uploads/2008/05/surya-six-pack-abs-gallery-1.jpg

31. Left, right:

http://mandatemedia.typepad.com/photos/uncategorized/2007/07/10/coca_cola.jpg

http://somewordsandpictures.files.wordpress.com/2009/06/this-water-innocent.jpg

32. http://images.gizmag.com/gallery_lrg/arkhotelchangsha.png

33. http://www.cambridgemedialab.com/1%20-%20Copy.jpg

34. http://ricotheclownandmagician.com/IMAGES/magic-hat-stars.gif

35. http://www.hackcollege.com/wp-content/themes/HackCollege/images/timthumb.php?src=http://www.hackcollege.com/wp-

content/uploads/2012/11/UniversalTranslator-1.jpg&w=780

36. http://www.designboom.com/weblog/cat/8/view/11002/marc-newson-next-generation-check-in-for-qantas.html

37. http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

38. http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

39. http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-concept/

40. http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

41. http://www.autofocusasia.com/management/images/features_of_tata_nano.gif

42. http://www.subhub.com/custom/5ways/m3f85a9df.png

43. Left, right:

http://3008docklands.com.au/article/neighbourhood/1490

http://www.answers.com/topic/cloud-computing

44. http://news.discovery.com/tech/zooms/flapless-demon-aircraft.html

45. Top, bottom:

http://assets.sbnation.com/assets/828858/kickstarter-project-goal-800.jpeg

http://www.theverge.com/2011/12/20/2644358/kickstarter-success-product-development-revolution

Image Sources p.4

46. http://www.robotspodcast.com/images/DarpaUAVFoursome.jpg

http://www.suasnews.com/wp-content/uploads/2011/10/UAVForge.jpg

48. http://www.visualphotos.com/photo/2x4524045/businesswoman_on_ladder_looking_through_binoculars_bld005521.jpg

49. http://blog.apex.aero/prepost-flight/airline-social-seating-system-strikes-fancy/

50. Left, right:

http://3.bp.blogspot.com/_pte2XO66Nwg/SKxbGnqa6DI/AAAAAAAAB2I/g4HX25sx1MQ/s400/magnet%2Bman2.jpg

http://embunpagi2009.files.wordpress.com/2009/02/seedling1.jpg

51. http://2.bp.blogspot.com/-EJhAZaiyA8E/TfRRHfKzDMI/AAAAAAAAAGo/JmTQLz1z0xc/s320/6a00d8341c65c453ef010536d4981b970c-

800wi.jpg

52. http://infolific.com/images/fun/metaphor-for-complexity.gif

53. From left to right top; bottom:

http://www.iwmsnews.com/wp-content/uploads/2009/05/globe.jpg

http://www.shareyourride.net/images/Its_Never_Too_Late_To_Become_A_Surfer_Dude/Really_Big_Wave.jpg

http://hotindiancelebrities.com/wp-content/uploads/2008/05/surya-six-pack-abs-gallery-1.jpg

http://ricotheclownandmagician.com/IMAGES/magic-hat-stars.gif

http://www.sonc.co.uk/xxIMMAGINI/sonc_Corp%20&%20Brand%20Identity.jpeg

http://www.subhub.com/custom/5ways/m3f85a9df.png

http://www.successfulaffiliate.com/images/positive-mindset.jpg

http://blog.vavia.in/wp-content/uploads/2011/01/leadership.jpg

54. http://nextnature.net/wp-content/uploads/2008/02/planes.jpg

Background Notes

Economic Outlook

Breakdown of components of average real growth in GDP at PPP (2011 – 2050)

Source: PwC (2013), World in 2050: The BRICs and Beyond: http://www.pwc.com/en_GX/gx/world-2050/assets/pwc-world-in-2050-report-january-

2013.pdf

Economic Outlook

Source: PwC (2013), World in 2050: The BRICs and Beyond: http://www.pwc.com/en_GX/gx/world-2050/assets/pwc-world-in-2050-report-january-

2013.pdf

Relative GDP at MERs and PPPs in 2050 (as % of US level)

Economic Outlook

Relative size of G7 and E7 economies: 2011 and 2050

Source: PwC (2013), World in 2050: The BRICs and Beyond: http://www.pwc.com/en_GX/gx/world-2050/assets/pwc-world-in-2050-report-january-

2013.pdf

Economic Outlook

Source: PwC (2013), World in 2050: The BRICs and Beyond: http://www.pwc.com/en_GX/gx/world-2050/assets/pwc-world-in-2050-report-january-

2013.pdf

E7 and G7 growth paths in PPP terms

IATA Scenarios

• The world in 2050:

• The global population has grown from 6.9 billion to 8.9 billion, birth rates

have continued to decline and radical new healthcare technologies have

resulted in life expectancy in developed countries rising to 99 years.

• The GDP of the G20 countries increased from $38 trillion in 2009 to $170

trillion in 2050. China became the world’s largest economy and China, India,

Brazil, Russia and Mexico account for just over 50% of the GDP of the G20

countries.

• New technology has revolutionised the way that people live their lives.

