Airlines: Willie Walsh & Sir Tim Clark interviewed.

Airlines: Willie Walsh & Sir Tim Clark, interviewed.

Last year I attended a question and answer session at the World Travel Market.

It involved Willie Walsh, CEO of IAG, which includes British Airways and Sir Tim Clark President of Emirates Airlines.

Quite a bit has happened since November 2016. British Airways have had two computer crashes, greatly upsetting their passengers. Also, a couple of strikes and it is not clear whether the cabin staff issues have been resolved.

We have lost Monarch Airlines, a sad loss, it was a great airline.

Emirates have continued…….

Willie Walsh considered that alliances will be coming to an end, ‘One World’ , ‘StarAlliance’ etc. Quite likely there would be mergers instead.

The introduction into the market of low cost long haul airlines might well shake things up. These include Norwegian and Scoot etc.

Willie Walsh thought that business models were changing and a label means nothing. Aer Lingus which is now part of IAG, makes a profit on the Atlantic with low cost fares.

However Norwegian runs on small margins, of course, pay for most things on top of the original fare.  

Michael O’Leary at Ryanair is also looking at short haul.

Tim Clark of Emirates claimed that he had had a difficult year, as there has been a slow down in Africa and South America.

There is a lot of capacity out there, China will continue to be busy. Willie Walsh continued that they had a good year and for him the industry is getting better. Would he say that now ?

They both agreed that Air France and KLM may have difficulties as they tend to be resistant to change. In other words, they don’t intend to take the cheap route, - yet ? Running on commercial lines as against political ones was seen as being essential. Was there a hint there ? On purpose ? Willie Walsh claimed he had a better cost base than Air France, was that a reference on the difference between UK and EU practices ? On the other hand KLM has always had strong leadership. A indication that they would adapt and survive.

America would always be a big market even with a strong dollar. Three hundred and thirty million people help. They both agreed that the US carriers were making phenomenal profits. 

Sir Tim Clark would really like an upgrade of the Airbus A380, his main aircraft. Newer engines and a fuselage stretch, Airbus do not want to know apparently.

With regard to the Third runway at Heathrow, Willie Walsh thought a cost of £800 million for a multi-storey car park, totally excessive. That might be £17,000 per space, ridiculous he thought. I don’t doubt he is right. They both made the point about costs, ignore that and one will be in trouble. Terminal 5 was way to expensive to build !

There was no doubt they both considered costs too important to be taken for granted. The only problem, is, that conflicts and politics around the world have a major impact.

From Autumn 2017, it can be seen that Tunisia, Egypt and Turkey and their problems are already hitting some airlines hard. Witness the demise of Monarch Airlines in the UK, they regularly flew to these destinations. Now everybody tries to squeeze into the same markets.

The author would like to be positive……..but ?

Willie Walsh

Sir Tim Clark & Willie Walsh at the interview