IATA Annual Review 2012

In the face of such strong headwinds,
keeping revenues ahead
of costs is a major challenge.
We still expect airlines to make
a collective profit in 2012. But
it will be razor thin. Conserving
cash, carefully matching capacity
with demand, and managing
costs will remain the focus for
most airline managements.
Behind the scenes, IATA has
redoubled its efforts to manage
the industry’s settlement
processes reliably. Fully $367
billion passed through IATA’s
financial systems in 2011. The
Billing and Settlement Plan—
the largest among IATA’s financial
services—settled nearly
$250 billion in volumes with
99.971% accuracy. We are
determined to do even better.
IATA is strengthening its settlement
systems. By migrating
functions to regional hubs, we
will operate to a single global
standard on fully integrated IT
systems. The migration will take
place progressively until mid-
2014. In a separate program,
we are taking paper out of the
processes for the $49.5 billion
IATA Clearing House.
Along with ensuring reliable
financial services, IATA is
working with its members on
aviation’s most fundamental
challenges—safety, security,
and sustainability.
The Director General’s message
2011 was the safest year for
civil aviation. There was one
hull loss for every 2.7 million
flights with Western-built jets—
a 61% improvement on the
performance a decade ago. The
IATA Operational Safety Audit
(IOSA) is making a difference.
Airlines on the IOSA registry—some
375—outperformed
the accident rate for non-IOSA
operators by 52%.
Together with the International
Civil Aviation Organization
(ICAO), the US Department
of Transportation, and the
European Union, we continue
to build the Global Safety
Information Exchange. This
collection and sharing of data
will enable analysis for targeted
programs to make our safe
industry even safer.
Security processes must evolve
to be risk-based and data
driven. Our flagship security
programs—Checkpoint of the
Future and Secure Freight—are
built around these principles.
Support from governments is
growing as they recognize the
value of these initiatives.
Aviation remains united in its
global approach to managing
its carbon emissions. Airlines,
airports, air navigation service
7
providers, and manufacturers
reiterated their commitment to
improve fuel efficiency 1.5%
annually to 2020, to achieve
carbon-neutral growth from
2020, and to cut net emissions
in half by 2050 compared with
2005 levels.
Governments are important
partners in meeting these
targets. They must implement
policy measures that de-risk
investment in sustainable biofuels,
unlocking their potential to
reduce aviation’s carbon footprint
up to 80%. And they must
agree on a global approach to
positive economic measures
through ICAO. Progress is
being held back by the global
backlash against the extra-territorial
inclusion of aviation in the
EU Emissions Trading Scheme
(ETS). ICAO offers a process
to reach the global consensus
that all parties—including
Europe—desire.
The ETS impasse highlights
the urgent need to reaffirm our
agenda with governments on
jobs and growth. Many governments
sacrifice the benefits of
aviation-enabled connectivity
for the shortsighted budget and
political gains of high taxes,
misguided regulations, and
growth restrictions.
Job creation is a priority of all
governments. Aviation can help.
Already our industry supports
the livelihoods of 56.6 million
people and $2.2 trillion in
economic activity. And governments
must understand that
with an enabling policy environment
we could do much more.
When aviation gets stronger, so
does the economy.
I am passionate about aviation.
As the Director General and
CEO of IATA I have proudly
sung aviation’s praises and
advocated policies and partnerships
that support its success.
I thank the IATA Board of
Governors and our members
and partners for their great
support in helping IATA help the
industry.
Aviation is indeed fragile. But
by working together, I am confident
that we can strengthen the
foundations of our safe, secure,
and sustainable industry.
Tony Tyler
Director General & CEO