How can the aviation industry come out of the Covid 19 crisis successfully?

By Manoj Srivastava, Director – Aviation Technology, Lorhan IT

We should not forget that Airlines are selling only services and not a product. Indian aviation industry has been running since last three decades but unfortunately, it is still not matured enough to survive even few days without flying. You take any past example whether it was dot-com bubble burst or 911 or SARS, in any such natural calamity situation, airlines industry get affected 1st and revived in the last, simply because the airlines industry works in very low profit margin, which can’t afford even small jerk to hit the business – COVID may go in next couple of weeks’ times but fear factor of COVID will take few years to go or until everyone got vaccinated,

Today, most of airlines are on ventilator, some of them already filed chapter 11 for bankruptcy i.e. Air Mauritius, Virgin Australia, JetSuite and no surprises if any Indian carrier may also declare for the bankruptcy, but the positive side is if Airlines can survived on a ventilator for some time, will be deserve for the winner to enjoy rest of the passenger traffic.

Social Distancing
Social distancing is one of the best way to avoid spreading-out coronavirus, especially in public place. DGCA already prepared a blueprint and advised to all Airlines, Airports operators to strictly follow the procures to handle the passengers, sanitizer machine installed in airports at various touchpoints, Airports, Ground Handling Agency’s staff, Security staff, immigration staff may be wear disposable PPE Kit, special Pandemic Disaster Unit may be open with doctors, specialist, corona testing facility for testing and handling corona suspected passengers, medicated face-mask and glove may be distributed while issuing a boarding pass.

Thermal gate to be installed for frisking at security checks, check-in baggage to be sanitised, baggage trolley to be sanitised after each use, UV sanitizer machine will be installed at the entry, security, and boarding gates, as far as Aircraft is concern, full sanitizing is recommended and deep cleaning needed after every landing/takes-off. As per new guidelines middle seat will be blocked but it is not viable simply because keep middle seat blocked neither maintain the recommended distance between aisle and window seat nor good for airlines load factor.

Industry need to travel digital journey
COVID has press the pause button, which is not good sign for any industry but I think this pause force us to think differently and stay away from doing conventional way of the business, revamp complete business process, use technology as much as possible and integrate all application, infrastructure across Airlines, Airports and Service providers systems.

In other words entire customer journey should be paperless, all associated business functions could be digitally processed using ML/AI and RPA across Airlines systems to Airports check-in, frisking and boarding etc. system can be integrated and process passenger’s information/data across the network in real-time mode. I strongly recommend that Airlines, Airports, service providers and concern regulatory agencies – DGCA, MoCA, MHA, AAI, ATC, BCAS, DOT, MeitY and others should jointly discussion and developed clear IT roadmap and prepare detail blueprint to integrate each services across all touchpoints without compromising national and passenger safety and security.

In this context Ministry of Civil Aviation already taken an initiative and have planned to launch ‘DigiYatra’ app which will process passenger’s information based on facial recognition, ‘DigiYatra’ will stored passenger information and kept in centralise database/NIC systems :-
Departure Gate: Face reading device will retrieve DigiYatra data from central server and validate passenger booking.

Check-in: Face reading device (fixed / portable) will read and retrieve valid booking and issued a boarding pass, self-check kiosk may also have face reading and validating features.
Security Check: UV gate scanner will scan and read passenger face/thumb impression and security check status will updated in DigiYatra records.

Check-in Baggage: RFID enabled baggage tag to be tagged with check-in baggage. So that check-in baggage can monitor across the journey from departure to arrivals.
Boarding Gate: Auto boarding feature could be enabled, e-gate will read and revalidate passenger data/status etc.

e-Passport: e-passport will enable self-immigration processes.  Digital transformation is not new normal only ‘acceptation’ to be accepted. There are plenty of technology and application available globally and successfully implemented and running in various international airlines and airports, we should also follow the same route, and get it implemented in all Indian airports as early as possible so that we could resolve social distancing issue easily.

