Montreal - March 6, 2013 Maintenance Cost Task Force (MCTF) 1

Airline Operational Cost Task Force (AOCTF)

Airline Cost Management Group (ACMG)

Feb 2015

Airline Cost Management Group (ACMG) Mission

The AOCTF strives to share cost management best practices while

providing airline industry platform for effective cost benchmarking

Objectives

Share best practices for effective cost management to achieve

profitability and foster sustainable airlines

Support the industry efforts to better understand cost drivers &

trends, manage operational costs

Refine and standardize definitions and methods from a

management accounting perspective

Provide AOCTF members with an annual report, analyzing

major cost drivers, identifying industry trends

Airline Cost Management Group (ACMG)

Recent Developments & Way Forward

2012 2013 2014

Steering Committee

Formed in 2013, consists of 10 airline members:

Chairman, Josua du Plessis, SAA

Vice-Chairman, Dimitrios Tziortzis/Ramanpreet Boparai, Air Canada

Larry Gibbons, Atlas Air

Hassan Mohamed Hassan, Egyptair

Valdimar Bjornsson, Primera Air

Suha Alarda, Royal Jordanian Airlines

Ashraf Suleman, Saudi Airlines

Luis Miguel Pestana Rosa, TAP Portugal

Faik Ozan Dulger, Turkish Airlines

Yuliya Gerasymchuk, Ukraine International Airlines

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ACMG brings real value to airlines

Airline Cost Management Group (ACMG)

Throughout the past 2 years 15 recurrent airlines saved close to 1 billion dollars

ACMG Report Structure

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Introduction

Overview of the AOCTF Airlines

Airline Cost Structure

Strategic KPIs

Operational KPIs

Aircraft Type Analysis

Detailed Analysis of B737NG and A320 family

Towards the Enhanced ACMG Report

Airline Cost Management Group (ACMG)

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Key Highlights

Airline Cost Management Group (ACMG)

Global Representation

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Aircraft Mix

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Average Stage Length

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Airline Cost Structure

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Strategic KPIs

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Financial Performance

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Airline Cost Management Group (ACMG)

Operational KPIs

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Fuel Cost and Efficiency

Staff Productivity

Employments Costs

Fuel Cost and Efficiency

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Fuel Cost and Efficiency - continued

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Staff Productivity

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Staff Productivity - continued

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Aircraft Type

Analysis

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* Please note that this diagram is based on raw data provided by ACMG airlines. As every airline operates in a unique environment, this analysis might deviate from the one provided by OEMs.

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* Please note that this diagram is based on raw data provided by ACMG airlines. As every airline operates in a unique environment, this analysis might deviate from the one provided by OEMs.

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B737NG

Detailed Analysis

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Enhanced ACMG Report

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Incorporate feedback from the Conference

Include additional ACMG members

Some other features of the Enhanced ACMG Report:

Special focus on impact of Fuel Hedging

Special focus on impact of Exchange rates fluctuations

We’re not done yet!

We went even a step further this year…

All-New Specialized ACMG Report

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The standard ACMG Report offers great value at a global level

Direct comparison very challenging due to many factors

For the first time we offer a customized solution

Unique to every airline

Even more insight into industry best practices and cost efficiencies

through improved benchmarking precision

Contact us on acmg@iata.org for pricing and more info

Way Forward

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Participation: ACMG evolution indicates between 60 and 70

airlines will provide data FY2014, will you be among them?

Support: Promote the value of ACMG, send us testimonials,

consider ordering Specialized ACMG Report

Involvement: ACMG Steering Committee will increase after the

Airline Cost Conference, will YOU be our new SC member?

Input: We need your comments and suggestions to improve

ACMG has a proven track record

but we want to fly even higher

Airline Cost Management Group (ACMG)

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A word from our Chairman

Airline Cost Management Group (ACMG)

“The ACMG is the most comprehensive, high level

benchmarking study available that encompass

different size airlines from 5 continents, operating

different models that is continuously updated, and

most importantly, is FREE. Because the data is

available by fleet with the cost drivers it empowers

Management to evaluate their performance.”

Josua du Plessis, SAA Strategic Projects Manager

Thank you!

Q/A

Klemen FERJAN, MBA

Consultant, IATA Operations

FerjanK@iata.org

More info on

www.iata.org/acmg,

ACMG@iata.org

ACMG Team IATA Operations, Montreal

Chris Markou, Assistant Director

Klemen Ferjan, Cost Management Consultant

Geraldine Cros, Operational Cost Manager

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