Back to Air Transport IT Review - Issue 3, December 2009
Baggage improvement: truth or hype?
Dominique El Bez
Director, SITA Portfolio marketing
There may be less mishandled baggage, but is it the start of a sustained improvement in baggage handling or just a temporary respite due to the sharp drop-off in check-in luggage?
After five years of rising mishandled baggage levels, airlines finally had some good news to cheer when the 2009 Baggage Report was published. The number of bags mishandled in 2008 had dropped by over 20% to 32.8 million from 42.4 million the previous year, providing an $800m windfall.
But is this because less baggage is being handled?
Inevitably the introduction of charging by airlines has had a large impact on the total number of bags checked-in by passengers, reducing the strain on the global baggage handling system. According to the baggage report, American Airlines saw its average number of checked bags fall to less than one per passenger, down from 1.2 per passenger before it introduced fees. Although only a single example, it represents a near 20% drop, in line with the global decrease in misplaced baggage.
Nevertheless baggage charges, although common in North America and Europe, are not applied by every airline and when they are, the first bag usually travels free. It also doesn't fully explain the 25% drop in the rate of mishandling, which has fallen to 14.28 bags per thousand passengers in 2008 from 18.86 bags last year, despite passenger numbers remaining broadly flat at 2.3 billion. Those bags failing to show up at all also fell to 0.32 bags per thousand passengers compared to 0.57 per thousand passengers in 2007, indicating that tracking and tracing of baggage is now far more robust.
So is the concerted effort by airlines is starting to pay off?
For a number of years, airlines and airports having been working hard to tackle the issue that costs the industry $3 billion dollars a year. IATA has a dedicated team working on the problem, visiting the industry's worst mishandling hotspots and developing tools and processes that can solve 90% of mishandling issues. Results so far indicate it is making a big difference. One airline saw its mishandling cut in half in 2008, while another carrier reduced its mishandling by 30% at a US airport. The 'Baggage Improvement Program' (BIP), as it is known, aims to cut global mishandling in half by 2012.
When do bags go missing?A mishandled bag is a report of a delayed, damaged and/or pilfered bag recorded by an airline, or its handling company, on behalf of a passenger, for handling as a claim. IATA's Baggage Improvement Program (BIP) proposes to cut baggage mishandling in half by 2012 - generating annual savings to the industry of between US$ 1 and US$ 1.9 billion, depending on the number of issues each BIP participant decides to address. The programme focuses on five key areas:
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Using modern technologies
Technology is also playing its part. RFID track and trace systems, such as the one SITA integrated into the baggage management system at Hong Kong International Airport, is improving the integrity of baggage sortation systems resulting in fewer misplaced bags. The uptake is likely to be slowed by the current economic situation but nonetheless the number of airlines already using RFID for baggage handling has grown sharply from 2% in 2007 to 11% in 2008, with a further 32% of airlines expecting to use RFID by the end of 2010.
Mobile technology, such as data-centric handheld devices, is also making the handling, sortation and tracking of baggage far more productive. A good example is Chicago O'Hare International airport, which applies strict passenger-bag reconciliation using SITA BagManager. The use of wireless devices to scan the bag tags provides positive confirmation that the bag being loaded is intended for that flight. According to Swissport, the main ground handler at the airport, no bag has been loaded onto the wrong flight while the system has been in use.
This type of improvement is starting to be noticed by the wider industry. By 2012, almost half of airlines will be equipped with wireless and handheld devices to support staff operations in baggage handling, sortation and tracking (2009 Airline IT Trends Survey).
Technology is also being considered around bag tag receipts. With the adoption of the BCBP standard - capable of being sent to passenger mobile devices and enriched with bag tag receipt information - a growing number of airlines are considering sending electronic bag tag receipts direct to passenger mobile devices. By 2012, 27% of airlines surveyed in the 2009 Airline IT Trends survey expect to provide this capability, as discussed in our Airport IT Trends article.
Regardless of the underlying reason for the improvement in baggage handling, passengers themselves appear less concerned with baggage issues, implying improvements are being noticed where it counts - with the customer. Those interviewed for the 2009 Passenger Self-Service (PSS) Survey rated "receiving checked baggage promptly and safely on arrival" as only the fourth most important criteria that they associated with a pleasant trip compared to its ranking second in the 2008 and 2007 surveys. Similarly, only 9.3% of respondents said that "waiting for checked baggage on arrival" was the step of their journey they would most like to change, down from 15.8% last year.
In more detail ...If we look at the 2009 Airport IT Trends survey in more detail, baggage processing and management remains among the highest ranked investment areas for the Top 100 airports (51%), but is a lower priority for less congested, smaller airports. Moreover, it is important to note that the proportion of passengers checking-in baggage has dropped from 82% in 2007 and 2008, to 75.7% in 2009, as per the 2009 Passenger Self-Service survey. This trend is especially noticeable in locations where airlines started charging passengers extra for baggage. |
Initiatives making a difference
This more positive attitude from passengers and new self-service initiatives aimed specifically at baggage laden travellers should see levels of hold luggage start to rise again. Baggage was cited as the primary reason why people did not use self-service check-in when they knew it was available in the 2009 PSS Survey.
The 'Bags-ready-to-go' project under IATA's Fast Travel initiative (part of the Simplifying the Business program) enables passengers to self-tag their bags at a kiosk as part of the self-service check-in process, before depositing them at a bag drop. A parallel procedure allows passengers who have checked-in off-airport (using the web or a mobile device) to go straight to the bag drop for faster processing.
A second Fast Travel initiative should bring faster relief to those passengers that do have their bags mishandled. Kiosks, situated in baggage halls will allow passengers to complete the reporting of missing baggage, thereby avoiding the need to queue for an airline agent. SITA has released of the world's smallest kiosks in air travel.
Door-to-door baggage handling
Currently these types of projects are focused on improving airport-to-airport baggage management. The next step will then be to work on the peripheries to develop a complete door-to-door baggage system. Eventually, passengers should be able to check in luggage with confidence from the comfort of their own home and track it like a DHL or FEDEX package throughout its journey, before being re-united with it at their destination. Parts of the vision are already in place. Off-airport baggage check-in is already offered by some 15% of airlines, and another 18% plan to offer the service within two years. The idea is increasingly popular with passengers, with almost 60% saying they would use the service if it was available (compared to less than 50% last year).
Baggage pressure will resume
How much of the lower baggage mishandling is down to less baggage and how much is a result of better handling is open to debate, but either way it is good news for passengers and the industry alike. However, one set of results does not make a trend and so we will only have a clear view of whether the combined efforts of the industry have got to grips with this issue when passenger traffic resumes its upward trend over the coming years.
References
Airport IT Trends Survey 2009
Passenger Self-Service Survey 2009 (see also the article in this issue)
More information about the IATA BIP and Fast Travel initiatives are available at www.iata.org/stb.
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