Access to information in real time at any time of the day and anywhere on

the planet is a more widely held expectation.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• People manage their lives using Lifestyle Integrated Management Pods

(LIMPs), which are small portable devices containing all necessary personal

data related to their owners.

• Both economic development and technological advances have changed the

shape of global geopolitics for the better.

• There is a greater economic parity between countries but tensions between

different states still exist over a number of issues like fresh water supplies.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• The airline industry in 2050:

• An industry that carried 2.4 billion passengers and shipped 40 million

tonnes of goods in 2010 carried 16 billion passengers and shipped 400

million tonnes of goods in 2050.

• Air transport has grown at almost twice the rate of GDP expansion - more

people are travelling than ever before and more frequently than ever before.

• The industry has adopted global advances in general technology.

• Travelling by air is faster (when desired), safer and more seamless than

ever before.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Mobile technology available to air transport consumers is also affecting

passenger behaviour. LIMPs mean allow passengers change effortlessly

and seamlessly change their itineraries when they see fit.

• In-flight entertainment systems are no longer present on most aircraft,

• because passengers take all their personal audio, video or virtual

entertainment on board.

• Vastly improved high-speed train networks are now the norm in developed

economies and the train is often the preferred alternative for journeys of

fewer than 500 miles.

• For customers wishing to travel longer distances, air travel remains the only

option available.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Who are the customers in 2050?

• Population aging has resulted in the average customer being on average

older than ever before. Healthcare advances mean that even though our

customers are older, they are not necessarily less mobile.

• Younger travellers are significantly more aware of air travel and more

worldly-wise than previous generations. They also have well-established

preferences about air travel including brand loyalty.

• It is expected that there will be new opportunities for companies to generate

brand loyalty amongst a new generation of travellers.

• Younger travellers are also much more technologically advanced.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Customer priorities in 2050:

• Safety and security are still top priorities for passengers in 2050. Safety in

particular is less of a concern, as automation and new technology have

continued to revolutionize safety standards.

• The same technology has meant that reliability is also something that plays

a decreasing role in consumer choice, given that flights are almost always

on time and are almost never cancelled.

• Sporadic security threats regarding air transport still exist, although their

number have decreased.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Price is still a key driver of consumer choice, but access to information has

made price transparency almost absolute, which has made price differences

between comparable products almost extinct.

• Price has become more of a driver when choosing between different

product types, and operators have learned to offer a wider array of products

to cater to every need.

• Regardless of the passenger segment, pricing has become more reflective

of the most precious of commodities: time.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Business people still value their time above all else and are therefore willing

to pay a premium for the fastest available transport options.

• Amongst leisure passengers, technological advances and the elimination of

security, customs, and immigration delays have fuelled a large increase in

the demand for international and cross-cultural travel.

• Older travellers are seeking greater comfort and convenience, as well as a

slower pace or travel.

• For pre-adolescent travellers, priorities have not changed substantially -

these consumers still basically just want to be enter-tained.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• For adolescents, entertainment is also still a high priority, but entertainment

that is more about being social than individual. Some operators now offer

“adolescent only” sections on their larger aircraft, to enable adolescents the

opportunity to meet, play games, and even establish friendships with people

of their own age.

• This trend is also the case for young adults, as more and more operators

offer the opportunity for them to use their journey to meet and socialize with

members of the opposite sex.

• Customers from what used to be called developing economies are trying air

transport services for the first time in ever-increasing numbers. Rising living

standards normally lead them into the tourism market.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

IATA Scenarios

• Those customers from developed economies are demanding more and

more authenticity and customization. For them, just travelling by air is not

enough, they want a personal and unique experience. Having visited every

continent and scores of different countries, these passengers are

increasingly looking for something ‘extra’, something ‘special’. Week-long

‘Aircations’ (cruises in the sky) have become popular. Space travel is

becoming more reasonably priced but is still an indulgence for a few.

• One demand that has become consistently high among every type of

traveller is customer service.

• Ethical consumerism continues to be a growing trend and focuses on issues

like the preservation of local cultures and livelihoods.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

BOEING GLOBAL MARKET

FORECAST

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

• Boeing (2012) expects global economic growth to average 3.2% over the

next 20 years, fostering 5% annual growth in passenger traffic and 5.2%

annual growth in cargo traffic.

• Boeing suggests that airlines are responding to market pressures –

deploying capacity more strategically to help boost yields and cover high

fuel expenses.

• Airlines are optimizing airplane utilization more closely to seasonal demand

fluctuations.

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

• In general, the industry continuously adapts to varied market forces,

including fuel price, economic growth and development, environmental

regulation, infrastructure, market liberalization, airplane capabilities, other

modes of transport, business models, and emerging markets.

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

• Boeing’s analysis suggests that sustained investment in aviation

infrastructure is crucial to the continued growth of commercial aviation.

• The projected commercial air traffic growth is expected to increase

congestion at airports around the world as demand for takeoffs and landings

reaches or surpasses airport capacity over the next 20 years.

• Continued infrastructure investment is pa rticularly important in regions,

such as China, Northeast and Southeast Asia, India, and Latin America,

where aviation growth outpaces planned infrastructure development.