WFH – fasten your belt
WFH – ‘Necessity is the mother of invention’, today technically we are fully equipped to work from home and most of IT MNCs already following such practice since very long time, WFH may not fully applicable for every industry but partially can be implement in all industry.

WFH may increase the airlines productivity as Airlines operates in 24 x 7 x 365 days, officially WFH culture may be adopted in aviation industry specially in Airlines, except flight operations, aircraft maintenance or any other department where physical presence required, however management, employees and service provider may occasionally can WFH concepts subject to technical feasibility and cybersecurity.

Way forward strategy for survival and revival?
Indian civil aviation industry is the fastest growing industry and expected to be the world’s 3rd largest by 2024. As per DGCA Indian domestic passenger traffic increases by 3.74% in 2019 in compare to 2018 traffic, the Indian Aviation sector currently contributes $72 bn to GDP, but due to COVID lockdown effect Indian aviation industry could be facing 24-25K revenue loss, we can’t predict what figure and what things to be changed in new normal but expected to take 18-20 months to recover.

Corona pandemic wrote a new normal book which will change our lifestyle in coming age, probably WFH may not encourage to travel, but once vaccine invented and easily available in the market than people may start traveling for business trip initially, followed by tourism, personal trip, whatsoever situation maybe but once lockdown open and the government announced to fly, Airlines will start flying initially metro/business sectors only i.e. Delhi, Mumbai, Kolkata, Chennai, Hyderabad, Pune, Ahmedabad, etc. and keep monitoring current load factor and additional demand to connect other cities, likewise, Airlines gradually open and start flying other cities subject to demand and frequencies, airfare will be increased in many folds, possibly once again a common man can’t afford to fly.

Today, all airlines are in ventilator, some of them already filed chapter 11 for bankruptcy i.e. Air Mauritius, Virgin Australia, JetSuite and no surprises if any Indian carrier may also declare for the bankruptcy, but the positive side is if Airlines can survived on a ventilator for some time, will be the winner of rest of the time.

What are the key lessons that have been learned?
We should know the airline industry is very highly regulated and closely monitored by government agency DGCA, Airlines can’t run the business in isolation, every step they need to follow certain rules and regulations laid down by DGCA, IATA/ICAO/FAA guidelines. If airlines wish to change something in the aircraft, could be a small change in nature still airlines must take airworthiness certification before flying.

Airlines business is license-based business, even some of the position hold license issued by DGCA i.e. caption, commander, crew member, dispatchers, AMEs, flight instructor and auditors, generally, start-up airlines may take minimum 12-15 months to launch, before planning to start airlines business, following business Mantra should be remembered:-

* Passion towards running the airline business.
* Airlines business is a cash-intensive and low-profit margin business.
* Do not expect immediate or short-terms Return-of-Investment
* Once launched make sure Aircraft should be in Air (maximum utilization).

Holding of the above mantra in the mind start preparing the following ingredient to start the operation: –
* Prepare a strong and realistic 5-year business plan with projected revenue.
* Professionally evaluated business plan
* Appropriate selection of equipment / Aircrafts
* Optimal Network Planning and strategy
* Best and economical MRO strategy
* Deploy adequate and minimum resource to start the operation
* And cash reserve for unforeseen contingency events.

Apart from the above 7 basic ingredients, 7 major Key performance indicators should be adopted to sustain the operation in the longer run: –

* Optimum Utilization of Aircraft/s
* Security and Safety of the travelers, now add ‘Hygiene’
* On-time performance – OTP
* Passenger load Factor – PLF
* Better Revenue Management and Optimization – RSPKM / CSPKM
* Continuously reduce operating cost
* Outsourced non-core functions and operations, only focus to run the Airlines.

Mostly, Airlines landed-up with huge loss or closure situation due to wrong planning or missing of above 7 ingredients with 7 KPIs.

Today, you can see, as corona pandemic start spreading out, airlines couldn’t wait a single day and start laying-off employees, cutting salary, can’t afford to survive even for a week or so, because of wrong planning, no contingency fund created to deal with the situation.

In the last but not least, I am optimistic and expecting very soon we will come out from the current situation and one more time will fly and touch the sky with our maximum.