Kevin McQuillan has experience by the planeload in promoting British Airways in foreign markets. The airline’s regional general manager for the Far East started with the company in its general management training program 11 years ago. He then worked in senior sales and marketing roles in the US and Southeast Asia before taking up his current position in March 2009, overseeing BA’s operations in Greater China, Korea and Japan. He spoke to CHINA ECONOMIC REVIEW about growing BA’s business in China during an economic downturn and the effect of swine flu on business.
Q: How would you describe your relationship with China’s aviation bureaucracy?
A: We now have a good relationship with the General Administration of Civil Aviation in China, the airport authority, and the Air Traffic Management Board, which controls the airspace. We had to work alongside these departments in order to get the sixth day of service [in Shanghai] that we had been working on for some time. Due to the amount of airport traffic in Shanghai – and across all airports in China – it can be pretty hard to get landing slots without close cooperation with all the government departments.
Q: How long did it take to negotiate the extra slots?
A: We’d been working on it for a number of years. There had been slots available but not ones that work for our arrival times at the other end. The most congested times are when most international carriers need the slots to fly into Europe. So we have been offered slots in the past but not at times that were workable. It was through cooperation with the various bodies that we were able to get there.
Q: What other challenges are you’re facing?
A: Being a foreign brand in a Chinese market is pretty hard in terms of brand awareness and so for getting local partnerships with customers and corporations are very important. Certainly, economic conditions are probably the biggest challenge and that’s something we’re working on pretty hard at overcoming in China because we realize that it will be one of the first markets to pick up.
Q: What are you doing to prepare for an eventual revival?
A: What we’re doing now is no different from what we’d be doing otherwise, things like making sure we understand our customers – that could be individual travelers, business corporations, travel agencies as well. We really need to understand businesses’ needs so we can drive true partnerships. Similarly, we’ve focused more on the small and medium-sized enterprise (SME) market. Earlier this year we launched our mainland China corporate travel program which was designed for SMEs that don’t have the same travel needs or the same travel budgets as larger companies. We work with the companies directly or through their travel agent of choice and it gives them access to an upfront discount as well as access to a consultative approach that can help them out with their travel and their travel program. That’s been quite successful. We also recently just signed a three-year partnership with the China-Europe International Business School, which provides their development fund with British Airways flights over the next three years, in support of the school’s international cooperation and communication programs.
Q: How have you been dealing with the effects of swine flu on travel?
A: Ultimately what we have in place is a series of checks and our cabin crew is well briefed on what to look out for. The government was also very quick to implement checks across all airlines landing in China. It did mean a longer time for passengers to arrive and check baggage, and it did put some pressure on turning the plane around, but that said, the worst is certainly over. We are now looking at the upcoming winter flu season, and we’re hoping there’s not another big outbreak there then. The other impact it had was canceling summer student group travel because of the fear of an outbreak. So we obviously had to do a few more promotions to make up for the loss of business. However, we had already worked that into our forecasts and we worked on other deals through travel agents.
Q: What are BA’s expansion plans? Have they been put on hold due to the economic downturn?
A: We have already succeeded in expanding our operations in Shanghai from five to six flights a week. Not only was there customer demand for extended services, but I think the timing is particularly good. Now people can fly from Shanghai and arrive in London on a Friday evening prior to the weekend, and we have that extra service for business people coming back. And Shanghai is one of the few cities where we’re increasing frequency at this time. Where do we see it going? We think the Shanghai Expo next year will have a positive impact in the spring with increasing business links between China and Europe. At this point, there’s no larger plan to increase frequency, but it is something we’ll continue to look at – and of course we’ll continue to work closely with our customers.