• Airport authorities are investing in large capital projects, including new or

improved runways, terminal expansions, and entirely new airports.

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

BOEING GLOBAL MARKET

FORECAST

• Many national and regional airspace management agencies are engaged in

programs to overhaul airspace systems (NextGen programme in the U.S.

helping airports run smoother).

• In general, Boeing suggests that although airports and governmental air

services agencies will need to continue investing in infrastructure

improvements, and airlines will need to evolve strategic responses at some

airports, congestion will not be a major limiting factor to commercial air

traffic growth.

Source: Boeing, (2012), Current Market Outlook 2012-2031:

http://www.boeing.com/assets/pdf/commercial/cmo/pdf/Boeing_Current_Market_Outlook_2012.pdf

Key Drivers for Traffic Growth

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth Emerging economies drive strong travel growth

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth

Airlines are becoming more efficient

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth

Oil prices are expected to remain high in the long term

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth 42 cities in the world handle more than 10,000 long haul passengers per day

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth By 2031 the number of these cities will be over 90

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Travel Markets

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Source: IATA PaxIS, IMF

Travel Markets

• IATA (2011) suggests that once real GDP per capita reaches $15,000-

$20,000 the number of trips by air per head of population levels out.

• U.S. and Europe, the world’s largest markets, were approaching saturation

as of 2011.

• The BRIC economics have very underdeveloped travel markets and are

likely to be a very large source of new travel demand in the decades ahead.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Travel Markets

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Source: Michael Porter

Indicative evolution of airline markets

Key Drivers for Traffic Growth

Air travel remains a growth market

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth

Asia-Pacific airlines to lead world traffic by 2031

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Key Drivers for Traffic Growth

Domestic PRC and domestic India lead the growth in RPKs to2031

Source: EADS (2012), Airbus Global Market Forecast 2012-2031: http://www.eads.com/dms/eads/int/en/investor-relations/documents/2012/presentations/2012-

31-Global-Market-Forecast/Global%20Market%20Forecast%202012-2031.pdf

Total World Passenger Traffic to

2025

Source: ACI, 2007: http://www.aci.aero/aci/aci/file/Economics/ACI%20Executive%20Summary.pdf

Total World Passenger Traffic to

2025

Source: ACI, 2007: http://www.aci.aero/aci/aci/file/Economics/ACI%20Executive%20Summary.pdf

Value Creation in the Airline

Industry Value Chain

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Value Creation in the Airline

Industry Value Chain

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Majority of capital invested in airlines and airports

Source: McKinsey & Company for IATA

Flight Numbers in Europe

• Eurocontrol’s medium term forecast of flight numbers in Europe covers 44

markets for the period 2012 to 2019.

• The forecast suggests that the average growth rate of flight numbers will be

2.3%.

• CAPA, the Centre for Aviation, citing Eurocontrol, suggests that Turkey will

lead the growth in the Eastern countries in the period to 2019.

• Airport capacity constraints and competition from high speed rail are

forecast to cut 1.6% from the total of flights in 2019.

• Flights to non-European destinations are expected to see the highest

growth rate.

Source: CAPA, 07/03/2013: http://centreforaviation.com/analysis/eurocontrol-flight-movement-forecasts-to-2019-go-east-young-man-100117

Flight Numbers in Europe

ESRA08 – Eurocontrol Statistical Reference Area. H = high growth case; B = base case; L = low growth case

Source: Eurocontrol

Source: CAPA, 07/03/2013: http://centreforaviation.com/analysis/eurocontrol-flight-movement-forecasts-to-2019-go-east-young-man-100117

Flight Numbers in Europe

Source: Eurocontrol

Source: CAPA, 07/03/2013: http://centreforaviation.com/analysis/eurocontrol-flight-movement-forecasts-to-2019-go-east-young-man-100117

Short-term Forecast – Airline

Passenger Numbers • Citing IATA, Skift (2012) suggests that a robust growth is expected in airline

passenger numbers through 2016, much of it generated by the domestic airline

market in China.

• Skift states that IATA predicts 3.6 billion passengers will board commercial

aircraft in 2016, a 28.5% increase compared to 2011. That growth rate equals

5.3% per year.

• There will be 831 million additional passengers flying in 2016, 59 million (19.1%)

will be Chinese citizens traveling within China. China’s international passenger

numbers are projected to increase by just 34 million by 2016.

• IATA states that growth in passenger volume in domestic markets (500 million)

around the world is projected to outpace international passenger growth (331

million) in the period to 2016.

Source: Skift, 06/12/2012: http://skift.com/2012/12/06/forecast-domestic-china-flights-to-propel-global-passenger-growth/

Short-term Forecast – Airline

Passenger Numbers • In 2016, the U.S. will continue to be the largest market for domestic

passengers (710.2 million) and international travel (223 million passengers).

• The U.S. domestic passenger growth rate (2.6%) and international

passenger growth rate (4.3%) are below the global averages of 5.2% and

5.3% for domestic and international growth, respectively.

