For decades, airplanes powered by oil have transported huge numbers of passengers from one place to another, particularly in the developed world. The industry has faced its fair share of challenges over those years—deregulation; bigger, then smaller planes; computer-armed customers shopping for the cheapest tickets; carrier consolidation—but the broader picture has always been the same: big bird, big crowd, Big Oil.
Not for much longer.
Every aspect of the passenger airline business is changing, in ways large and small. Together those changes will amount to a mega-disruption, upsetting almost every part of this model. Expect changes in what time planes take off and land, how they’re guided through the sky, and who’s in the cockpit. Back in the cabin, the demographics of passengers—and their demands—are also changing. Then there’s the aircraft itself: its size, its fuel, and even its destination.
In short, one of the world’s most global industries finds itself at the mercy of global economic, demographic, and technological trends. And that may mean turning aviation’s now very familiar business model on its head. Disruption seems inevitable. It’s less clear whether it will be controlled by savvier old hands, such as Airbus and Boeing in the case of plane manufacturing, or upstarts such as the Chinese challenger, Comac. Huge airlines such as American Airlines may find themselves looking to their fast-growing Asian counterparts, such as Vietjet or Sriwijaya Air, for inspiration. At the heart of it all is one critical question: how can an industry often said to be approaching capacity find a way to achieve sustainable growth?
For those heavily invested in the sector, there is reason to be optimistic. Historically, the airline industry has shown itself to be good at solving problems, working with plane manufacturers, governments, and regulators to get people into the sky (often at a profit), even amid dramatic shifts in scale. In the space of less than a century, we have gone from having a few hundred people flying each year to a few billion. Many of the obstacles it faces today present tremendous opportunities for growth, even though in the short-term they require big investments of capital. (Maybe it’s a good thing that this disruption comes while carriers and manufacturers are mostly in the black.)
PRINT THAT
The technology is changing
If Boeing is to be believed, more than 41,000 new aircraft must be produced in the next two decades. Airbus is only slightly more conservative: 36,600 passenger planes and another 830 cargo aircraft. Either way, the gist is the same: We need a lot more planes, and fast.
The way the two giants (they account for more than 90% of the world’s plane orders), make planes means they are not currently prepared to meet that growth. Airbus’ twin-engined A350 takes around a month to put together. Boeing’s processes are seemingly more streamlined—the company boasts a nine-day turnaround for the 737. Together, the two make about 1,600 jets a year. If their predictions are correct, and production rates stay the same, they’ll be about 20% off target.
Fortunately, technological advances will help bridge the gap. “Digitalization,” 3D printing, and modular design, in which prebuilt components can be loaded onto the plane, are among the most significant.
Digitalization has the power to revolutionize how planes are put together, how they’re maintained, and where they fly. Already, hundreds of sensors across the body of planes such as Airbus’ A350 produce huge amounts of data, allowing engineers to keep tabs on everything from how much strain the plane is under to which components are in need of repair or maintenance. The long game is a digital twin of the plane, where manufacturers will know in real time exactly what’s happening in the engine or in any of its components. These sensors will also soon play a hand in making micro-adjustments to flight routes, using the many terabytes of real-time data at their disposal to avoid turbulent spots and capitalize on changes in tailwinds or headwinds to maximize fuel efficiency.
For passengers, digitalization should make for a more comfortable and pleasant flight. In the cabin, an abundance of data should make it easier for airlines to forecast how many meals they’ll need, reduce wastage, or direct late-arriving passengers to an available overhead bin. The same sensors that warn of wear to aircraft parts can also be put to work telling crew that the lavatories are in need of a freshen-up.
For the airlines, it means they’ll be able to cut down on labor costs by automating many tedious manual procedures. More efficient flight routes should allow them to spend less on jet fuel, while proactive maintenance may extend the life of their fleets, and help scale back on the costly exercise of replacing old planes with new ones.
Over the past five years, Airbus has made significant investments in 3D printing, allowing the manufacturer to conjure up plane parts as it needs them. The technology should eventually eliminate the need to source parts for older crafts from suppliers, speeding up the supply chain. It may also allow manufacturers to print parts close to where the plane is located, rather than at the original plant where it was built.
At present, the technology is still expensive and rather slow, especially when it comes to older parts. If they were not originally 3D printed, Airbus head of technology Cyrille Schwob told an audience at the Aerospace & MRO Summit Bangkok in May, “the part needs to be re-designed with a new material or a new process being carried out by another supplier that needs to be re-qualified.” The surface of the parts must be finished separately, adding an additional layer of complexity to manufacturing.
