Tyler’s Balancing Act
A version of this article appears in the May 26 edition of Aviation Week & Space Technology.
Three years ago, an era ended at the(IATA) and a new one began. At the annual general meeting in Singapore, then- CEO Tony Tyler (see photo) was elected as the organization’s director-general and CEO, succeeding Giovanni Bisignani, who had held the position for eight years.
A lot has changed since, but not everything. There have been changes within IATA in the way the organization presents itself to the outside world, and the focus has shifted to different topics. When the organization’s members meet for this year’s AGM in Doha on June 1-3, few will disagree that Tyler has been the right choice at the right time.
The industry had become weary of Bisignani’s overly aggressive and confrontational style. Tyler had to rebuild some important relationships both inside and outside the world’s airlines’ lobbying organization. His approach is much more engaging and friendly than Bisignani’s, but style issues aside it is different in other ways too. While Bisignani had an “agenda for freedom” in mind—his vision of a liberalized global air transport industry that is more or less free to do what it wants (merge, among other things)—Tyler’s approach comes across as a lot more pragmatic. This does not mean he disagrees with a lot of the targets Bisignani worked hard to meet, but sometimes big egos get in the way and style matters.
Tyler clearly does not need to be on center stage all the time. He is more into quiet diplomacy, so most of his small victories are invisible to the outside world. One major success is integration of the new breed of Middle East carriers into the organization. They had bitterly complained under Bisignani that a club of old-school few was running the organization, not wanting to accept that others have grown up in the meantime. Now Middle East airlines have a seat on IATA’s board of governors and are represented byCEO Akbar Al Baker. The new realities of the industry also are reflected by the fact that the airline CEOs are meeting in the Qatari capital of Doha this year, not London or Chicago.
But even a skilled man at the top such as Tyler cannot overcome some fundamentals that will always weaken the organization and constrain its room to maneuver: Most important, IATA’s members have hugely divergent interests. Just look at open skies, where the differences could not be greater: There are the ultra-conservatives such asthat think the current bilateral air service agreement is just fine; it happens to serve that airline’s interests well. On the other hand, there are carriers such as the big Gulf airlines— , Emirates and Qatar—that want the exact opposite, because liberalized open skies will serve their interests. And there are the many other airlines in between that are sometimes in favor of more liberalization if it suits their needs and sometimes not.
The debate about less regulation has been shifting of late. It is not so much about only traffic rights anymore; it is about effective ownership and control. Some European carriers provide the perfect example. Many midsize airlines—, Portugal, LOT Polish, to name a few—would love to see restrictions fall as soon as possible, to attract foreign investment from Etihad or Hainan Airlines or the Latam group.
Others such asand - are vigorously opposed, as they are concerned that their fiercest competitors will become even greater threats. All of them are, of course, members of IATA and some are quite influential. So Tyler and IATA face a tough balancing act because there is a big difference between official positions and actual behavior. Officially, the industry and most of its players favor open skies and eliminating ownership and control limitations.
But when their own interests are negatively affected, the airlines all too quickly change their minds. Just ask Etihad, which went to significant lengths to circumnavigate what most admit are outdated rules when it came to putting more money into Air Berlin. And United or Delta would happily promote open skies one day, but find complex legal reasoning to try to block Norwegian from winning U.S. approval for its new long-haul affiliate NAI. Lufthansa is also all for opening up when Indian routes are the subject, but when it comes to the United Arab Emirates, the answer is: No, thank you. IATA must drive change when it will benefit most of its members. Now is the time.