• Asia-Pacific will be the largest regional market in 2016 with one-third of all

global passengers while Europe and North America will secure shares of

21% each.

• Only Africa, with a compound annual growth rate of 6.8% through 2016, is

projected to beat Asia-Pacific’s CAGR of 6.7%, although Africa’s regional

best comes from a lower base of passengers.

Source: Skift, 06/12/2012: http://skift.com/2012/12/06/forecast-domestic-china-flights-to-propel-global-passenger-growth/

The Middle East

• Homaid Al Shemmari, executive director of Abu Dhabi's Mubadala

Aerospace, suggests that manufacturers must invest more in infrastructure

in the Middle East if they want the region to remain a major market for their

products.

• Al Shemmari is urging the industry to industry to follow the large airliner

manufacturers in establishing industrial partnerships as well as training and

maintenance facilities.

• Al Shemmari says that although the UAE is a large buyer of business

aircraft, it doesn’t want to "continue in the same game" as a consumer of

products rather than an integrated part of the industry.

Source: Flightglobal, 11/12/2012: http://www.flightglobal.com/news/articles/meba-mubadala-urges-business-aircraft-manufacturers-to-invest-in-the-regions-

industrial-infrastructure-380010/

The Middle East

• This was the motivation behind the setting up of STRATA in Al Ain in 2007 -

a Mubadala-owned start-up focused on the design and production of

composite components for airliners.

• STRATA is a risk-sharing supplier to Airbus, and is expected to manufacture

for Boeing in 2013.

• Any collaborations would have to be based on high-end design engineering

rather than low-value production. Al Shemmari says that people need to

think about the Middle East in a different way as it is becoming a global

player.

Source: Flightglobal, 11/12/2012: http://www.flightglobal.com/news/articles/meba-mubadala-urges-business-aircraft-manufacturers-to-invest-in-the-regions-

industrial-infrastructure-380010/

Customer Satisfaction

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

Source: University of Michigan

Customer satisfaction with airlines compared to other industries

Customer Satisfaction

• IATA (2011) suggests that the bargaining power of customers is high and

rising.

• Channels have become significantly more concentrated (internet websites)

and travel agents more aggressive in pursuing the interests of the end

customers. A significant share of end consumers is highly price sensitive,

especially among the new consumers that have driven demand growth in

mature markets.

• There is a low perceived willingness to pay for service features unrelated to

ticket flexibility.

• Customer loyalty to specific airlines is low, but frequent travellers react to

the incentives of customer-loyalty programs.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

The Customer of the Future

• The passenger market is expected to expand and diversify by 2050.

• As air travel becomes accessible to more regions and sections of society,

the airlines of the future might have to market and provide their services to a

far more heterogeneous customer base.

• Therefore, marketing strategies will have to be refined from a broad-based

orientation towards focused segmentation, from mass customization to

insight-driven development and from mass marketing to differentiated

branding.

• A key challenge for the industry is to keep ahead of the rising demand

curve.

Source: IATA (2011), Vision 2050: http://www.iata.org/pressroom/facts_figures/Documents/vision-2050.pdf

APEX – Passenger Choice

Awards

• Best Overall Passenger Experience – Emirates.

• Best Overall Passenger Experience (Up to 50 IFE EQUIPPED IN FLEET) –

Virgin America.

• Best in Region: Africa – South African Airways.

• Best in Region: Americas – Virgin America.

• Best in Region: Asia and Australasia – SriLankan Airlines.

• Best in Region: Europe – Virgin Atlantic.

• Best in Region: Middle East – Emirates.

• Best Inflight Publication – Southwest Airlines.

Source: APEX, 2012: http://apex.aero/Awards/PassengerChoiceAwards/CurrentAwardWinners/tabid/228/Default.aspx

APEX – Passenger Choice

Awards

• Best Inflight Connectivity & Communications – Norwegian

• Best Inflight Video – Kingfisher Airlines

• Best Cabin Ambiance – Virgin America

• Best Food & Beverage, in conjunction with IFSA – Singapore Airlines

• Best Ground Experience – Kingfisher Airlines

Source: APEX, 2012: http://apex.aero/Awards/PassengerChoiceAwards/CurrentAwardWinners/tabid/228/Default.aspx

APEX – Passenger Choice

Awards

• Avion Award: Best Single Achievement in Passenger Experience:

• Airline – Brussels Airlines: The New Long Haul Cabin.

• Vendor – Lufthansa Systems: BoardConnect.

• Avion Award: Best Achievement in Technology

• Airline – Delta Air Lines for Demystifying the Checked Baggage Experience.

• Vendor – Panasonic for the eXTV.

Source: APEX, 2012: http://apex.aero/Awards/PassengerChoiceAwards/CurrentAwardWinners/tabid/228/Default.aspx

Korean Air

1. Korean Air:

• Korean Air is at the top of airlinetrends.com’s 2012 ranking of the world’s

most innovative airlines.

• The carrier has established itself as a major hub carrier for passengers

travelling between Asia and North America.

• Its A380 flagships have the lowest seat density of any A380 operator and

feature bars and lounges branded by Absolut Vodka and a duty-free shop.

