International aviation fuel supplier Air BP is marking 90 years of operations this year which positions the UK-headquartered company as one of the most experienced in the field. With the aviation industry facing an increasing number of challenges Air BP aims to support its customers by providing them with tailored services, which extends beyond just the supply of fuel.
Airlines across Europe are seeing profits soar through cheaper fuel enabling them to benefit in a number of different ways that have enabled previously marginal routes to become attractive to fly again. “From an economic point of view this leads to growth of the business of our customers, the airlines, and if our customers grow their business, Air BP as a fuel supplier can grow with them,” said Alexander Junge, Managing Director, Northern Europe, about the effect of cheaper fuels on the Air BP business.
“In my opinion, it is an illusion to assume that hedging should earn money or save money. Sometimes it does, sometimes it doesn’t. However what it always does is buy time. And this is the objective of hedging.”
Alexander Junge
Managing Director, Northern Europe, Air BP
Other factors affecting an airline’s fuel costs include hedging. “In my opinion, it is an illusion to assume that hedging should earn money or save money. Sometimes it does, sometimes it doesn’t. However what it always does is buy time. And this is the objective of hedging,” he said.
Hedging will give airlines the certainty that for a certain period of time the price will be X, and that can be worth a lot when planning budgets. “It can buy your company the time needed to adapt to a changing price environment. Of course that works in both directions. It might also delay your participation in better prices,” Junge added.
A challenge for the aviation industry moving forward is how it will work towards a lower carbon future. The anticipated growth in travel predicted by IATA (anticipated to double over the next 20 years) is plausible. So it is a growing market, but at the same time consumers are becoming even more focused on sustainability. “The use of biofuels, and working towards a low carbon future will become more important,” said Junge.
Air BP aims to support the wider aviation industry goals towards a lower carbon future through responsible practice and by leveraging its unique position as an aviation fuel supplier to support customers; airlines, airports and pilots. “We are uniquely placed to do this and will be launching our Environmental offering in the near future,” added Junge.
As demand continuously increases Air BP is providing a tailored offer defined by the needs of its customers. The profile of Air BP customers is varied including airports and airlines around the world, in fact it operates out of 700 locations internationally and customer needs vary greatly.
Alexander Junge will be among the participants at this year's Routes Europe in Krakow, Poland between April 23-26, 2016. He will be making a presentation at the Strategy Summit on the afternoon of April 24, 2016 where he will discuss how Air BP is working with the industry to fuel moves to a sustainable future.
Many pilots and operators participate in the company’s Sterling Card program. “It is critical that we have the ability to support a small customer who may wish to offset his or her carbon footprint, who may wish to use UL91 as their small contribution, or an airport in acquiring knowledge of how to deploy stop - start technology or offer Biojet supply,” said Junge.
“Undoubtedly it is challenging as many initiatives may require investment and infrastructure changes. What Air BP is able to do however is work with our customers, within their parameters, to support their unique requirements,” added Junge about the company’s approach to supporting customers in their goal of achieving a lower carbon future.
Currently the market by and large confines the fuel supplier to a narrow role, limited to supply and logistics of molecules. Air BP is an integrated part of the aviation industry and as such offers many value-adds to its’ customers, that support fuel efficiency, disciplined and safety conscious operational standards and that ensure best practice. Reliable supply is considered a given, as it should be. Air BP also aims to actively support the commercial goals and agenda of customers through technical expertise, and developing strong relationships with the companies with which it works.
The biofuel debate continues but Junge said in his opinion there has been an impressive response from the industry. “This is evident in the participation of Lufthansa, KLM and SAS in our Biojet launch in Oslo, and the continued steps being taken within the industry as more airlines and OEMs explore the opportunities of operating with Biojet,” he explained.
What is clear is that no one action will swing the pendulum argued Junge. “A lower carbon future will come from a combination of actions including greater fuel efficiency, responsible operations at airport level, sustainable fuel, carbon offsets and technological advancements which will all contribute to the overall aim,” he concluded.
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