Airline Start-Ups – an Unreasonable Risk?

Two (good) articles today about the riskiness of starting up an airline and the comments they got shared with, triggered some controversial thoughts with me.

The Articles + Comments

Airline Cash BurnOAG summarized on the Evolution of airlines since 2019 (just before the Pandemic) to today. While their findings are very interesting, there is a tone in the summary and a resulting summarization by Tim (someone I generally value) that I happen to disagree with. OAG’s John Grant wrote:

“Airline start-ups are incredibly difficult, cash rapidly disappears and securing the necessary operating licences frequently takes longer than expected and that’s even before sourcing aircraft, securing slots, avoiding the competition, and building all the necessary reservations systems and back-office support functions.”

And Tim shared the full post with a comment: “OAG is a great data resource for large scale review and schedule activity. This data really doe strike a chord. Airlines are a very risky business. This is very illustrative.”

The other one was an analysis by McKinsey, checking on the aviation value chain’s recovery shared by Patrick, which he introduced with these words: “McKinsey & Company has done an interesting analysis of the aviation value chain. For each subsector, they’ve calculated the “economic profit”, meaning (return on invested capital – weighted average cost of capital) x invested capital. In other words, are firms in that sector creating or destroying value? Their conclusion: only fuel suppliers and freight forwarders created value last year, and airports and airlines lost a lot!”

The Economist’s (My) Response

Mass Market - No ProfitAs an economist by original education and having experience with Startups and Business Angels, I do happen to believe in a sound “business case”. As an airliner, I learned with American to focus on the business case. Like to reconsider twice before approving any waiver on fare rules or trying to upsell to the more expensive (i.e. more flexible) air fare. But I also learned the value of a renowned brand (AA) and service. Or to treat your colleagues as your most valuable customers – they help you sell each and every day. And can ruin a customer relation as quickly.

In “global fares training”, I learned the cost of a flight transfer, something that I never forgot; thanks Ruth King (our fares trainer), I will never forget you.

At Northwest Airlines, I learned that airlines and their managers just sold “cheap”. With full flights in summer season, the airline generated losses on the transatlantic flights. A lesson I’ve seen later over and again. Most sales staff had neither information, nor idea about the “yield” they had to generate to fly profitable. Northwest focused on a minimum yield (revenue per seat-mile) half of that of American. Then sold at that yield as the standard “special fare” and making group offers or “reseller-rebates” below that rate aplenty. As I summarized 2019 on my article about why airlines keep failing, “know your cost”.

Yes, talking about Why Do Airlines Keep Failing. It’s the same response I have on the above two mentioned articles. And many like them. At ASRA 2008, I emphasized brand faces. But I also told those brand faces – the airline sales managers – that they are not there to sell the cheapest price. Anyone can do that, the Internet lives of that. A real sales manager understands that they have to sell the high-end tickets.

Live story, also happened today. Qatar Airways passengers (mother and three kindergarden-aged kids) arrived with >18 hour delay in Düsseldorf. German Rail (clerk) sold tickets to the customer to pick up the passengers that are neither change- nor refundable. So they had to buy completely new (expensive) tickets. A good clerk of this company renowned for it’s unpunctual trains (<60%) would have mentioned the possibility of a flight delay and sold the slightly more expensive tickets that allow for a change. Or at least the optional insurance.

So thinking back to my experiences with Northwest and other such airlines, it’s my questioning about KPIs as well. If my KPI is load and not revenue, I must expect to loose money. It remains beyond me, why airlines offer connecting flight at what a rough calculation on Ryanair or easyJet CASK/CASM (cost per available seat km/mile) proves as below cost, even without the “stop en-route” (landing fees, complexity, etc.). Those are managers who had a nap, when their tutors talked about sound economical calculation? And I keep questioning, why airlines publish loads without revenue per seat. To date, we have hundreds, if not thousands of flights every day, that fly full but loose money. All this is confirmed by the above mentioned and many other such articles.

The Fairy-Tale of Loss Making Airlines

Heresy. Aviation ain't profitable - and the world is FLATTo claim “aviation” is a loss making business is true and can’t be further from the truth.

Yes, many airlines are loss making. And it fits the common reasons I elaborated before. And yes, you can make airlines very profitable, if you have a management that thinks just a bit outside the box and applies economic rules to their modus operandi (mode of operation). But this also goes in line with route development and other areas. If you don’t have your numbers under control and focus on the ones that are “good to sell to shareholders”, you’ll fail.

