Aviation 3.0

The Next Phase

Following parts 1 and 2, there's no doubt that in the century and a bit since the commercial aviation industry began, the successes have far outweighed the failures. Look at some of the examples.

By any measure, the commercial aviation industry has been staggeringly successful.

The industry's staggering technical and development achievements are one thing, but there's so much more. The commercial aviation industry contributes to about 35% of world trade by value, close to three trillion dollars in global commerce, and employs more than 60 million people globally. In total, the aviation industry supports almost 4% of global GDP.

Setting aside, for now, the disruptive 2020 crisis, and from which the industry will recover over time - even if not as quickly as some aviation commentators predict - the sheer weight of numbers associated with that success had become a problem of a different kind, one which was sapping the industry from within.

While the COVID crisis remains front-of-mind and the vast numbers associated with it, and its medium-term effects are challenging to comprehend, it is hard to take a perspective that, like most of the disasters that preceded it, it is not of the industry's making.

Aviation 3.0 - What we can do about it.

The issues the industry is collectively facing are - or were before the virus - quite broad. Lumping them into the simple figure expressed like it is above doesn't tell the full story, and neither is the figure shown above reflective of the real costs with which the industry must deal. What does 'system inefficiencies' mean? These are the estimated costs of the delays within the aviation system. Still, the number by itself doesn't fully reflect other issues like the environmental debate that has been brought into sharp focus since the virus shut down the industry in the first quarter of 2020.

The Environment

In 2017, the aviation sector consumed 341 billion litres of jet fuel, costing 149 billion dollars. That fuel generated 859 million tonnes of CO2, then about 2% of total global emissions and, notably, only 12% of all transport emissions. While we sometimes allow the debate to overlook how industry innovation improved the emissions efficiency of its aircraft by 70% since the 1960s, growth trends have projected emission contributions to grow significantly with the industry’s share amplified by the changing shape of the pie as other industries abate emissions more quickly—and it must be said, more easily. The industry continues to struggle with its environmental custodianship even with the enviable record it has established.

Even as COVD-19 has, for the time being, broken all the benchmarks and caused the industry to over-achieve on its environmental targets overnight, there are things that we can do now to be ready to make significant inroads with our environmental responsibilities as the industry emerges from the virus.

Scarcity

A term like 'system inefficiencies' doesn't begin to reflect projections about capacity constraint, which reached a tipping point in some parts of the globe in 2017. On July 22, Heathrow reported the busiest day in its history for London ATC, with the 8,800 planned flights that day exceeding the capacity of available airspace and other system infrastructure. The announcement contained some ominous forecasting noting that by 2030, scarcity will force the cancellation of that many flights every month. But July 2017 wasn't a one-off record-setting day.

Two hundred and twenty-five thousand flights took to the air on Wednesday, 24 July 2019, and while Flight Radar 24 data only dates back to 2006, this number sets the record since then. Again, NATS, the UK's ANSP, said it expected the summer of 2019 to be the busiest on record for air traffic in Europe. July 5 surpassed the 2017 total with a new high for flight numbers on a single day when NATS handled 8,863 flights in 24 hours. But instead of being lauded with accolades, most of the commentary was negatively focussed on the environmental impact, demonstrating just how intertwined the industry is. It doesn't end there. Knowing the magnitude of potential system delays doesn't tell the entire story.

Waste

According to figures from GE, we throw away 67 million meals annually because of delays and cancellations. Considering the upstream and downstream effect of that waste, the money sent down the drain in terms of the direct per-meal cost to the airline doesn't count the real catering 'system' costs to the environment. What else do we waste as a consequence of our success?

A holistic solution exists.

While it simplifies things to view these issues, and others like them as uniquely different, and therefore, requiring separate programs to address them, these issues are fundamentally related to the same thing - the unbound success of the industry. So, while separating them might be convenient for the committees, and may help the understanding each issue and perhaps provide the impetus for efficiency programs driving more efficient catering load scales, it doesn't fix the problem.

The industry continues to address its problems generally via a single-issue, at times, myopic committee system organised to solve issues like the environment, congestion, scarcity, air traffic control as separate matters. Soon we'll need to address other problems looming like UAVs, sovereign identity management including, as a result of COVID-19, new health, border management and security systems, touchless airport processes and a host of other utopian possibilities. However, the long history of rigid functional structure within the aviation industry, and as ostensibly reflected in the industry's rule-making and representative bodies, makes it difficult to reset industry worldviews and admit the interwoven nature of many of the issues facing it today.

Trajectory Based Operations

Trajectory Based Operations (TBO) is not a cure-all for what ails the industry. At its core is the strategic and holistic management - as opposed to control - of air traffic around the globe. But it's what is under the hood that provides potential pathways to radically improve the issues highlighted above, as well as quite a few others.