The biggest difference of all will come in what the plane is actually made of. Manufacturers are moving away from metal-alloy planes and toward strong, light, composite materials. In layman’s terms, these are hybrid substances produced by layering sheets of carbon fiber-reinforced plastic material one over another. Produced using huge robot looms, the material is more expensive than metal-alloy, but promises savings by requiring much less maintenance. (It doesn’t corrode or rust, for instance.)
While these innovations might change how planes are produced or maintained, others seek to disrupt the aircrafts themselves. More than 15 years after the British-French turbo-jet powered Concorde’s final commercial flight, US firms such as Aerion, Boom and Spike Aerospace want to put supersonic transport back in the air, to get passengers from London to New York in just over three hours versus the six or seven it takes now. (Boeing, not to be outdone, released concept images last year for a hypersonic plane to be released in 20 to 30 years.)
Colorado-based Boom has already raised more than $140 million, including $10 million from Japan Airlines, and is in the process of developing its 55-seater Overture plane, which it promises will be 30% more efficient than its late lamented predecessor. Despite the company’s name, it says its own sonic boom will be 30 times quieter than Concorde’s. Spike, based on the other side of the country in Boston, and Aerion, located in Reno, Nevada are thinking smaller still, with prospective models seating around a dozen people. Aerion, which signed a development deal with Boeing in February, is especially optimistic: it has scheduled a 2023 flight date for its AS2.
Given the long timeline to meet regulatory requirements, the prospect of nipping over to Rio for carnival weekend is a way off yet. And even then, Spike and Aerion’s proposed small cabin sizes mean they will likely be far beyond most people’s means. (Concerns about sound and carbon pollution may also limit their success.) But some carriers are ready to take the leap. Boom has already reported $6 billion in pre-orders from airlines such as Japan Airlines, which has the option to purchase up to 20 Overture jets.
And then there are flying cars. A fleet of companies are competing to get unmanned, two-seater crafts into the sky. Many are intended to be used like air taxis, to ferry wealthy passengers between islands, from central cities out to major airports, or simply to circumvent ground traffic. The Chinese drone manufacturer EHang has been conducting test flights for months, and received domestic government safety certification in August for its point-to-point autonomous flying vehicles.
In Germany, meanwhile, startups such as Volocopter and Lilium are also already off the ground. Volocopter’s two-seater craft has the body of a sawn-off dragonfly, beneath a lattice-like web of propellers. Lilium is more ambitious in both the scale of the craft, which seats five, and a slated potential distance of 300 kilometers (186 miles).
While it emulates helicopters, this point-to-point transport seeks to open up a whole new slice of the aviation market. The distances are, on the whole, too short to make much of a difference to airlines’ traditional routes. Instead, these flying shuttles hope to appeal to people without the time or inclination to put up with slow ground transportation, in much the same way that ride-hailing apps offer respite from public transport. (Uber Copter, which offers $200 eight-minute helicopter flights from Lower Manhattan to New York’s JFK airport, uses pre-existing technology to do something similar.)
But the greatest hurdle for flying cars isn’t the technology, which improves at a bounding pace. Regulatory changes from the FAA and other global bodies are slow and hard to come by—especially in the light of the 737 Max disaster, which may encourage yet more scrutiny. Glint-eyed engineers may also find their ambitions thwarted by local governments unwilling to welcome yet more traffic to already-crowded skies.
ON THE MOVE
A power shift from West to East
Newly industrialized countries such as India and China have enriched a billion people, making them members of a global middle class—and, as a result, prospective fliers. (They’re one reason we need all those new planes.)
This new middle class is on the move, indulging in the overseas vacations that were once the purview of Westerners and the elite. Last year, according to World Tourism Organization data, international tourist arrivals worldwide hit 1.4 billion, two years ahead of forecasts. Cheaper travel, facilitated by lower fuel prices and fewer ticket taxes and airport charges, is also part of the reason why we’re seeing this growth. At the same time, governments around the world are leaning into the potential of travel and tourism to boost their economies, often with the support of development organizations such as the World Bank, further fueling growth.
In 1993, 73% of all air traffic took place in Europe and North America. Twenty-five years on, the picture is very different: Ten of the world’s 20 busiest airports by passenger volume are located in emerging Asian economies, according to 2018 data. Many of the leading global hubs from the turn of the new millennium may be less strategic than they once appeared.
