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Economic Impact Of ATC Jeff Poole, March 2007

Economic Impact Of ATC Jeff Poole, March 2007. Ö. Ö. We are a US$450 billion industry. We support US$2.9 trillion in economic activity. Air transport is critical to the global economy. needs leadership. But an industry in crisis since 2001. Ö. Ö.

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Economic Impact Of ATC Jeff Poole, March 2007

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  1. Economic Impact Of ATCJeff Poole, March 2007

  2. Ö Ö We are a US$450 billion industry We support US$2.9 trillion in economic activity Air transport is critical to the global economy

  3. needs leadership But an industry in crisis since 2001

  4. Ö Ö 2001-2005 airlines globally lost over US$40 billion 2006 expect losses of US$1.7 billion Since 2001: series of crises that changed air transport

  5. Airlines improved their bottom line even as fuel pricesskyrocketed

  6. The industry is moving in the right direction

  7. Ö Ö Ö Labor productivity increased 33% Sales & distribution costs dropped 10% Non-fuel unit costs reduced 13% Since 2001…

  8. Ö Ö Globally ATC unit costs raised with 9,4% The costs of ATC inefficiency are too high But it’s a bit early to celebrate…

  9. Ö Ö Ö Ö Safety Performance Capacity Cost Efficiency ATC impacts an airline in many ways

  10. We need to ensure the right balance SAFETY CAPACITY PERFORMANCE COST-EFFICIENCY

  11. Ö Ö Financial Performance Operational Performance Both Impact Our Bottom Line We need a continuous focus on Improved Performance

  12. Financial Performance:

  13. Ö Ö Global USD 42 billion bill 11% of average airline cost base The global Airport & ATC share of the costs is large:

  14. Ö Ö Ö Transparency Stakeholder Engagement Efficiency We experience major global differences in:

  15. And major ATC cost variations: From USD 0,04 per KM to USD 4 per KM of controlled flight

  16. Ö Ö Ö Ö Control operational costs Invest wisely Harmonize Services Control overhead Efficiency:

  17. Ö Ö Ö Radar Investment $ 37 mln ADS Investment $ 10 mln Annual operational benefits: $ 11 mln Hudson Bay Example Invest Wisely:

  18. Ö Ö Ö Lower investment Operational benefits Future technology The choice for ADS-B:

  19. Ö Ö Proper Cost Benefit Analysis Stakeholder Engagement Avoided Investment,USD 22 million…… through:

  20. Ö Ö Ö Airline involvement will lead to successful implementation Involving airline expertise will lead to more efficient investments Airlines are customers and are directly affected Stakeholder Engagement

  21. Ö Ö Ö Ö Justification is required that charges are cost based Major investments should be justified and required Airlines should exactly know what they pay for Transparency should lead to improved benchmarking Transparency

  22. OperationalPerformance:

  23. continues to hurt airlines The high price of oil

  24. The industry fuel bill rose from… 2001 fuel bill:USD 43 billion 2005 fuel bill:USD 91 billion 2006 fuel bill:USD 115 billion

  25. Flying Time = Money Which Reinforces:

  26. There are multiple ways From A 8200 nm 9100 To B

  27. Ö Ö Saving 43 Minutes Saving 8400 kg of fuel With Major Cost Differences…. 8200 nm

  28. Move from this……

  29. To this……

  30. Straighter routes and removal of barriers are of great importance to an improved performance

  31. Algiers ORAN UM998 NODJAMENA MAIDUGURI Ö African Red Carpet express routes annually save the industry USD 7.6 million in costs UM731 RUDAS GBV Pretoria

  32. Ö Ö Ö EUR 1 billion in delay EUR 1,5 billion in inefficiency EUR 7 billion in provision costs The European Challenge EUR 9,5 billion in ATM costs

  33. Ö Ö Ö EUR 0,5 billion airspace redesign EUR 0,3 billion capacity planning EUR 2,5 billion consolidation EUR 3,3 billion in possible improvement The European Challenge

  34. Military operations are also affecting performance……….

  35. Ö Ö Ö 600 NM Restricted Airspace NAT traffic heavily impacted Airlines lost USD 1,9 mln In one day One Military Atlantic Exercise

  36. Ö Ö Ö Ö Harmonization of airspace Standardization of Infrastructure Consolidation of providers Lower Unit Costs The Global Performance Challenges

  37. Ö Ö Ö Drive cost reduction and efficiency improvement with more speed Agree to challenging efficiency targets Work together with airlines as business partners in long term strategies and investments What can ANSPs do?

  38. Ö Ö Ö Ö Ensure independent regulation Establish a level playing field Set clear efficiency targets Remove obstacles What can Governments do?

  39. Let’s improve our performance as an industry IATA is here to help

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