AB25: Former British Airways chairman and CEO, Lord Marshall

By:  
-
Source:
This story is sourced from Airline Business
Subscribe today »

By: Lord Marshall

Former Chairman
British Airways

 

"The three issues to have emerged for air transport are security, security and security" 

 

lord marshall

Working in air transport, alongside wonderfully committed people was, for me, a great and fulfilling experience. Over the past 25 years, I learned that it was not a business for those of a nervous disposition or anyone seeking a quick profit.

Looking at air transport from the outside, it does appear to be a curious business. It is, in general, a growth industry, but collectively has never made any real money in its history; it has been prohibited by international regulation from normal commercial development; competition has been distorted by various forms of government support for effectively down-and-out carriers; and the industry's infrastructure suppliers have traditionally been monopolies. Yet the business has continued to attract enthusiastic new entrants.

The truth is that most airlines are essentially go-ahead, enterprising businesses. Regrettably, they have been trapped in a suffocating industry environment. Air transport has, over the years, produced outstanding - even breathtaking - technological innovation, and has married this to truly advanced customer service practices in a complex of logistics. The fact that it works apparently effortlessly and safely much more often that not, at amazing levels of value for money, smacks of technical, organisational and business genius.

It was so sad, therefore, that over the past couple of decades, terrorism, war and pestilence have caused such devastation. Great fortunes have been lost and some major airlines have gone out of business. Other issues, such as oil prices and global economic downturn, may be at the top of the new agenda, but - to paraphrase a political cliché - the three defining issues to have emerged for air transport are: security, security, and security.

The additional costs of policing and protecting the industry's assets, its people and its customers are immense but obviously essential and I cannot see them ever reducing in real terms.

So we have a situation in which contemporary air transport, like so many industries these days, is struggling to reinvent itself in the face of rising costs and operational constraints on the one hand, and a deflationary marketplace on the other. As ever, the pressing need remains to reduce overheads and further invest in competitive development at the same time.

A significant development has been the harnessing of advanced information technology. Electronic distribution and customer service inventions had been emerging for some time, but I think it is only fair to acknowledge that the industry has been spurred on by the new low-cost carriers. These relatively new entrants, coming fresh to deregulated markets, have been good for the industry. E-business is certainly the way of the future.

One major regret is that we have still not been able to achieve sensible global liberalisation. Progress has - and clearly is - being made, but the fact that airlines cannot undertake the kind of cross-border merger and acquisition available in every other major business sector seems perverse in this day and age.

Compare that backward situation with the astonishing technological advances over the past 25 years. They are manifested in the remarkable A380 and Boeing 787, as well as the evolving range of short/medium-haul equipment. They all represent quite astounding technical advances, including vital new levels of fuel efficiency and environmental care.

Whether we will see a supersonic, or hypersonic, successor to Concorde is very difficult to say. Somehow, though, I can't imagine that air travellers of this century will, for too much longer, be flying at half the speed their predecessors were 25 years ago.

I have the same great hope for the future of the industry that I did 25 or more years ago. Let's face it, without air transport, the world as we know it would, quite literally, come to a halt.

lord marshall, rex features

Lord [Colin] Marshall was appointed chief executive of British Airways in 1983. He became the airline's executive chairman in 1993, before retiring in July 2004.

 

FROM THE ARCHIVES

Marshall's tenure at BA oversaw the company's transformation from a state-owned carrier following its privatisation in 1987 through to the retirement of the last of the carriers iconic Concorde fleet in 2003. He stepped down as chairman shortly afterwards.