CAPA Airline Leader Summit

Dublin, Ireland
11-12 May 2017
DAY 1 – THURSDAY 11 May 2017
08:00 Registration
09:00 Chairman's Welcome
CAPA – Centre for Aviation
, Executive Chairman, Peter Harbison
09:10 Welcome Address: Dublin Airport Authority, Chief Executive Officer, Kevin Toland
09:25 Introduction: CAPA Overview of the disruptive forces at work, in the regulatory and big data areas 
CAPA - Centre for Aviation,
Executive Chairman, Peter Harbison [Download Presentation]

This discussion will take the form of a debate. Speakers will alternate between the opposing propositions while delegates will be encouraged to actively participate. 
Part l:
Ownership and control rules will be discarded (with thorough disruption of the aviation system)

Despite decades of inertia, new forces are at work, operationally and commercially that are coming together to disrupt the airline industry. From a range of sources, momentum has been building that signals the potential for a remarkable evolution in international ownership restrictions.

But changing the regulatory order of things is extremely complex, even assuming willing parties. Underpinning the transactional bilateral approach, the persistent role of “ownership and control” clauses in the myriad of bilateral agreements has dogged any prospect of substantial disruption.

Joint venture and bilateral partnerships have become enormously important to the success – and even survival – of major airlines. Limited by ownership and control rules, airlines have constantly sought options to expand their global presence. The multilateral alliances have gone some way in that respect, but the intensification of international long haul competition has greatly enhanced the value of close bilateral ties.

A new disruptive influence has appeared in the marketplace, with an abundance of aviation bilateral “currency” at levels never previously imagined. China has emerged, and its outbound tourists are delivering massive economic benefits to every country in which they land. The magnitude (and sudden appearance) of China’s currency asset is unprecedented. Until recently, China has not been a principal voice in the formulation of international policy. Instead it has been content to rely upon the historical constraints of the bilateral system, protecting its airlines as they achieve a level of international competitiveness. As it stretches its wings in the aviation market, China’s influence is growing rapidly.

Secondly, there have already been a number of incursions into the sanctity of ownership and control provisions. These include (1) the proliferation of cross-border JVs, which have been particularly functional in Southeast Asia as LCCs like AirAsia have sought to establish themselves across the region as Pan Asian airlines; and (2) the revival of significant minority shareholdings in foreign airlines. Etihad accelerated this trend, which is now being elaborated multiple ways.

To disrupt the complex regulatory structure that has survived 7 decades is no easy task, but most of the industry believes it needs to be, at least insofar as the deadlock of “ownership and control”. That said, there are clearly cracks appearing in the fabric.

Moderator: John R. Byerly, Consultant, John Byerly

For the proposition that ownership and control restrictions will be disrupted:
 European Aviation Club, Chairman, Rigas Doganis
Seconded: BKH Aviation, Chairman, Barry Humphreys

Against the proposition:
: Aviation Strategy & Concepts, Managing Director, Ulrich Schulte-Strathaus
Seconded: DVB Bank, Senior Vice President Aviation Research, Albert Muntane Casanova

Audience participation will be encouraged and the audience will vote on the various issues raised.
11:00 Coffee & Networking 
11:30 Boardroom Session: Investing in airlines and travel across borders - How valuable is equity in the search for partnership solutions?

Etihad's investment in Alitalia, airberlin, Jet Airways and five others, as well as AirAsia’s cross-border JVs have helped redefine the definitions of partnership and alliance.

HNA Group, which has bought stakes in LATAM Group, Virgin Australia; Qatar Airways, with investments in IAG and LATAM; Delta in Virgin Atlantic CIT Group on the aircraft side and Hilton on the hotel side.
For now it is mostly airlines investing in other airlines, where potential synergies arise.
  • Will there be more international investments in airlines?
  • Is the China investment model (investing across various travel brands) another way of the future? eg can airlines help to grow the travel category, and thereby move more people around the world
    According to the WSJ, Chinese overseas investments have hit USD199 billion in 2016.
  • What role will cross-border joint ventures - such as those in Asia Pacific, typically with LCCs - play in future de facto inroads into O&C constraints
ChairmanJohn R. Byerly, Consultant, John Byerly

Third Parties:
  • ACI Europe, Director General, Olivier Jankovec 
  • Aeroflot, Deputy General Director for Strategy & Alliances, Giorgio Callegari 
  • airBaltic, CEO and Chairman of the Board, Martin Gauss 
  • Aviation Strategy & Concepts,Managing Director, Ulrich Schulte-Strathaus 
  • European Aviation Club, Chairman, Rigas Doganis
  • European Commission, Director General MOVE, Henrik Hololei 
  • Irish Aviation Authority, Chief Executive, Eamonn Brennan
  • KLM, President & CEO, Pieter Elbers 
13:00 Lunch
  Part II: Big data and disruption - 
How will third parties disrupt selling travel? And the future role of Big Data in the airline system
14:00 Evolution, Not Disruption: Delivering API Distribution
Global Head of Product & Marketing, Air Commerce, Ian Heywood
14:15 Google Flight Search and Why it’s Bad for Airlines
CarTrawler, CTO, Bobby Healy [Download Presentation]
14:30 Disrupted by Data - How Big Data and Analytics are Shaping the Industry's Future Now
, GM and Global Head of Travel & Transportation, Paul Pessutti [Download Presentation]
14:45 Q&A with CNN, Anchor, Richard Quest
15:00 Coffee & Networking
15:30 Panel Discussion: A big discussion about Big Data in two sessions
Session 1: How will intermediaries & third parties disrupt selling travel?