TBO is not a new concept, and the industry has been evolving - albeit (too?) slowly - toward a global environment that is conducive to realising the broad and deep operational and financial efficiencies that it heralds. But the aviation industry moves slowly. So slowly, that for all the benefits TBO will provide, some of which we'll discuss below was quietly pushed out from 2028 to 2032 before we'd even heard of COVID-19. Not because the concept is flawed, not because the technology wasn't ready, but because airlines don't view it as the crucial imperative to their survival that it is. Is it because they don't 'get it', or is it something else more fundamental about how airlines understand what strategy is? One has to wonder why airlines have overlooked it when the direct and, the just as critical, indirect benefits surface.

• Primarily about reducing delays and cancellations, the TBO concept is designed to address the congestion-related issues that contribute to the "system inefficiencies" sapping $60 billion at last count from the annual finances of the industry. No one suggests that TBO will eliminate delays and cancellations, but the targeted, whole-of-industry nature of the concept will have a profoundly positive effect on the capacity constraints the industry was experiencing before the virus and is the only tool in the shed that has a hope of facilitating the volumes of people and aircraft expected by the industry as the decade progresses. Even, dare we imply, after the industry setback of 2020.

• The building blocks of TBO like SWIM, PBN, PBP and FF-ICE provide immediate and ongoing benefits. System-Wide Information Management (SWIM), with its attendant information interchange standards, is ready-made to provide seamless data exchange and integration across the industry, yet uptake is poor. The capability of SWIM is somewhat prophetic in the current crisis where the industry is looking for ways to share a more significant amount of data as a consequence of the new information that will be required by airlines, airports, border control and almost the entire journey ecosystem. SWIM also provides the ability to share critical operational data, such as meteorology, aircraft performance and trajectory - or flight planning data - all cascading to more efficient operational outcomes for the industry.
  
  Performace-Based Navigation and Performace-Based Planning have already delivered capacity and other benefits to the industry, although the global implementation is running behind schedule. FF-ICE is not a new concept either and is already being used to prove the TBO concept and generate some efficiencies between the ANSPs availing themselves of its benefits. But it is surprisingly unknown. A pop quiz at a recent airline conference yielded only one person in a room of 350 airline ops executives who'd heard of it. The detail is crucial here. The 'C' in 'ICE' stands for 'collaborative', a critical feature in the SWIM/TBO concept and interestingly a term in extensive use in the context of the industry's emergence from its COVID-19 stasis. The new world order will turn on a Star Trek-inspired "needs of the many outweighing the needs of the few, or the one" nuance where we'll be collaborating as well as competing with each other into the future.

• A reduced environmental footprint for the industry is not so much a design element of TBO, but a consequence. The TBO concept considers the calculation of 4D trajectories that account for several inputs, the most obvious being traffic. However, other constraints can be added, like airspace closures for military or other reasons. On the back of the developing digital meteorology models, aspects of the trajectory calculation can also include avoidance of convective weather, turbulence, and airspace conducive to the formation of 'contrails.' Why's it important? A 2011  study found that contrail-generated cloud "contributes more to atmospheric warming than all the carbon dioxide (CO2) produced by planes since the dawn of aviation!" And it's being taken very seriously. At Heathrow Airport's "Big Green Day" in June 2010, the UK Met Office unveiled its plans to limit contrail triggered Ci cloud formation by closing airspace above 25,000 feet in areas forecast to be supersaturated. It's not hard to see the positives, but the negatives of such proposals are also troubling, and as usual, implementation will be crucial. TBO puts its stamp on the environment from day one by proposing the most efficient route accounting for all these and potentially more inputs. Like Holding.
  
  How often have the pilots reading this scratched across the sky trying to eke out a few kilos here and there, or maybe a couple of hundred on a long-haul mission, only to reach the destination and be stacked for long enough to blow all the hard work you do in a year out the tailpipe in one morning's work? TBO proposes the most optimal routes accounting many inputs and using the latest data on behalf of the many - not the few, or the one... By implication, any other route is sub-optimal, requiring speed, altitude changes, or more track miles away from the best solution that works for everybody. Because it considers schedule and traffic levels actively and holistically the TBO solution will also reduce holding. Depending on your operation, holding will consume more fuel in a week than all your fuel efficiency programs yield in a year. For some, depending on the aircraft and network, it'll be a day.

While the industry waits for electric (or hydrogen) propulsion for shorter flights, or significant improvement in engine and biofuel technology, TBO will put its stamp on the environmental debate almost immediately.

• Waste will be reduced commensurate with the greater schedule reliability TBO will deliver. The reduction in holding and the need to stay focussed on the schedule will drive a significant reduction in cancellations and delays. Of course, aircraft will 'go technical' and no one is proposing that it will be eliminated, but like the environment and operational efficiencies it provides, TBO will stamp its effect on this too. And remember, think about the real cost of this waste. It's not just what you see on the plate.

• TBO is an an-to-end solution delivering 4D, gate-to-gate trajectory optimisation. TBO refocusses air traffic control toward an air traffic management function - a strategic versus tactical and shared approach to keeping the industry moving. Today, the concept is evolving into a flexible, configurable 'whole-of-industry' concept that will benefit the many... Trajectory Based Operations is not the same as profile optimisation.
  