• Korean Air operates its own organic farm and offers alternative service

amenities such as a coat storage service and women-only lounge at Seoul’s

Incheon Airport.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Korean Air

• Korean Air is taking advantage of South Korea’s open sky policies to target

travellers flying between East Asia and North America. The airline’s short-

haul route network spans 22 cities in China, 15 cities in Japan and has a

market share of 25% in the Chinese-North America market.

• Analysts forecast an optimistic future for Korean Air and suggest it will

benefit from Chinese tourists and the increasing export of consumer

electronics and automobile components.

• In 2007, Korean Air bought 28% stake at a South Korean oil company ( S-

Oil) to secure a stable supply of jet fuel.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Korean Air

• While many airlines across Asia are currently busy establishing their own

low cost carriers, in 2008 Korean Air launched a low cost subsidiary –Jin Air

– in order to compete with Korea’s high speed rail network.

• In 2011 the carrier completed an aggressive fleet expansion and a cabin

refurbishment program.

• The airline is also the first A380 operator to dedicate the entire upper deck

of the superjumbo to Business Class, creating a business jet-like

atmosphere.

• Keehong Woo, the head of the Korean Air’s passenger business division,

says that the carrier hopes to better market itself to international

corporations with the A380 business-only upper deck.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Korean Air

• Onboard bars and lounges:

• The carrier has installed three onboard bars co-designed in partnership with

Absolut Vodka. The bars feature three signature Korean Air Absolute

cocktail drinks and a display tower.

• Duty-free display:

• Korean Air generated $201 million in duty free sales in 2011 and is seen as

the world’s most successful in-flight retailer.

• Because Korean and Chinese top the list of duty-free spenders, the airline

is the first in the world to feature an onboard duty-free store.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Korean Air

• Catering:

• Korean Air is an active proponent of Korean-style meals and organic produce.

For example, passengers in all classes can choose to sample South Korea’s

national dish – bibimbab.

• The airline also operates its own organic farm through its subsidiary Korea

Airport Service. The airline’s Jedong Ranch is located 400 meters above sea

level on the mid-slopes of Mt. Halla on Jeju, a volcanic island located off the

south coast of South Korea.

• The organic beef and chicken are part of meals served in First Class. However,

responding to the growing demand for healthy food, in 2011 the airline started to

offer low-calories salmon salad and noodle dishes to Economy Class

passengers.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Korean Air

• Service touches:

• Catering for the needs of female passengers, 45%, the airline refurbished

its prestige lounge at Incheon Airport, offering a dedicated area for female

travellers including a sleeping room, rest room and powder room.

• Korean Air is also one of the few airlines in the world to dedicate bathrooms

onboard for use by female passengers only.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

British Airways

2. British Airways:

• Airlinetrends.com report that British Airways seem to have regained its footing

with several key innovative programs:

• GBP 5 billion investment – The five-year program encompasses several

key areas of focus. BA’s customers will benefit from new aircraft, updated

World Traveller (economy) and World Traveller Plus (premium economy)

cabins; a revamped first class; many improvements in in-flight service such

as more personable service and more flavoursome catering.

• To Fly. To Serve – this £20 million branding campaign kicked off in 2011 and

aims to reignite the passion and belief in the BA brand. The logo is found on

the BA coat of arms and on the uniforms of crew members.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

British Airways

• BA also introduced fleet and cabin upgrades.

• Onboard service innovation:

• A central tenet of BA’s business plan is to deliver outstanding passenger

service.

• BA’s crew iPads feature the ‘ Enhanced Service Platform’ which consist of

several apps that allow flight attendants to store and receive relevant

passenger details in real time (itineraries, meal preferences, and other data

that allow for more tailored service).

• Around 2,000 senior cabin crew are provided with an iPad.

• BA is also trialing a program on a some long-haul routes where a crew

member is designated as an onboard travel advisor.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

British Airways

• BA also seeks to boost cabin crew morale and reward outstanding customer

service with a ‘golden ticket’ scheme.

• The Height Cuisine Initiative:

• In 2011 BA partnered with English celebrity chef Huston Blumenthal to

come up with new revamped menus and innovative culinary approaches to

make airline meals taste better.

• Instead of using sugar and salt to flavour meals, BA now use umami-rich

ingredients.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

KLM

4. KLM:

• KLM Royal Dutch Airline is the seventh largest airline in the world in terms

of international kilometres flown and serves 135 destinations.

• Having a small home base, KLM’s strength lies in a tightly-knit worldwide

network.

• KLM has been an early adopter of self service options such as DIY luggage

check in; has a strong focus on sustainability (catering biofuel); is rapidly

expanding in China; aims to differentiate the passenger experience by

adding local Dutch touches; and is a pioneer adopter of social media.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

KLM

• KLM customers shave indicated that they appreciate the airline’s typical Dutch

character. To emphasise its Dutch origins, the airline partners with

contemporary Dutch designers for the creation of its onboard amenities.