For aviation, such massive expansion is a double-edged sword. On the one hand, more passengers means more profit (possibly). Aviation infrastructure has already begun to adjust to make room for this tidal wave of future passengers: by 2025, China will have invested more than $150 billion building airports, runways and other infrastructure. Meanwhile, London’s Heathrow has fallen from the biggest global airport to seventh place, as airports in cities such as Bangalore, Hyderabad, and Jinan are seeing growth of more than 15 million passengers a year. Airlines may also be forced to rethink their relationships and strategic partnerships, especially given the many restrictions on which carrier has the right to fly where.
For an airline with the right approach, there’s plenty of money to be made. The challenge, however, is working out what that “right approach” might be, and approaching it with enough flexibility. A win-win solution for the sector is possible, writes Pierre Coutu in the industry handbook Global Megatrends and Aviation, through “collaboration among emerging and advanced economies,” where airlines seek to cooperate rather than compete. On an operations basis, welcoming more passengers from more places may mean making conscious moves to accommodate cultural differences—and investing in staff members with a global outlook, including speaking more languages.
From an environmental perspective, there are other challenges: rapid growth will make it harder for airlines and aviation companies to meet even self-imposed carbon-related goals, let alone those imposed by the UN’s looming Corsia regulation (more on that below). In 2012, US airline Delta opted to place a permanent cap on its future emissions: in the seven years since, the airline says it has purchased over 12 million carbon offsets, at roughly $15 an offset, to account for its growth. Replacing older planes with more fuel-efficient models has also helped to accomplish this goal. But the more passenger numbers grow, the harder it becomes to minimize impact.
The center of gravity is shifting east in the rarified plane manufacturing business, too. Though Airbus and Boeing continue to sit pretty in the top seats, China is aggressively investing in its aerospace industry with the goal of challenging the duopoly and becoming a significant global player as soon as 2025. (It has specifically stated it wants to supply 10% of commercial aircraft domestically and 25% of jetliners worldwide by this date.)
In 2016, the Chinese government spent $14.4 billion establishing the Aero Engine Corporation of China (AECC), followed by a 2018 push to raise $16 billion from private investors for drone and maintenance projects. Though progress does not appear to be happening as quickly as Beijing might like, if the success of its homegrown electric cars and autonomous vehicles are anything to go by, the country may soon prove as disruptive in the air as it is on the roads.
JET SET
Boomers are retiring—and they want to see the world
Born between 1946 and 1964, baby boomers are the original commercial flyers. They are the beneficiaries, if not the architects, of virtually every trapping of the jet and post-jet age—bicoastal business trips, premium economy, duty-free shopping. In almost half a century of regular flight, they have seen extraordinary innovation on almost every front. But now that they’re retiring, not all welcome changes to a now very familiar process, even changes as minor as electronic boarding passes.
For a significant number of these recent or imminent retirees, travel comes high on their bucket list. According to figures from AARP (formerly the American Association of Retired Persons), most American boomers have eight different destinations on their list, of which half are international. Then there are wealthy retirees who have grown accustomed to shuttling between two homes: Already, flights between the UK and Portugal’s Algarve are popular with older travelers, while their US counterparts move between Florida and New York.
Aging populations are a worldwide phenomenon (see the US, Japan, Italy, Sweden, China). By 2050, more than 30% of the global population will be over 65, with around one in 16 of that group aged over 80, and elderly people will make up a significant part of the traveling public.
For airlines and airports, changes are already underway to cater to older passengers’ specific needs. Ordinary stresses of lost baggage or making it to the gate on time are much more challenging for a traveler who cannot walk long distances, or whose sight or hearing is impaired. That’s without factoring in, as one Federal Aviation Administration publication notes, “the psychological challenges of anxiety of running late for a flight [with] a limited ability to adapt to change.”
Airlines are beginning to place greater emphasis on things like improving accessibility. Every few months, representatives from each airline come together to discuss their plans. “I’ve been in the airline industry for a long time, and everything’s always covered by antitrust” legislation, says American Airlines’ Gina Emrich, who runs the company’s accessibility initiatives. “That’s not true in this space. We work together to try and improve the experience, because none of us think it’s a competitive issue.”
Those efforts include improving the narrow aisle chairs used to transport passengers who may not be able to walk on and off the plane, as well as to help them access the lavatory. More important, Emrich says, is making sure best practices for passengers with accessibility issues are consistently applied and made a focus. “The ugly truth is, while everyone knows it’s the right thing to do, you still can’t ignore that you have to build a business case to do it. We have to build the business case for why this is important and continue to build that momentum within our companies.”