  Usually implemented as an EFB-centric application, profile optimisation operates by proposing new, supposedly optimal, altitude and Cost Index (speed) profiles as a flight proceeds from its initial cruise altitude. To work effectively, ATC must be able to facilitate the unfolding clearances necessary to give effect to the proposed schedule from the EFB. A cursory glance at the implementation and operating aspects demonstrate that profile optimisation and TBO are a long way apart. While the merits of saving fuel are inarguable, implementation, with execution is the elephant in the room, and at the top of the list is the need for ATC to be tactically involved with a focus on the equipped aircraft at the expense of others who remain on their planned and cleared profile. Profile Optimisation looks after the needs of the few and is certainly not a holistic, whole-of-industry solution.

In Summary

The commercial aviation industry has thrived since 1914, despite the setbacks. It is multifaceted, demonstrated by its ability to engage with every aspect of global trade, travel, and tourism. Its remarkable record with technology has driven the development of aircraft and the systems necessary to keep 4 billion people a year moving around the globe and continuing to ensure the financial viability of airlines with capabilities like yield management systems, demand-based and customer-based fares, and intelligent network scheduling systems finding optimal timetables. Technology has also reduced its early environmental footprint by 70%, although it has got further to go to keep up with community expectations - as well as perhaps trumpeting its credentials. The industry is not sitting idly by with its environmental responsibilities. Operationally, it has become and remains the safest way to travel. Its success is boosted because while once it was the purview of the rich, it is now a commodity almost everyone can afford.

Despite all the successes, the industry has its issues, too. Its size had, before COVID-19, grown to the point that there were times there wasn't enough air in the air to put all the aircraft that demanded it. Neither is on the ground in some parts of the world. Scarcity was a word that was entering the lexicon of aviation driven by rampant competition and demand because of its affordability, benefiting everybody - except sometimes, the airlines and the industry's associated businesses that are left to shave the already razor-thin margins, a hallmark of the industry, by $60b a year. Margins so thin, that any bump in the road is destabilising to the core. The GFC, 2001, and SARS all tested us, but the industry always overcame and regained its impressive growth trajectory. COVID-19 will be no different in time.

The sombre news that attaches to this crisis differs from the others that preceded it. The depth of the crash in demand and supply forced on the industry by global border closures and the shutdown of international, inter, and intrastate travel is unprecedented. While some pundits have been discussing optimistic emergence timeframes and recovery, some airlines have recognised the inevitability of a smaller industry on the other side, uttering 3-year-plus timeframes for the sector to regain its 2019 position. Many have already been taking action to reposition for a different world for a while. Yesterday, Qantas announced that a fifth of its workforce would not have jobs at the end of this, so dire is the nature of this crisis. Qantas is not alone. With few exceptions, Qantas among the fortunate, not many airlines went into this crisis with the ability to withstand what COVID-19 has wrought.

While all industry participants look to the industry's re-set, there are opportunities to build a more agile and resilient future for the industry and our customers and to achieve the ability to do so much more with less as the commercial aviation industry regains its footing and continues its own journey higher.

At Closed Loop, we believe the industry will grasp the lessons from this crisis and take the opportunity to reset the sector on a footing of agility and resilience. It'll take work, look different, and require acceptance that change will be inevitable. Ruthless evaluation of old thinking and old systems will make way for new methods and new technology enablers. This new direction will be a digital world where connectivity, data integration, collection and connection will be the new norm. It will enable new operating models to bridge the post-COVID world of distributed ledgers containing identity, health data, and journey details that can track every connection, relationship, and touchpoint. It will prepare the road for seamless implementation of TBO as the industry tempo picks up again.

TBO is almost a utopian vision for the industry, but a workable one even today. TBO and the new digital world in which it will operate will integrate the operation from upstream of customer arrival at the airport, through the airport and into the aeroplane, throughout the flight to the endpoint of the customer journey. The customer journey and the relationship with the customer will be the airline's focus, and old functional silos, the bastions of airline inefficiency, will erode and become integrated facilitators of that journey. Consequentially, environmental outcomes will improve, and waste reduction will occur due to the evaporation of the system inefficiencies and its $60b in today's figures price tag.

Do you sense the opportunity?

TBO is a well-developed and developing concept. New data standards already exist, so does SWIM. New digital technology enablers are working for some airlines now. What is needed are the processes and procedures that make them work and from which the value flows.

Closed Loop has frameworks to help airlines take advantage of the changing landscape in operating and operational nuance. Get in touch to arrange an obligation-free chat and set your strategy on a course to agility, resilience and the future.

For those who want to participate in reshaping the future and changing the self-reflective worldview of the industry into a utopian vision of what could be, like the potential described in this blog, Closed Loop has created the_Loop for airline, airport and industry visionaries to share ideas, ideals, and collaborate to change the world. Take a look at the introductory page and let us know if you want to become an agent for change by signing up.