• Deft Blue:

• Deft Blue porcelain is also part of KLM’s Dutch-inspired branding. Since the

1950s the airline has handed out small ceramic replicas of historical Dutch

houses filled with ‘genever’ (a Dutch style of gin) to passengers in Business

Class, that are still a popular souvenir item.

• Local food:

• Besides serving meals created by Michelin-starred Dutch chefs, KLM

organises ‘From Holland’ food and wine festival once a year.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

KLM

• For two months the airline serves Business Class passengers on long-haul

flights out of Amsterdam meals based on seasonal home-grown ingredients.

• Crowdsourcing – For the packaging of its sandwiches served on

European flights in 2012 KLM challenged design students to come up with a

design that reflected KLM’s distinct Dutch character. Three of the most

original designs were chosen by the airline’s Facebook fans.

• Serving Chinese customers:

• KLM aims to make Chinese customers feel at home – the airline has

localised elements of the onboard experience on flights to and from China.

Each flight has three Chinese-speaking crew onboard.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

KLM

• Social media:

• KLM has over 1.5 million Facebook fans and nearly 300,000 Twitter

followers. It has developed a reputation for launching innovative social

media campaigns.

• Sometimes the airline surprises passengers with a personal gift based on a

tweet or a Facebook profile.

• The airline also crowdsourced a commercial flight via Twitter and often asks

its Facebook fans to share their ideas and improve KLM products and

services.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

KLM

• Social seating:

• This is KLM’s most ambitious social initiative, the Meet & Seat social

seating scheme was launched in 2012.

• The service allows passengers to pick seatmates with similar interests

before their flight by linking their Facebook and LinkedIn profiles to their

seat number. Passengers must opt in for the service and can adjust their

privacy settings to reveal as much or as little information as they wish.

• ‘Meet &Seat’ is currently available for 13 destinations and CNN reports that

in the first 3 months after the launch, 2,200 people have shared their

profiles. The service is supplemented with Trip Planner – a new social

booking platform allowing Facebook friends to coordinate flights.

Source: Airlinetrends.com, 2012: http://www.airlinetrends.com/wp-content/uploads/2012/06/Innovative_Airlines_2012-airlinetrends.pdf

Sensory Design Innovation

• How to cater for the five senses in-flight:

• Touch - materials should be of natural substances, rich to the touch, or have

interesting textures (such as leathers, wood veneer or other finishes) “that can

give the passenger a sense of reassurance that a high degree of quality exists in

the surroundings.

• Sight - Mary Kirby, contributing to the APEX’ editor blog, explains that dynamic

lighting scenarios or “intelligent lighting systems” are increasingly being used for

aircraft cabins. This is important because lighting has an effect on behaviour.

Lighting can be used to reduce the feeling of jetlag and increase the passenger’s

sense of wellbeing. Lighting colours can also be used to emphasize different

aspects of the flight, such as boarding, take-off, breakfast, movie,

announcements. Boeing’s blue-hued Sky Interior cabin is an example of how to

create different ambient lighting scenarios using different colours and intensities.

Source: Apex Editor’s Blog, 22/03/2013: http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-

concept/

Sensory Design Innovation

• Smell – the olfactory sense is the most sensitive one, influencing people’s

mood as well as sense of well-being. Therefore different scents could be

associated with different aspects of the flight. One of the most successful

examples of the use of smell in design and branding in the airline industry

has been accomplished by Singapore Airlines. A scent called Stefan

Floridian Waters is infused into the hot towels they serve, the perfume used

by all the flight attendants, and subtly diffused into the cabin air.

• Sound – sound is still an expensive feature but has interesting potential.

For example, airlines can design signature tunes that play during the

boarding and deplaning parts of the flight. British Airways plays the Flower

Duet by Lakme upon boarding (and also in their commercials).

Source: Apex Editor’s Blog, 22/03/2013: http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-

concept/

Sensory Design Innovation

• Taste – designing for the sense of taste is primarily done through food and

beverages. As expected, food and drink have to be good to leave a lasting

impression on the passenger.

• Sensory design goes one large step beyond these core values of aesthetics

and ergonomics and takes a holistic approach at design. It puts the human

experience at the centre of its focus.

Source: Apex Editor’s Blog, 22/03/2013: http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-

concept/

Sensory Design Innovation

The frontend of a Boeing 777-200 was re-imagined to include a revenue-generating

casino lounge. The design aims to bring back the glamour of travel and to create a

social area where passengers could have a drink, watch TV, play blackjack and

engage in conversations with other passengers.

Source: Apex Editor’s Blog, 22/03/2013: http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-

concept/

http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-concept/

http://blog.apex.aero/cabin-interior/pictures-sensory-design-meets-aircraft-interiors-casino-jet-lounge-

concept/

Trolley Toppers to

‘Revolutionise’ In-fight Sales • Trolley Topper aims to improve considerably ancillary revenue by by

creating a shop window of all the goods on sale.

• The creators – Woodhouse Design – describe the product as “a clever

inflight display system that takes up no more lateral space than the width of

a trolley drawer”.

• Kenneth Griffiths, product design director at Woodhouse Design, explains

that Trolley Topper is like the displays positioned beside tills at

supermarkets, so it’s up to each airline to decide which products it will

showcase.