In the long run, this is likely to include having more wheelchairs available, wider aisles, and better support from ground staff. It may also include visual paging for the hard-of-hearing and other services for those who have reduced sight or may be confused under stress. On board, there are other factors to consider: more wheelchairs means slower deplaning, for instance, while frail passengers may increase the need for on-board doctors or better medical training for stewards. Unfortunately, none of these things come cheap.
Changes are afoot at airports too. At Southwest Florida International Airport in Fort Myers, the terminal experience is set up to support older travelers, with electronic signage, airport shuttle buses to assist with luggage, and additional wheelchair storage space.
Modern Asian airports face some of the same issues, says Max Hirsh, author of Airport Urbanism: Infrastructure and Mobility in Asia. “A lot of airports in China are designed to impress, so they’re very awe-inspiring.” But a huge scale isn’t always very passenger-friendly, with very long walking distances between gates or throughout the terminal. Given China’s aging population, he says, “that’s going to present a lot of challenges not too far down the road.”
EMISSIONS BLUES
The precipice of an environmental crisis
We are sitting on a cooking planet, and planes are partly to blame.
Though it contributes only 2% to 3% of all carbon emissions, the aviation sector punches way above its weight for environmental damage, relative to its size. As the world grows keenly aware of the need to reduce humans’ carbon footprint, airlines are feeling the pressure from governments, customers, and investors to do their part.
A single hour of flight pumps about 200 lb (90 kg) of carbon dioxide into the atmosphere. You can add to that a shopping list of other nasties, including lead, other greenhouse gases, sooty black carbon, and other particulates. Because planes are so high up in the sky, their emissions may have a much greater effect than the same amounts put out at ground level. Planes’ nitrogen-based emissions, for instance, turn to ozone at these high levels, increasing the effects of global warming. Add to that the impact of contrails, which temporarily trap heat, and the damage wreaked on birds, and it’s not hard to see why environmentalists would rather take the train.
There has been some progress. Already, planes’ fuel-efficiency is vastly improved, virtually doubling between 1960 and 2008. Lighter body material helps, as do subtle route-changes that allow pilots to capitalize on weather conditions. Airlines have proactively swapped out older models for these newer crafts. But these changes are at the easy end of a continuum that stretches all the way to carbon neutrality. Current efforts are nowhere near enough: Aviation emissions have increased by more than a quarter since 2013 alone, while fuel efficiency is expected to increase by only 2% a year.
One of the most significant regulatory moves comes from the UN’s “Corsia” scheme. This carbon-offsetting system would cap emissions at 2020 levels, even as passenger numbers continue to rise. Airlines can purchase emission “offsets” to compensate for some of their own growth, or branch out into lower-emission (and higher-price) eligible fuels. A voluntary pilot phase of 78 countries, including Japan, the UK, and the US, will begin in 2021. By 2027, the scheme will become mandatory.
Offsets are relatively inexpensive, for now. But as the easier options are exhausted, achieving Corsia’s goals will require much greater effort. This may include heavy investment, significant technological leaps and bounds, and perhaps accepting a higher cost for flight.
The endgame, of course, is moving away from the vagaries of fossil fuels altogether. Possible solutions include electric crafts, synthetic or biofuels, or some other combination of the two. For now, all of these are very expensive options—but if there’s a way to do it, it may eventually prove to be good news for airlines’ bottom lines, as well as the planet, given that oil and jet fuel currently make up around 30% of total costs.
Expect challenges from the physical effects of climate change, too. Airport terminals located close to the coast, in places like Wellington, New Zealand, Hong Kong, or New York’s JFK airport, are at risk from rising sea levels literally swallowing up their runways. To counter this, Hong Kong is building an eight mile (18 km) sea wall around its third runway, while Singapore’s Changi airport took the dramatic step of raising its new passenger terminal 18 feet (5.5 meters) above sea level. The many airports which are not trying to mitigate rising seas risk extremely expensive infrastructure damage and potential knock-on effects on airlines’ networks.
Global warming and associated extreme weather events will make flying technically more difficult, too. As temperatures rise, air density falls, making it harder for planes to get enough lift to take off. One solution is more speed over a longer distance ahead of hitting the skies. For airports, this may mean extending runways. When the mercury really soars, some planes are grounded altogether. (Smaller, less expensive crafts have a lower maximum temperature at which they can legally take off.) Then there’s the risk to the infrastructure itself—planes literally cracking in the heat, or runways and taxiways buckling and warping.
