A persistent theme at the ASA Leadership Forum chief executive panel was whether the industry will extract true learnings from the Covid pandemic. “The worst is behind us, but I am also worried about summer 2023, and my biggest concern is that there will not be much learning from this, not much will change,” said Jost Lammers, chief executive of Munich Airport.
“The biggest lesson is that we are the most business-critical part of the airport system… and there is an opportunity for the industry to reset ourselves,” said Warwick Brady, chief executive of Swissport. The industry was stunned at the amount of disruption caused by the lack of staff during the ramp-up, he said.
Put simply, part of the reset is that handling services cannot continue to be undervalued and so cheap. “If you need a quality service you need to pay the right price for it,” said Brady. “My biggest wish is to push for higher prices at the end of the day,” said Lammers. “We need more money in the system for ground handling to build up quality. Somehow, we need to find a way to do this jointly because the element of quality needs to be much higher.”
Steve Allen, chief executive of dnata, is fearful that while this might be the result of a reset, “in two years’ time a new handler could be set up that comes in and undercuts everyone.” It is important that standards are established so that the bar to enter the market is very clear, for example on insurance coverage, he added. “If we allow a race to the bottom again then we are all in trouble.”
Airports have a role to play when looking at their licensing regimes, and should license responsibly, said Brady. “If an airport opens to five or six ground handlers then everyone loses money,” he noted.
According to Aviapartner managing director Richard Prince: “We need to restore a level of pride and respect to our industry. This means turning a transaction at an airport today into a service. If we don’t, lowcost wins and we become a transaction industry. We’ve got to bring back that sense of service.”
The way forward is “long-term partnerships where we can invest”, said Allen. “We need to move away from transactional three-year contracts to seven-year investment cycles,” said Prince.
“The opportunity we’ve got is to accelerate the process of outsourcing – leave the ground handling to the professionals,” said Allen. Some carriers have said the disruptions have caused them to revisit insourcing. “Don’t allow the industry to go into reverse,” warned Brady.