• The Trolley Topper comes naked for the airline to stock, depending on the

demographics of its passengers.

Source: Apex Editor’s Blog, 18/03/2013: http://blog.apex.aero/inflight-services-2/yettobelaunched-trolley-toppers-revolutionize-inflight-sales/

Trolley Toppers to

‘Revolutionise’ In-fight Sales • Bigger items, like bottles of spirits, sit in the actual drawer itself. Smaller

items like perfumes and makeup, sunglasses and toys, can hang in the front

and still be within the width of the trolley.

• Trolley Toppers can be also be used to enhance snack sales. Kenneth

Griffiths says ‘’ An airline can take on one extra pocket for sweets and crisps

and as the trolley comes towards the passenger, it’ll help boost impulse

onboard buys, especially if they haven’t had a chance to look through the

inflight magazine’’.

• Griffiths suggests that airlines use the blank space on the outside of the

pockets to sell advertising; the space is slightly larger than the size of a DL

envelope.

Source: Apex Editor’s Blog, 18/03/2013: http://blog.apex.aero/inflight-services-2/yettobelaunched-trolley-toppers-revolutionize-inflight-sales/

Trolley Toppers to ‘Revolutionise’ In-fight Sales

http://www.trolleytoppers.com/Trolley_Toppers_inflight_retail_Display/Trolley_Toppers_inflight_retail_display_system.html

The Business Jet

• In 2011 Boeing revealed its new business jet (747-8) which is reportedly the

‘latest technological jump for the company’ as well as the longest

commercial jet in the world.

• The cabin of the 747-8 is 6.1 meters wide and has up to 525 square meters

of floor-space - two or three times the size of an average house.

• The 747-8 Intercontinental is also the most expensive corporate jet in the

world. An empty747-8 costs around $300 million, but with a VIP fit-out the

price goes up to $500 million.

Source: CNN, 03/10/2011: http://travel.cnn.com/explorations/life/boeing-business-jets-816398

In-flight Cocktails

• Travel (2013) reports that serving in-flight cocktails is a trend that more and

more airlines are taking on board.

• Travel comments that the magic begins at the airport lounges. At Heathrow

Terminal 3 and passengers can choose from the Taste By Appointment

menu, selecting a drink from five flavour profiles (sweet, sour, umami, bitter

and salt).

• In the air, Virgin Upper Class passengers can enjoy cocktails served seat-

side. A sleek onboard bar allows passengers to get up, stretch out and have

a chat with other passengers.

• Travel reports that Virgin is leading the way but is not the only airline

embracing in-flight cocktails.

Source: Travel, 29/03/2013: http://www.telegraph.co.uk/travel/ultratravel/9960636/In-flight-cocktails-Airlines-latest-innovation.html

In-flight Cocktails

Airlines serving cocktails in the air:

• All Nippon Airlines: In first- and business-class.

• British Airways: In first- and business-class, and on the all-business-class

London City to New York JFK service.

• Cathay Pacific: In first- and business-class.

• Emirates: In all classes.

• Singapore Airlines: In all classes.

• Virgin Atlantic: In Upper Class.

Source: Travel, 29/03/2013: http://www.telegraph.co.uk/travel/ultratravel/9960636/In-flight-cocktails-Airlines-latest-innovation.html

Flying into the Future

• Jude Gomila, the co-founder of HeyZap, a gaming company, suggests nine

core areas that could be improved to improve the passenger experience.

• For example, Gomila states that airlines should learn from the shipping

industry and re-engineer planes so that people are pre-loaded into detached

air-conditioned cabins that would then be rolled onto the plane, thus

allowing passengers to “board” before the plane even arrives.

• More realistic ideas involve better seat design, including meshed chairs,

more localised temperature controls that are operated from a personal

display, and reading lights that don't spread onto a neighbour’s space.

• Gomila believes that armrest controls should be removed in favour of

Source: The Economist, 29/03/2013: http://www.economist.com/blogs/gulliver/2013/03/airline-innovation

http://www.economist.com/node/21527035

Flying into the Future

• a high-resolution touchscreen and using magnets rather than a turn fob to

secure tray tables.

• Some of these ideas, or similar ones, appear to already be more than

plausible, judging by the finalists of the Crystal Cabin Award 2013 to he held

in Hamburg in April.

• Among the 21 products and concepts under consideration are a “stylish and

robust capacitive touchscreen” by Dornier Technologie Systems; a

lightweight, self-cleaning seat table integrated into the armrest by English

designers Acro Aircraft Seating; and ceiling panels reduce drafts and cabin

noise while improving mood lighting.

Source: The Economist, 29/03/2013: http://www.economist.com/blogs/gulliver/2013/03/airline-innovation

http://www.lowyat.net/category/news/page/3/

http://news.cnet.com/8301-1023_3-57577270-93/april-fools-2013-from-twttr-to-google-nose-to-nokias-microwave/

Eye Tracking and Gesture

Control

• The eye-tracking and gesture control system is controlled by a combination

of the passenger’s eye movements and hand motions.

