The environment is a core issue for the aviation industry to manage and to ensure investors remain attracted to our industry to deliver sustainable growth. This roundtable session drew on the experience of key industry stakeholders to share current and future plans to address this challenge.
Representatives from aircraft and engine manufacturers, airlines, leasing companies and those involved in regulatory aspects defined the scope of the challenge by sharing insight on the regulatory framework, economic implications, development plans and management strategies.
The combination of inputs and opinions from both the table hosts and delegates made for what we feel was an insightful and interesting event. IBA’s CEO, Phil Seymour, has summarised the key takeaway themes:
A copy of the slides used, can be downloaded here.
• The consensus is that no one body is taking responsibility, each sector in aviation has its own take on the way forward. However, that said, ICAO/IATA is probably the most aligned from the airline/regulatory perspective (re CORSIA) and the Aviation Working Group is keen to develop its strategy and they tend to represent the OEMs and Leasing/Finance sectors.
• This position can lead to competition between airlines and airports to gain advantage over each other which some believe doesn’t help the industry as a whole.
• Green financing is in its infancy and will require more organisation and transparency from the participating banks, lessors and airlines for it to properly appeal to investors concerned about broader ESG issues.
• OEMs are faced with significant issues to address the sheer physics of flying aircraft thousands of miles. This is not like the automotive industry where the weight of electric batteries can achieve a reasonable range. Other fuels, such as hydrogen are several years (decades) away from being feasible on the scale required.
• Whilst improvements are being made in terms of fuel burn efficiency per passenger seat mile, this is not adequate to contain or reduce overall emissions given the general direction of growth of air traffic. Sustainable fuels and improvement in ATC procedures are the more likely reachable short term goals.
• With no immediate short term solution from OEMs, could all of the above lead to a view that we have to replace old aircraft with new? With the manufacturing carbon footprint – the current assembly/supply chain is built on global suppliers feeding into centralised assembly lines and that is unlikely to change, so switching to new (current) technology is not the silver bullet.
We are just at the start of this journey and the environment will feature in almost all aviation growth discussions for years, if not decades to come.
If you have further questions please contact: Marketing@iba.aero