Will Facey, the new EVP ground handling for Europe, Middle East, Africa and Asia at Worldwide Flight Services (WFS), tells Airside about the company’s ambitions in the ground handling segment
There’s no doubt that WFS is one of the world’s leading airline handling companies. Over 300 airline customers at 195 major airports in 21 countries on five continents are testimony to the company’s expertise, and they have pushed WFS’s annual revenues well beyond €1 billion (US$1.2 billion).
WFS’s reputation has primarily been earned as the world’s largest cargo handler. In terms of its ground handling network, it’s still a relative novice – and that’s what attracted Will Facey to his newly created role of EVP ground handling for Europe, Middle East, Africa and Asia. “From a ground handling perspective, it feels like a start-up and we’ve got an open licence to see what we can do,” is how he sees it.
Facey admits to having had a ‘love/hate’ relationship with ground handlers in the past, having been a major customer of theirs for many years. He joined WFS after nine years as easyJet’s head of network operations, leading a team that helped to ensure the best possible travel experience for some 77 million passengers a year. Now he’s in the role of service provider and he’s determined to use all of that experience to ensure WFS is ultimately able to go to the market with something different.
Where it does have a ground handling presence – notably in France, Spain, Hong Kong, Singapore, Bangkok and some airports in Africa – WFS has a robust service offering and a growing customer base, but it’s the untapped potential that attracted Facey to WFS in August of this year. In CEO Craig Smyth he also has a real ally in terms of understanding what it takes to build a successful ground handling network. Smyth had already done it once before as CEO of Menzies Aviation, before he took the helm at WFS in August 2016.
“Obviously, with Craig’s expertise in the ground handling business and the support of WFS’s owners Platinum Equity, it’s a natural step to want to tap into this market again, particularly when you have 300 airline customer relationships you can leverage.
“That’s already happening at the airports where we do have a ground handling presence, with recent business developments in France under the leadership of Delphine Mainguy, and in Spain, where our ground handling business is headed by Jacobo Sitges,” Facey says. Another key factor, he adds, is that the ground handling industry, particularly in Europe, is ready for something new. “To deliver that, WFS is going to have to break the downward spiral of airlines wanting more for less, and ground handlers giving in to their demands.” It’s an unsustainable situation with blame on both sides, according to Facey, but in a world where timing is everything, he sees a shift in the market that a ‘start-up with a pedigree’ like WFS can build a response to. All it needs is some fresh thinking on both sides.
He observes: “Ground handlers are primarily all the same, driven by price. They’ve been pushed down to the lowest possible cost, the lowest margin, but the release valve for airlines has always been the fact that if one handler doesn’t perform, another one will come in. You just go from one to another but the fact is handlers have been pressurised into a ‘price per turn’ environment that has been so intense it has driven them to the floor.
“The first challenge for us is going to be convincing airlines that we actually want to do business in a different way from the others. We don’t want to be the same. Airlines, too, have to take some responsibility and I think they are. What you’re seeing now is a change.”
Facts of life
That change may be being driven by commercial facts of life. Driving down the price per turn to just a few hundred Euros per aircraft is a false economy if it means there is not sufficient, or perhaps any, resilience in your operation to cope when things invariably start to go wrong, Facey considers. Growing public awareness of the flight compensation regulation which entitles passengers to compensation and assistance of between €250 ($295) and €600 ($708) per person in the event of denied boarding, flight cancellations or long delays over three hours has helped to focus the mind.
“The cost to airlines of flight delays and cancellations now runs into millions of Euros in compensation alone. If you have a technical delay to a flight and an intensive flight schedule, that one delay just reverberates throughout the day, so airlines are becoming massively exposed to disruption costs. The simultaneous pressure on ground handling margins means handlers are operating in a way where there is no catch-up capability because there is no resilience built into the way they’re doing business,” he remarks.
It’s clearly time to look at the bigger picture, Facey says. “It means airlines looking at their overall cost of operation, as opposed to siloing everything, and so they might be willing to pay extra for a ground handler that can offer the resilience needed in an intense operating environment” where the ‘domino effect’ can wipe out aircraft and route profitability, to say nothing of customer loyalty. WFS’s global commitment to the highest standards of safety and security will give new customers – and their passengers – further peace of mnd.
So how is WFS going to encourage airlines into its camp? “My experience is that the highest driver of airline customer satisfaction is arriving on-time. You can almost see a direct correlation between on-time arrival and customer satisfaction.
“And what makes an airline on time? It’s not flying, it’s what happens on the ground. Flying can be the most stressful form of travel and so we need to help alleviate that stress. I know only too well what a positive difference a ground handler can make when they do everything right and are fully engaged – and I also know what can go wrong when that doesn’t happen and its impact on a network.
“So I’m doing two things. Firstly, in terms of our existing business I want to get harmonisation of processes, equipment and procedures. I want to get best practice. We need to put efficiencies and good systems in place and achieve good optimisation.
“I also want us to develop a new type of approach that is based on a more open book and being completely transparent with customers. We’ve got to have a margin as well as incentives for efficiencies and innovation. We want to help our airline customers make money but we have to make money too in order to support them and meet the expectations of their customers, and to deliver our commitment to the highest standards of safety and security.
“I would rather have a sustainable relationship with an airline where we agree what the resourcing levels are and what the processes are. If the airline says they need something extra, I’m not going to say no because it’s not in the contract. I want to be able to say that’s fine, when do you want it and these are the additional resources we will add onto the cost-plus approach.”
The worst case scenario, Facey says, is not when a handler says it can’t do something because it’s not in the contract. It’s when they say they can do something and then the need to make cost savings means that the promise isn’t executed. “That just produces failure. A lot of the tension between a handler and an airline is when the airline wants something extra and the ground handler can’t afford to deliver it.”
He accepts that there will still be some traditional contracts with a price per turn but Facey’s priority is to build three-, five- and 10-year relationships with airlines with high-intensity narrowbody operations where WFS has a responsibility to bring customers new ideas, innovations, and economies of scale. It means sitting down with customers to work out the best solutions. Smoothing out airline scheduling, even by a mere 20 minutes at a time, for example, can “make a difference between requiring one team, five teams or 10 teams” from a ground handling perspective. Delivery of both cost and service efficiency just needs open and honest communications from both sides.
One thing it won’t be for WFS is business at any cost. “We will look at everything on a case-by-case basis but it has to stack up in a business case,” Facey promises. “We’re not going to create a footprint just to be able to say ‘look at how big we are’. It’s no good being big if you’re not making money.
“We’re looking at the traditional offering we’ve got now – can we expand that? – whether that’s through targeting individual airlines or bringing it to airports where we think there’s potential in the market to bring in enough business. We are also looking to get ground handling synergies in locations where we have a big cargo operation, and M&A [merger and acquisition] is another possibility.”
Facey’s previous experience will be invaluable as WFS starts knocking on airline doors. “Quite often a ground handler won’t truly know the ins and outs of how an airline operates. They’re only thinking from a handling perspective. I want us to demonstrate that we understand customer satisfaction and what drives that, the disruption costs, the levers for change and that sort of thing. I believe that is going to give our customers and our customers’ customers comfort. We are definitely also thinking from an airline perspective.
“We know it is going to take a bit of time and a few big contracts to prove ourselves in the ground handling market but we have a chance to change things in a sustainable and innovative way that will benefit us and our customers.”