Extreme heat waves, such as the 120’F (49’C) highs in Phoenix, Arizona, in the summer of 2017, are already becoming much more common. Over time, it’s likely that airlines operating in these warmer areas will have to be purposeful in buying lighter crafts that can handle these extremities of temperature. (An interim solution might involve cutting down on a plane’s weight by reducing the number of seats on board or making baggage still more expensive.) If they don’t, they risk costly no-fly days or weeks. Airlines may also push for the removal of night-time noise curfews, allowing them to take advantage of cooler evening temperatures.
But rising temperatures is just one card in a whole hand of extreme weather events. Storms and hurricanes bring with them the risks of airport flooding, flight delays, and cancellations. Changing atmospheric conditions can make it harder to fly planes, with stronger winds increasing turbulence to dangerous levels. The clear-air turbulence (CAT) produced by these conditions is very hard for pilots to detect ahead of time—when encountered, it is far more disruptive to passengers than usual bumps and shocks, potentially resulting in more in-flight injuries. Boeing is currently developing LIDAR laser technology to help pilots detect CAT a few miles away, giving them time to warn passengers to fasten their seatbelts and sit tight.
Who’s going to fly all these planes?
Airlines need pilots—and fast. In Asia and the Middle East, a travel boom has forced carriers across the Asia-Pacific region to work their pilots almost to exhaustion, cut the number of flight hours to speed up the qualifying process, or scrap certain routes altogether. The pressure to hire more pilots is intense. An internal Emirates memo released in January revealed that the Dubai-based airline hoped to capitalize on the failure of competitors such as Norwegian Air to “source and select good-quality pilots.” In 2017, it spent $270 million establishing a new training center for pilots. South Korea’s Jeju Air and Indonesia’s Lion Air have similar schemes.
The US, meanwhile, is struggling with high attrition, as the pilots hired during the 20th century hang up their flying goggles for good. In 1990, there were about 150,000 commercial pilots in the US, flying around 440 million passengers. Thirty years on, the number of passengers has almost doubled to roughly 850 million, while the number of pilots is down by about a third, at around 100,000. A fair number of pilots still flying were trained during the Vietnam war. As they approach their mandatory retirement age of 65, the US is staring down the barrel of an unprecedented pilot crisis. Without significant change to hiring and labor practices, it’s not clear who will step up to the plate.
The high cost of training is one part of the problem, explains former pilot Geoff Murray. In the US, wannabe pilots must graduate a four-year college degree program before starting their pilot training, at a cost of sometimes hundreds of thousands of dollars. It’s one significant reason why student pilot dropout rates are way above 50%.
“Interestingly, the pilot shortage has become so acute that a variety of airlines just within the past six or eight months have actually relaxed the requirement for a degree,” he says. Others are considering adopting the same model as Qatar Airways and other foreign competitors, where the airlines sponsor pilots out of high school and underwrite the cost of their training.
In the US, the FAA stipulates that aspiring pilots must fly for 1,500 hours before they are allowed to serve as copilots. Pilot training may give them as few as 300 hours, leaving students scrabbling to find another 1,200 hours. (A single hour of practice flight time costs upward of $100.) In the past, pilots trained by the US military could parlay their experience into a commercial job. But the army’s move toward using more drones and fewer manned planes plugs yet another pipeline.
Flying lacks the glamor of the Pan-Am age, says Murray, who heads Oliver Wyman’s global aerospace sector team, contributing to the huge difficulty in attracting people to the sector at all. “Such a large proportion of the population is traveling that it’s become commonplace.” And though pilots are only permitted to fly 80 hours a month, the profession has a reputation for long days and lonely nights away.
Through his work helping with recruitment, Murray has found a generational issue at play too. Many millennials are turned off by the prospect of doing broadly the same thing throughout their career. Instead, he says, they are actively looking to be engaged—to contribute to the company’s culture, understand its mission, and feel that they have a seat at the table. “They’re recognizing that there’s a pilot shortage, an acute, dramatic shortage all over the world, right now,” he says. “So they’re saying, ‘I’m interested in flying, but I’ve got all of these other objectives that I want to achieve in the course of my career.’”
