June 25, 2024

Braced for change

Zavier Rossinyol, chief executive officer gategroup, looks back at a turbulent year and positions the business for challenges ahead

2019 was a challenging year for the aviation industry, driven by a combination of internal and external factors. While passenger levels continued to grow – the summer peak season surpassed that of the record-breaking 2018 – declining global macro-economic KPI’€™s have driven IATA to reduce revenue passenger kilometers growth forecasts to 5% for 2019, below the average 7-8% growth over the last three years.

Ongoing industry consolidation is still anticipated, particularly in Europe where overcapacity remains an issue and carriers are still some distance from steady growth. US carriers have focused on partnerships to further strengthen their geographical footprint, notably Delta Air Lines with LATAM and United Airlines with Avianca.

We have also witnessed several airlines suffer severe financial difficulties in 2019, from the collapse of the world’€™s oldest holiday firm Thomas Cook and the bankruptcies of Germania and Wow, to the grounding of Jet Airways. The grounding of the Boeing 737 Max added to existing challenges, resulting in routes being cut or contingency measures taken to ll the lack of aircraft available to serve them. Political unrest in Hong Kong and several countries in Latin America have led to reduced travel access and demand, thus slowing down growth investment plans by airlines.

In early 2020 the world’€™s attention turned to COVID-19 (Coronavirus). The economic impact on the the aviation, tourism and trade industries is not yet known, but we cannot deny it will be very significant. We continue to work in close cooperation with authorities, customers and airports to assess and address the impact of COVID-19 on our industry and have implemented additional measures to protect the health and safety of our employees, customers, passengers and general public.

The industry has also come under intense scrutiny to acknowledge and address their environmental impact, ranging from reducing carbon emissions, barring single use plastics onboard to finding solutions for reducing food waste. The industry must and will reshape their overall approach to sustainability, and early adopters have already begun to embrace this change.

Changing the way people experience travel

gategroup bridges the world of culinary and aviation. When we launched our Gateway 2020 strategy in 2015, we had a clear vision: to transform our industry. With a solid focus on our core business of airline catering, our goal was to set a new industry standard. We also wanted to change the way people experience travel – through culinary and hospitality – and to do so in a sustainable manner.

Our leadership in commercial innovation has been driven by three key areas: Creating an unparalleled and distinctive culinary offering: we call it our Culinary Revolution; utilizing state-of-the-art data analytics through our Data Revolution; and becoming a leader, not a follower, in sustainability through our Green Revolution. These three revolutions are underscored by our leadership in operational excellence and standardisation, with our 13 Competence Centers around the globe that develop, test and implement innovative operational best practices and function as an academy for the rest of the network.

How exactly do we differentiate ourselves from the rest? gategroup is focused on innovating and delivering value to our customers by providing passengers with a superior culinary offering based on food trends, quality and freshness. In combination with delivering innovative products and services that address the needs of today’€™s discerning passenger we are changing perceptions of what airline catering can be.
This has resulted in signing a number of long-term contract extensions with some of our key customers in 2019. We were also able to renegotiate terms with several key customers, underscoring their belief that gategroup is a strong partner that delivers value through our unique offering.