2 Global Airline Industry Almanac | A spotlight on key trends in 2017 Methodology For this report, Amadeus undertook primary and secondary research in associationwith Connections Events, Jacobs Media Group, Fire on the Hill, T2RL and variousindustry experts. The report is a summary of events that took place in the airlineindustry during 2017, which does not refect the opinions of Amadeus or the partnerorganisations, unless directly quoted in the report. Our approach Conducting interviews and gathering insights from Amadeus industry reports,Amadeus and industry executives, third-party sources and other prominent airtravel research in 2017. We thank all of the participants, most of whom are quotedthroughout the report. About Connections Connections is part of Jacobs Media Group, Europe’slargest B2B multimedia publisher and events organiser for senior decision-makersin the travel industry. To fnd out more, visit weareconnections. About Fire on the Hill Fire on the Hill is a London-based corporatecommunications agency specialising in complex issues management and thoughtleadership communications. The team specialises in the travel, aviation andtechnology industries, working with large enterprises and innovative start-ups. About T2RL Travel Technology Research Ltd, trading as T2RL, is an independentresearch and consulting company that specialises in the marketplace for airline ITsystems. Based on data gathered and analysed since the year 2000, it has defnedand tracked classifcations of airlines and their IT providers. T2RL’s classifcation ofairline business models is unique and is based on whether or not an airline has 10 keyattributes: codeshare, interline, GDS distribution, connecting services, internationalservices, long-haul fights, multiple aircrafs, multiple classes of service, multiplefares available at one time and ticket issuance. T2RL calculates a score for eachairline based on these attributes and then classifes them as follows: airlines scoring0-3 are considered Low-cost carriers; between 4-7 are considered Hybrid carriers;and between 8-10 are considered Network carriers. To fnd out more, visit t2rl.The information contained in this Almanac has been assembled from many sources,and while reasonable care has been taken to ensure that the information in thisdocument is accurate, Amadeus assumes no responsibility for any inaccuracies orerrors that may be contained herein. Index Executive summary 4 Airline alliances and partnership models 6 Improving industry collaboration8 Regional aviation overviews 11-21 The airline traveller 23-27 Shopping: from prospects to customers 28-31 Corporate travel and loyalty 32 The travel experience: door-to-door, airports, disruption, in-destination 35-41 IT and innovation driving change 43-45 Conclusion 47 Global Airline Industry Almanac | A spotlight on key trends in 2017 3 Foreword 2017 was a successful year for our industry. Many airlineshave seen more-robust balance sheets, driven by the strongand growing demand for air travel across the globe despite theloss of some long-established airlines. Whether your focus was the introduction of a new businessmodel or industry-wide standards, this was a busy yearwith signifcant change for airlines. That is why we felt itparticularly important to invest in this retrospective view of just some of the keyevents and trends of 2017. New technology, business models and partnershipapproaches are taking root, and we hope this report supports the industry in itsdrive to improve both business and technical development during 2018 as wecontinue to innovate and digitally transform our industry together. When I refect on 2017, I am reminded just how competitive the operatingenvironment remains for all carriers. It is in this competitive context that manyairlines have fourished, fnding the time and resources to dedicate to the ultimatecustomer for us all, the traveller. Our continued investment in innovation is focused on delivering robust solutionsthat support our airline customers to overcome many of these complex challengesacross all channels to market. When we consider that technologies such as cloudcomputing and big data analytics are already maturing, we must continue to lookahead to new innovations in areas such as artifcial intelligence and blockchain. At Amadeus, we recognise the ongoing pace of change in the industry and we arededicated to delivering technology that supports all our airline customers to growand improve their businesses. I look forward to working with you in the year ahead, in support of your chosenbusiness strategy. Julia Sattel, Senior Vice President, Airlines, Amadeus4 Global Airline Industry Almanac | A spotlight on key trends in 2017 Executive summary The scope of the topics covered within this Almanac isextensive. This summary offers a selection of key trendsand developments outlined herein. _Industry profitability rose across the board: _North American airlines’ total net profit of $15.6 billion _European airlines generated $9.8 billion _Asian airlines generated $8.3 billion _Latin American airlines generated $700 million _Middle East Airlines generated $300 million _Ancillary services continued to drive profitability with salesworth $82 billion in 2017, an increase of 22% on 2016 _Several network carriers launched ultra-low cost fares in response to competition from LCCs _Low-cost long-haul flights became a growing reality in2017 for established airlines such as Norwegian, as wellas new players such as IAG’s Level entering the market _‘Bleisure’ trips rose with the number of leisure trips thatalso include a business component increasing to 17% in2017, up from 11% in 2012 _NDC adoption accelerated with 33 airlines now ‘live’, asexemplified by Finnair’s project enabling bookings to bemade directly within the Skyscanner platform _Digital transformation rose in prominence with keyairline innovation focused on digital touchpoints,customer acquisition, merchandising, payments, dataanalytics and the use of chatbots _Greater technology-enabled collaboration occurred atthe airport with the introduction of Airport CollaborativeDecision Making systems and preparations for IATA andACI’s ‘NEXTT’ initiative that will see new experiencesdelivered by airport stakeholders using artificialintelligence and data sharing _2017 saw increased use of APIs to connect airline systemssimply and provide access to developers. _Airlines continued to pursue innovative and unconventionalnew partnerships, for example Jet Airways integratedUber into its own app allowing passengers easier onwardjourneys _2017 underscored the fact that regional nuance persistswith distinct operating environments, opportunities andchallenges for airlines based on the markets they serve.Objective of this Almanac:To provide a reference source for keydevelopments in the airline industry in 2017to help the industry innovate further during 2018 In light of theincreasing speedof technological change,airlines are experimentingwith initiatives such asNDC and ONE Order, which are keyaspectsof digital transformation acrossthe aviation ecosystem. These initiativeswill enable airlines to deliver value bysimplifying shop-order-pay processes andaccelerating their retailing strategies. Inparallel, we are evolving the way we design,build and take our solutions to market toenable a successful transformation for the airlines’ travel ecosystem Fabrizio Calcabrini, Vice President, Airlines Solutions, Amadeus。。。。。。