FLYING high

Transport and aviation will continue to play a major role within the broader diversification strategy of the Kingdom, and Swissport is ready and willing to do its part.

In late 2018, Swissport won new contracts from KLM and IndiGo in Saudi Arabia. What is the significance of these deals within the role Saudi Arabia plays in your regional corporate strategy?

Big-name carriers’ trust in Swissport is the consequence of three years of developments and efforts by the whole Swissport team. The two deals, although different in nature, are part of a comprehensive strategy Swissport is undertaking in the region. KLM adds value in terms of brand recognition; the Dutch carrier is a reputable airline and was the first European one to start traffic in Saudi Arabia. On the other side, the deal with Indigo needs to be seen within the context of the broader Indian market and of the carrier itself. Indigo is the largest domestic carrier with some 200 aircraft. It is profitable, highly recognized in the Indian subcontinent, and has plans to enter the European market, and Swissport could bridge this step, as we can handle the same carrier in different stations, raising the nature of the deal at the strategic level.

“Big-name carriers’ trust in Swissport KSA is the consequence of three years of developments and efforts by the whole Swissport team.”

How do you expect the current restructuring of the aviation industry in Saudi Arabia to impact international and local private sector players in the industry?

As the country seeks to position itself as an efficient transfer point, the Kingdom will need to be open in any direction. Air transport is a network that needs to take into account its surroundings and internal aspects. As GACA moves back from being an operator to a regulator, there will be clear mandates of the difference between the two roles. This will increase transparency and the level of specialization within a framework of standardization, and eventually will lead the way for the private sector’s practices to be enhanced. This has generally been the methodology of choice in Europe and North America, with successful results on all sides, especially customers. In Saudi Arabia, it will take more time. Private airlines were only established 15 years ago.

How have customers’ expectations evolved, and what is the key to ensuring satisfaction, while maintaining profitability?

With regard to airline demand, 20 years ago, full-fare economy class was the business mainstay, though today we have a high-volume, low-cost market segment. Consumers are searching for the cheapest fare, without paying too much attention to the level of service. In this context, though, fees must remain cost-based, so that reserves are being built on investment programs; however, at the same time, a premium segment willing to pay for premium services has grown at the same speed, with the standards of service between business and first-class converging. As such, service providers will move toward a menu of services, where consumers can construct and select from a wide array of services around the trip itself, which eventually are all factored into airport revenues.

How will the integrated approach benefit from the advent of new IT upgrades to impact the operations of new airport infrastructure?

Technology is a key enabler in aviation, and IT in particular is the DNA of infrastructure as an enabler for service providers. The new Jeddah airport terminal will have a different value proposition, with integrated systems in particular. Most modern systems include concepts of integrated airport operations centers where all parties come together to contribute to the overall operational success and stability of the airport to achieve profitability. This integrated approach will allow players to capture data directly into coordinated systems, eliminating the risk brought by having multiple players processing the data. The battle of the future will be on the ground, where the limitations of infrastructure are. Aircraft and ground service equipment have a life cycle of 15-20 years, thus international players with the ability to rotate assets will have a key advantage to benefit from the growth of the industry. ✖