Miss the 2018 CAPA Perth Aviation & Corporate Travel Summit? Check out some thoughts from our key speakers

6 July, 2018

The Blue Swan Daily was live at the 2018 CAPA Perth Aviation and Corporate Travel Summit this week. Catch up on some of the interesting thoughts from our key speakers:

CAPA - Centre for Aviation executive chairman Peter Harbison:

  • The Australian domestic market is seeing a "stabilisation" phase in relation to the competition between Qantas and Virgin. This is leading to an increase in pricing in the lowest fares brackets. Interestingly, in markets where Tigerair operates this tends to be less accentuated.
  • There is a clear increase in the average ticket price in the Perth market. He stated this is caused by the stabilisation in the competition between Qantas and Virgin Australia.
  • The aviation industry is sensitive to external factors. Mr Harbison highlighted the impacts caused by the Qatar blockade and sanctions to Iran, adding each scenario "hasn't done any good at all".
  • It is important the US government has not stepped in the aviation industry. He stated the US administration "has been light handed" with intervening in the industry.
  • On the trend of increasing fuel prices, stating that fuel hedging is not really a long term solution to anything. He added: "It's just buffering".
  • The traditional distribution industry for airlines is "ripe to being disrupted". The framework around GDS limits carriers' capacity to deliver more personalised products to clients, Mr Harbison noted. In this perspective, NDC "creates some richness" allowing carriers to tailor a service oriented to the individual and effectively supporting an expansion of ancillary revenue.

Perth Airport CEO Kevin Brown during his keynote discussion and as part of the executive panel on stimulating Perth's tourism:

  • On Qantas' recent launch of nonstop Perth-London service, stating: "Qantas is happy". He added that "it was clear" that within a year of the launch to London, Qantas would be looking at launching other destinations in Europe, namely Paris and Frankfurt.
  • Western Australia (WA) is seeing a resurgence in its economy. He stated that job offers in WA has increased beyond the national average rate, and the tourism business is working on offering "high quality accommodation" and "world class attractions" such as the new Perth Stadium to support the growth.
  • The airport is working on developing a new parallel runway and 24/7 operations. Out of travellers arriving in Perth, 93% arrive via air. Mr Brown mentioned a "build it and they'll come" approach to developing the airport but stated currently the process has been "build it just before they come". He defended the construction of the new runway to address a pickup in passenger numbers, highlighting that international passengers will continue to grow, estimating a 50% increase in that market in Western Australia in the next decade, an extra two million travellers p/a. He stated the airport's approach now is to "plan and advance to stay ahead of the curve".
  • Asia represents a "Potential market of over four billion people at our doorsteps". He stated Perth-India and Perth-China traffic reached 140,000 and 180,000 passengers p/a, respectively. Mr Brown added: "Most importantly, we've seen" growth in these markets.
  • Aviation connectivity plays a major role for Western Australia's industry, as it "connects our fresh food exports and attracts more international students to Perth". He added that India makes up the highest proportion of the international student population, and along with students, VFR traffic is stimulated.
  • The airport already invested AUD4 million (USD2.9 million) in master plan improvements. He added the second runway project is needed to "stay ahead of the curve" in relation to demand, commenting that it's "something talked about since 1970's", and will offer flexibility and capacity. He argued that model projections show a new runway is needed when movements reach 145,000 movements p/a. According to CAPA's profile on Perth Airport, the airport handled nearly 130,000 operations in 2017.

Tourism WA was well represented at the event with both Tourism WA executive director - strategy, brand and marketing services Louise Scott and Tourism WA director aviation development and policy Claire Werkmeister speaking.

Tourism WA executive director - strategy, brand and marketing services Louise Scott:

  • Tourism WA is working closely with Study Perth to attract more international students to WA. She stated: "If we don't have a large international student population, we also don't have their visiting family and friends".
  • Malaysia "has a high level of interest in Western markets". She added that Western Australia has the pre requisites to tap into that market, namely being a "friendly for Muslims" destination, catering for their needs with restaurants and other activities. She stated: "We try to push them out north and south of Perth to experience other destinations in WA".
  • The marketing approach to the Chinese market includes translation of films into Chinese as well developing films specially for the mainland China market. Other campaigns include buying marketing space in buses in Hong Kong, which led to an increase in bookings from the market.
  • Western Australia (WA) has "a wealth of experiences" to be offered to travellers, however there is a key barrier of time and cost for east-west travels. She stated Tourism WA is working to "hit the market with a strong message" that WA is worth it.
  • Tourism WA is working closely with Study Perth to attract more international students to WA. She stated: "If we don't have a large international student population, we also don't have their visiting family and friends".

Tourism WA director aviation development and policy Claire Werkmeister:

  • There is "no silver bullet" for Western Australia (WA) when it comes to the development of regional aviation, as every region has its own challenges and peculiarities. She added that Tourism WA is working on different activities to make regional aviation work, but "to be honest, sometimes they don't work", but it assists with using the seasonality of routes. One of Tourism WA's goals is to develop affordable regional routes to assist with residents' travels.
  • Western Australia has "so much to sell and it is quite different from the east". She highlighted that the state is closer to some Asian markets than the east coast of Australia, with same time zone as these markets. One of the important features of the state, according to Ms Werkmeister, is that "we have space, we're not too busy… It's busier and busier in the east".
  • Tourism WA's work approach is to understand the markets in order to establish partnerships to look at secondary markets, not only direct markets. These partnerships make sure Tourism WA is in the loop to "know what airlines are doing" to help with developing air connectivity.
  • The China and Japan markets are key for Western Australia. She stated Tourism Australia is working on means to "open up the gates to China" and increase frequencies to daily. Regarding Japan, Tourism WA is working on establishing direct Perth-Tokyo connectivity.
  • The freight market is very important for Western Australia and the state has room for expansion in the sector.

To join us at future events in 2018. Register here.