If Airlines and intermediaries are to retain relevance in the overall supply chain, they will need either to adapt their models enormously or to forge deep associations with the channel of disruption at the marketing and sales/retail end of the spectrum.
These can be modified versions of existing distribution models or wholly new paradigms. Equity and otherwise, these liaisons will probably be with the same data organisations that are fomenting the airlines’ disruption, such as Google, Facebook, airbnb and others who will appear in coming years. In effect airlines will need to adapt to behave and act more like world class retailers if they are to avoid increased risk of marginalisation and commoditisation.
Yet even embracing the current, and future travel industry implies increasing marginalisation. For much of the world, travel has simply become one of a range of consumer options, interchangeable and competing with buying a new laptop or mobile device, going to dinner with friends, or to a football match.
Understanding the changing and holistic nature of consumer behaviour just by analysing its own data is well beyond the range of airlines.
The massive new aggregators live and die on that data and are able to combine it with rich travel profiles to complement it; they will not be slow to exercise their power. In this respect even the most sophisticated data sets available to airlines from their own FFP’s are just pale shadows. When embracing a traveller’s “total” annual travel data picture, a single airline, partnership (or even alliance), can only touch one small piece of the jigsaw. For airlines to avoid commoditisation and marginalisation, they will need new pragmatic alliances that allow access to broader and new forms of data. What form these will these take – for example the profile of the other partners needed, who will dominate the partnerships – and even the very role that airlines will play, are all in the mix here.
It seems inevitable that these massive aggregators, who own more data on travelling individuals than airlines and intermediaries combined, cause airlines to lose control of pricing, revenue and yield, just as hotels have lost control to OTAs and HBAs.
Can airlines have any hope of emerging as winners in this data revolution? Innovation, thinking outside the box, will be critical. That will need management boards with different profiles, and new managements, who understand more about retail and data than about buying and flying big boys’ toys.
Even if it is possible, getting from here to there will be a massive leap. The debate itself will be a powerful disruptive force in its own right. This session seeks to determine the likely shape of the way third party will evolve.

Moderator: WebinTravel, Founder & Editor, Siew Hoon Yeoh [Download Presentation]
  • Aeroflot, Deputy General Director for Strategy & Alliances, Giorgio Callegari
  • CityJet, Executive Chairman & CEO, Patrick Byrne
  • Datalex, CMO, Ornagh Hoban
  • Flybe, CEO, Christine Ourmieres-Widener
  • Malaysia Airlines, Group MD & CEO, Peter Bellew
  • Travelport Digital, CCO, Fergal Kelly
16:30 Panel Discussion: A big discussion about Big Data in two sessions
Session 2: The future role of Big Data in the airline system
Whereas Session 1 has looked at the likely evolution of the present system, and the issues involved in that, Session 2 will cover the new external forces that are beginning to emerge that will challenge the fundamentals of the airline system. These potential challenges to the system are emerging very rapidly. As more organisations invest heavily in big data and in using that data to develop granular profiles of millions of travellers and would-be travellers, the old arguments about who owns the passenger become moot. Amazon for example has spent USD3 billion in the past three years in the data analytics area. For individual airlines - even the more enlightened ones - to engage and invest on this scale is unthinkable. This panel will seek to expose in detail the nature and scale of these developments as they affect the airline industry, as a preface to tomorrow’s boardroom session, which will explore potential airline responses to the new forces.

Moderator: Troovo, CEO (and President of ACTE), Kurt Knackstedt [Download Presentation]
  • Amadeus, Senior Value Engineer, Travel Intelligence, David Stoyle
  • Booking.com, Director Partnerships EMEA, Toni Raurich Marcet
  • easyJet, Group Director Strategy & Network, Cath Lynn
  • Farelogix, President & CEO, Jim Davidson
  • IAG, CEO, Willie Walsh
  • Skyscanner, Director Business Development, Hugh Aitken
17:30 End of Day
19:00 Pre-Dinner Drinks in Ballroom Foyer

Dozens of industry leaders will debate the likely impact of such global issues. Delegates will be challenged to participate actively.
Powerscourt Dinner Debate

Part III: What do Brexit, Trump and rising nationalism mean for aviation?

Hosted by CNN's Anchor Richard Quest