There is something very straightforward and logical about Worldwide Flight Services’ (WFS) new approach to ground handling for narrow-bodied, high-volume passenger operations in Europe, the Middle East, Africa and Asia – but it could herald the start of a revolution in airline-handler relationships, beginning in Edinburgh
WFS is firmly established as the world’s largest air cargo handler, serving more than 270 airlines globally across a network spanning 198 major airports in 22 countries. But when it comes to ground handling, it is still – relatively speaking – the new kid on the block, and that’s a situation WFS plans to use to its advantage.
The handler says it is thinking like an airline and offering a fresh alternative to traditional ground handling contracts, which tend to focus largely on driving down costs, often causing handlers – and, arguably, airlines too – to lose sight of what is most important, notably operational resilience and passenger satisfaction.
When Craig Smyth took the helm as CEO of WFS in the summer of 2016, he brought with him the experience of building a successful ground handling network within a major handling organisation. One of his first tasks was to put the necessary building blocks in place to replicate that success at WFS, leveraging its strong airline relationships and reputation for quality handling gained over more than 45 years in the cargo business.
In the Europe, Middle East, Africa and Asia (EMEAA) region, the person tasked with leading this handling revolution is Will Facey, executive vice president EMEAA ground handling.
An airline man who had spent his previous nine years as head of network operations for one of the world’s leading passenger carriers, helping to ensure the best possible travel experience for some 80 million passengers a year, Facey was not about to be bound by tradition.
“We always intended to come to the market with a fresh approach to improve the quality of ground handling that airlines and passengers receive,” he says.
“Traditional ground handling contracts are based on aircraft turns, handling arriving and departing flights, but there’s a much bigger picture for both handlers and airlines. We saw a situation where airlines had drained down the price of their ground handling and, effectively, many carriers got what they paid for.
“Ground handling is quite a low margin business, so you’re seeing people trying to optimise all the time, but if you drive handling costs down to rock bottom, although you may think you’re saving money, what you’re really doing is removing the resilience you need to sustain your operation, and the penalties for that can be huge,” he points out.
WFS’ ground handling business model is designed to deliver a reality check, to focus on quality, safety and security, and to remove the commercial tension from airline-handler relationships which stems from handlers “scrambling around to improve their margins and airlines always seeking more than they’re paying for”.
This fresh approach is aimed firmly at narrow-bodied airlines with high volume operations. It delivers a straightforward cost-plus proposition in which, as Facey puts it, “everyone knows what they’re getting, what they’re making and what they have to lose”.
He explains: “Our contracts are flexible, realistic and commercially balanced. If an airline customer wants more, we put more in and they pay for it. If they want less, we take it out and the cost goes with it. At every point, we’ll tell them what the cost is and what we’re making out of it.
“It’s about having a balanced relationship. We’d rather be up front and have an honest conversation with a customer because, ultimately, you end up with a solution that is resilient, open and transparent,” he adds.
‘Resilience’ is a word Facey uses a lot, and it stems from his experience and clear understanding of what it takes to deliver a robust airline operation.
He admits that WFS’ new approach may not come easy for some carriers – but he is starting to see a step change in airline thinking, so the timing may actually be perfect.
One of the things helping carriers to see the bigger picture is the EU’s Flight Compensation Regulation 261/2004, the law establishing common rules on compensation and assistance to passengers in the event of denied boarding, flight cancellations, or long delays of flights.
Facey remarks: “At last, we can see some of the more progressive airlines looking beyond pure ground handling costs and thinking about global airport operations costs. There is a growing realisation that if you only focus on the cost of handling, as soon as you have a challenge to fix your operation almost certainly won’t have the resilience to deal with it.
“Then there’s a serious knock-on-effect to the performance of the airline and also the airport concerned. It leads to delays, issues with crew duty hours, and disruption in the form of flight delays and cancellations. And, because of EU261 legislation, the associated costs can be huge for airlines in terms of compensation.”
The potential compensation of €30-40,000 when a full 200-seat passenger flight is delayed or cancelled, plus in some cases added overnight accommodation costs, certainly focuses the mind when it comes to making sure your handler is able to do their job effectively and consistently. In any case, Facey says, a well-run operation can find cost efficiencies elsewhere.
“When you look at total airport costs, if you’ve got good resilience in your operation, you can probably reduce your overall operational costs because you have less delays and cancellations. In some cases, your ground handling costs might have gone up, but when you look at the bigger picture – and consider the penalties of getting it wrong – it just makes good commercial sense.”
WFS recently began serving easyJet at Edinburgh Airport (see panel). As for the future, the handler is looking for other airline customers at other airports that match its business model and buy into its new way of engagement.
“Our ambition is to grow profitably so we’re not going to take any gambles in terms of setting up speculative ground handling operations. Every new airport has to have an anchor customer and it has to have a profitable relationship. We have a clear vision for our business and believe it is also the best way forward for the airlines we aim to work with.
“If you consistently give airline passengers the quality of service they expect, they will want to experience it again and again,” Facey concludes. |