• Passengers can navigate through the seat display menu options and select

entertainment and information preferences.

• The use of Eye Tracking and Hand Gesture Control technologies creates a

MMI (Man-Machine Interface), so that the passenger doesn’t have to look

down at a remote controller when making decisions.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Lufthansa Technik's Nice HD

System

• The HD system includes personal HD video at seat locations via ultra-thin,

and light-weight 7- or 10-inch pop-up HD displays.

• It offers several media interfaces (USB, Apple, HDMI), a multifunctional

"nice" HD media center unit that includes a Blu-ray player, media server,

Audio/Video on Demand (AVoD) server and a map server.

• All cabin functions can be intuitively controlled via a scroll-wheel with a

corresponding animated user Interface, a touchscreen control or a wireless

application on their iPhone or iPad.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Paperclip Design's Checkerboard

Convertible Seating System

• The system is designed for the short-haul market.

• The Checkboard is convertible between economy and business class

configurations, with the latter having extra width and an additional 8 inches

of legroom.

• CNN (2013) suggests that this gives airlines the the flexibility to adjust

cabin configuration for each flight to match variability in demand, allowing

them to maximize revenue.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

HAW Hamburg's Big Lavatory

Concept

• CNN (2013) suggests that the BigLavC will be the first aircraft lavatory on

market customized to the needs of obese passengers.

• The new diagonal position of the toilet improves conventional aircraft

lavatories through increased comfort and space.

• A new toilet seat makes it safer and easier for wheelchair users to change

between wheelchair and toilet seat.

• CNN comments that for the first time it is possible to earn money with the

integrated infotainment display in the lavatory, which can be used for short

commercials to support sales during flights.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

MERU's TravelChair

• The TravelChair offers comfortable, postural support for severely disabled

children.

• Weighing 6 kilograms, it fits in most airline seats and is secured with a strap

around the host seat. The chair also allows for the seat lap belt to be used

in the usual way, meeting aviation safety regulations.

• The TraveChair also folds in half to fit into the overhead locker when not in

use.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Zodiac Seats's Reversible Seat

• The Reversible Seat allows passengers to orient their seating in accord with

the size of their group. The underlying mechanism is designed to allow the

orientation of the seat to be reversed quickly and with minimal effort.

• The mechanism allows the flight crew to swing the backrest from the back

of the seat to the front while simultaneously reversing the angle of both the

backrest and seat cushion, and sliding the base-frame forward to enlarge

the shared foot area between the facing seats. A locking feature prevents

the seat from sliding into a new position unless intended.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

TU Delft's Tray Table Cabinet

• The table cabinet is a substitute for regular tray tables – it can be can be

opened and passengers can store their phone, tablet or wallet in dedicated

compartments.

• The main features of the tray table cabinet are: compartments that have

space for at least a tablet, smart phone, wallet and keys; protective and

fixating foam rubber; openings for headphone wires; see-through bottom to

prevent passengers from forgetting their belongings and a USB-charging

output.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Boeing's Insulated Galley Cart

• The Insulated Galley Cart (IGC) allows airline operators to load cold food at

a catering facility and keep the food cold, both in transit to the aircraft and

for the length of the flight.

• The IGC eliminates the need for onboard refrigeration systems.

• This change in managing refrigerated food storage dramatically reduces

aircraft weight and airline operating costs, and improves aircraft

performance.

• In addition to monetary benefits, the weight savings reduce CO2 emissions

by hundreds of tons per year.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Lufthansa Technik's

ColourCurve

• The ColourCurve is the first non-electrical system that can be shaped to

follow any form, adapted to any interior design.

• Flowing shapes can be supported with 20 colors.

• This new ColourCurve consists of only two parts instead of the six of the

former system.

• One strip fits all, thus customers don't need different strips for galleys and

aisles, installation is easier, and spare parts are reduced. ColourCurve

achieves up to 8 kilograms/35% weight reduction (compared with former

products) over the life of the aircraft.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

Row 44's Live TV to Passengers'

Devices

• Row 44's Inflight WiFi Live Television lets passengers watch live TV

channels inflight on their smart phones, tablets, laptops and other Wi-Fi

devices.

• At the time of the product's roll-out in July 2012, Row 44 and launch

customer Southwest Airlines offered passengers a choice of several live

channels: CNBC, MSNBC, NBC Sports Network and others.

• This service can be made available to passengers as a separate Wi-Fi

offering, independent of Internet access.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4

TU Dresden's Concept Cabin

• Heavy mechanical parts are replaced by intelligent, flexible materials. Large

screens are nothing more than thin films.

• Hybrid OLED layers convert light into energy and small units and sensors

harvest energy by themselves through light and vibration - sufficient energy

for wireless communication with the IFE system.

• To give the passenger an impressive flight experience, the sidewall panels

are expanded with many 3D displays that provide a great picture of the

environment. Additionally, the view of the environment will be supplemented

by digital information about the region, of the mountains or the ocean below.

Source: CNN, 03/04/2013: http://travel.cnn.com/12-flight-innovations-keep-eye-out-013216?hpt=hp_c4