Those wanting a hands-on experience may also be disappointed. Despite the length of training, a huge amount of current flying is now automated. Trainee pilots often spend far more time grappling with computer systems than practicing hands-on flying. A resulting lack of airmanship, former pilot William Langewiesche argues, may have played a role in 2019’s 737 Max crashes, with a generation of pilots unable to handle anything more challenging than mild turbulence. Pilots now rely on autopilot so often, JetBlue safety director Kevin Hiatt told the New York Times, that “they become a systems operator rather than a stick-and-rudder pilot.” With as little as three to five minutes of active flight time on some routes, this is no longer a career for thrill-seekers.
At the same time, a striking lack of gender diversity in the field—fewer than one in ten commercial pilots is female, for instance—may alienate candidates, shrinking the prospective pool even further. Efforts are underway to address some of these issues, from making sure pilots feel engaged and included within their airline to aggressively recruiting more female pilots. For potential aviatrixes, for instance, there’s plenty of scholarship money available, and the strong backing of flight operations leaders. “I think that’s going to lead to a dramatic evolution in the proportion of women who make their way into airline flight decks,” says Murray.
Embracing total automation and eliminating pilots altogether probably isn’t on the immediate horizon, though it may be the best long-term solution. The technology exists, but regulatory concerns around cybersecurity and safety are still too great. There’s significant customer resistance to reckon with, too—even the most secure flier may be uncomfortable 12,000 feet off the ground with a robot at the helm.
Outside of commercial aviation, however, pilotless planes are already part of the landscape. In a military context, that means drones: the US’ 47-foot Global Hawk surveillance craft or Israel’s Herons, which the company sells to India and Vietnam and leases to Germany. As The Economist notes, “pilotless aircraft can be sent on missions too dangerous for people, and possibly ones that piloted craft would be incapable of performing. This could change how future wars are fought.” Here, autonomous aircraft may actually be the safest solution, prompting a flurry of research and development from militaries around the world.
For now, the sector is grappling with a potential single-pilot model, down from as many as five crew members in the cockpit in the 1960s. Airbus and Boeing have already begun testing single-pilot cockpit simulators. In one NASA-style approach, an on-the-ground pilot might work with up to five in-air pilots simultaneously, intervening remotely if any plane was in trouble. But this is a long way off: so far, the FAA is unwilling to adjust their regulations until they’re convinced that autonomous planes are at least as safe as those operated by humans.
Still, if the safety, regulation, and public-facing issues can be addressed, airlines may be able to cut costs on the second-biggest outlay after fuel, trimming their labor budget by as much as $60 billion a year.
FAST FORWARD
Now what?
Demographic and economic trends are clear: growth is inevitable. But unless airlines and others in the sector approach it thoughtfully, and with an eye to sustainability, they’ll quickly find themselves hitting a brick wall of regulation, capacity, or some other unknown force.
The incremental changes the sector has embraced so far, such as more fuel-efficient planes, are likely to fall short of the huge shifts needed in the decades to come. Understanding which changes customers (and regulators) will embrace, what problems are the most pressing, and the best place to shell out cash is a still more challenging endeavor. Even the most profitable airlines struggle to think beyond two to five years into the future. Startups with big dreams, meanwhile, may find themselves stymied by a lack of funding, drop-offs in consumer interest, or the heavy hands and deep pockets of the giants they seek to disrupt.
“The forecast for aviation, fleet growth, and the MRO market is basically bullish,” writes Oliver Wyman VP Tom Cooper. But that doesn’t mean there aren’t risks. “Fast growth often leads to strained capacity and higher costs, as pent-up demand allows suppliers to raise rates and workers to seek higher wages.” Lopsided growth, where most new travelers are concentrated in the Asia-Pacific region, may result in a more equal share of global profits. In 2017, for instance, American and European airlines accounted for more than 70% of carrier profits. With seven of the world’s fastest-growing airlines in emerging markets, that could change.
For consumers, the cost of a ticket will be closely linked to the price of oil, as has long been the case. More global demand for jet fuel could drive it up. Airlines may have no choice but to raise prices, especially if they opt to push the price of meeting environmental regulations onto customers.
In discussions with governments and industry partners such as easyJet, Wright Electric CEO Jeff Engler told Quartz, he kept coming across the same phrase. “People do think this is the third, next generation of air travel,” he says. Propeller planes and jets can take us only so far. The future must be smart, environmentally friendly, and able to be scaled. At this early point, it’s not clear whether that new generation is 15 or 50 years away. Either way, he says, “when it’s at the beginning, it’s a lot of work. But people working together is probably the only way that it can happen.”