The independent thinking handler

posted on 20th August 2019
The independent thinking handler

Airline Assistance Switzerland only handles at Zurich Airport but is looking to expand and is taking an innovative approach to some challenges, writes Justin Burns

Zurich-based independent ground handler Airline Assistance Switzerland (AAS) has grown its airline clients this year and is now targeting new markets.

The handler provides services to 15 airlines at Switzerland’s busiest airport after securing a major contract with ever-expanding Lufthansa Group carrier Eurowings.

Speaking at IGHC in Madrid, Dieter Streuli, Chief Executive Officer, AAS, said the handler has seen significant growth this year.

“We have won major customers like Eurowings so we could position ourselves very well in the Zurich market,” he said. “We are well prepared for the summer.”

AAS in one of only three handlers at Zurich Airport, where it competes on the home turf of Swissport and with fellow heavyweight handler dnata.

“It is a hard position we have in Zurich with the main competitor Swissport on its home turf, but we are doing well,” Streuli said. “The PRM business in Zurich is a huge project for us and that is also doing well too.”

He said AAS has a market share of 10-11 per cent in Zurich but given the fact the Lufthansa Group has 70 per cent of the market, which is more, or less with Swissport, the applicable market share is about 30 per cent.

CAPACITY CRUNCH

Zurich Airport has seen steady growth, and in 2018 passenger traffic increased 5.8 per cent to 31.1 million passengers while the number of aircraft movements was up three per cent. This year is not set to be quite as dynamic, but still solid at somewhere between two and three per cent.

Streuli said there are significant plans to develop the airport by increasing the number of aircraft stands, construction of new Terminal A, and a capacity increase, but there are challenges and a bit of a capacity crunch.

“Every growth is welcome but infrastructure wise it is somewhere at the limit,” he observed. “The growth is a little bit faster than the infrastructure enlargement that is taking place especially in the summer with the delay situations and ATC restriction – it is a huge challenge for us.”

“It is a challenge as it is getting more and more unplannable, as you base your staff planning on a certain schedule and of course you already know the schedule will not take place, but the more and more it is shifting around, the more you get problems with staff allocation leading to higher staff costs, which is a key to success in our business.”

Many ground handlers are suffering recruitment woes, in both retaining and bringing in the right staff, but that is not the case at AAS, which takes a flexible approach to staffing of its 350 or so staff members.

“It is a significant issue for some such as my competitors in Zurich, who always complain a lot about it, but we don’t have that problem because you have to think about how you can solve the problem, rather than complaining about it,” Streuli said.

“I think that the core of the problem is that the existing providers have not really adapted their staffing philosophy to this situation. For example, if you put conditions on a guy that he needs to work two weekends a month or two late shifts or early, it is very narrow conditions which are set for new employees and it is getting more and more unattractive for other people.”

The answer at AAS has been to use technology to develop a shift marketplace. The handler puts thousands of shifts up for the future schedule and employees then pick which ones they want to work.

Streuli said: “I do not force them to take shifts and it is completely involuntarily. If I have unattractive shifts like early Saturday or Sunday morning, then I have the flexibility to increase the salary and hourly pay. I think for $50 an hour everybody is willing to jump in and this flexibility gives me quite an advantage towards others.”

He said the innovative approach has been the best solution to address the situation and his only task is to make sure if someone is not showing up, to check if this guy is able to show up and also give them proper training if needed.

Streuli noted technology has been key in this area in providing flexibility for the allocation of staffing and thanks to the online marketplace, it now has only one full-time HR staff member working half a week, as opposed to four five years ago. “It is a self-propelled system and it is working well as I have not faced any staffing issues,” he said.

Although Zurich is the only handling contract at present for AAS, the handler believes the time is right to dip into other markets if the opportunities arise and it is looking at every possibility.

Streuli said it wants to expand and grow and has filed tender documents for a handling contract at vibrant Vienna Airport, where traffic is growing at pace, which if secured would its first foray out of Switzerland. AAS is also looking at the potential to win contracts at both EuroAirport in Basel and Geneva Airport.

“We really think that besides the huge ground handling monsters like Menzies Aviation, Swissport International and Celebi, that there is room for smaller ground handlers to fill in and jump in some gaps,” he said.

AAS was a founding member of the Groundnet alliance, where the five members share know-how and assist each other in different projects ranging from GSE procurement, to IT development, and safety and security.

The current members are Goldair Handling (Greece), AeroGround (Germany), AAS (Zurich), GH Italia (Italy), and Aviator (Nordics), but Streuli said it could expand. “We don’t cover the Western side so France, Portugal, Spain. There are maybe some discussions to expand it in these areas as well,” he said.

“It is stable now and we are getting more and more speed and we have a lot of ground handling companies approaching us and want to be part of it. This is the consequential next move. We want to add new GHs in the alliance.”

TECHNOLOGY WILL NOT CHANGE THE GAME

There is much talk in the industry that investment in new cutting-edge technology will help boost business for ground handlers and solve problems that exist.

However, Streuli said while it helps, it will not change the game completely, as at the end of the day you still need someone to take the suitcases into the aircraft, although it does help improve operational efficiency.

“It helps you to be more efficient. Technology helps increase efficiency – like our marketplace for staffing, planning, and being able to have systematics to better predict the future,” he said.

“We are also working with AI using a tool that predicts what could happen in the future and enables me to improve my planning. This is where we invest a lot of money to have systems for planning and on top of that tracking and GSE to improve the efficiency, so I know for example that I don’t need any more conveyor belts.

“There is a lot of potential to improve operational efficiency – and of course in the passenger side, self-bag drops could lead to more efficiency, but technology will not change the game although it will help us be more efficient.”

AAS was impacted in Zurich by the collapses of Air Berlin and then Germania, but fortunately its other airline clients quickly stepped in to fill the route slots and it event got an upswing out of the changes.

“It is part of the game, but if you want to be in an industry that is certain and stable then don’t step into ground handling as it is highly volatile,” he said. “We believe our portfolio is quite stable and most of our customers are consolidators and not single entities, there are uncertainties, but it is manageable.”