Like with any company, with any startup, in and outside the aviation sphere, we must constantly have an understanding of our cost. And of the competition. What is it our customer wants? There is a psychological price. If you missed that in your economics studies, make your Internet-search for it now. If you have sales teams, train them to upsell the seats. Sell the higher yield fares. Not at a discount, but at a value!

Natural Leader LemmingsThis is one reason, I do not believe we can make Kolibri ever happen by taking over an already failing or failed airline. Wrong structures, wrong thinking in place. I learned this lesson with Air Berlin. The force of inertia was simply too strong. There are some airline that make revenue, but even their managers I find often blindly “follow the worms” (a Pink Floyd referral, yes, the picture is lemmings).

(That’s) The Way Airlines Operate

But unfortunately, all investors we talk to, always think inside their boxes. Can’t tell how many talks I had to radically change our approach and take A320 and do like everyone else does. Ain’t that contrary to the concept of Unique Selling Propositions?

And has ever a “disruptive investment” (another investor buzz word) been developed out of the box using the same thinking? The same values (I’m the cheapest)?

The others are usually starting to tell you that you have to start with smaller amount of money. Sure way to burn your money is a cheap business plan. As OAG writes “getting to size is so important”. You can’t produce a low cost in small numbers. For us, the ideal mix is seven aircraft, where the “administrative overhead cost” becomes manageable. i.e. You have the same cost if you maintain one – or seven aircraft. The same reservations office (just less staff and calls), only little less marketing. You must outsource your operations (at cost) to share the necessary organization with other small airlines. Etc., etc.

Source firewalkeraussies.comTo date, I am still working with consulting companies reviewing airline business plans. Aside the usual failure issues, size is a recurring issue. Another being the lack of fallback in case of flight disruptions, may they be caused by technical issues, weather or other events. Their focus on cheap “human resources” and missing team building results in friction and internal competition that further weakens their product offering.

But even taking that into account, we believe the business and financial plans we developed are sound. And profitable from the outset. With a focus on services and a military-style responsibility “for ours” (no “HR” in that company), a “service-focused concept”. Everyone to pull on the same side of the rope. Yes, not starting with a dead corpse, trying to revive, adds some bureaucratic hurdles. But it allows you to think outside the box and instead of following the worms (or other airlines), to do things “right”.

So ever since I entered into the business, I learned at American Airlines under Bob Crandall how to do things right. And learned over and again that the same mistakes are made by short-sighted, narrow-minded managers. And I know all the reasoning used to distract and divert off the incompetence to operate an economically sound business. Usually, I account this as “no faith in your brand”. That then goes along with topics I mentioned before, like brand dissolution (airlines are often academic example), missing USPs, etc. – Cobalt CEO told me about their USP shortly before their demise “We are Cypriotic”. Seriously? When I started, Lufthansa was the brand. Lufthanseat was the employee. All employees of American Airlines knew “Proud to be AAmerican”. Then came the button counters. And mighty AAmerican was taken over by their once-small rival U.S. Airways. Another box of memories.

So yes, airlines are often a loss making business. With bureaucrats leading them into disaster. Sometimes fast, often times a veeeery long death. Air Berlin and Alitalia are very good examples. “Too big to fail”? Simply “prestigious”? And there are “the others”. Airlines that have an idea about what they are doing. That know their niche(s). That know their cost and marketing. That value their brand. That build a reputation. Until button counters (aka. bureaucrats) take over.

I hope that someone of my hundreds if not thousands of readers (hard to believe, that’s what my server stats claim I’d have) knows some investor with the guts to understand that profitable aviation and sustainable aviation can be the same thing. That the stories those consultancies and their statistics and reports tell have two sides to the coin. And that we get a chance to proof, that climate neutral flying is no heresy, but the future of flight.

Food for Thought – Jürgen

Sustainability – Ideas for Discussion

Going Beyond Greenwashing

The United Nations Sustainable Development Goals

This is not about Kolibri, but some thoughts and assessments about sustainability and greenwashing. And some ideas on why all the statistics show that the situation worsens. From Earth Overshoot Day to Energy Consumption to rising CO2 levels.

Working on Kolibri and benchmarking our cost against easyJet and others, we found our cost too high. One of the typical reasons for the airline one-day-flies, as I call them. Flying one or two seasons before they are pushed out or swallowed by the big shark. Looking for ways to cut cost, and as we thought about a sustainable operation, the extended way of the U.N. Sustainability Development Goals, we developed the business cases for truly sustainable aviation. Focused on fair income for the employees (that we refuse to call “human resources”), housing, food, transport and ground mobility, health… Yes, completely outside the box, but all contributing to the profitability.

Worshiping the Golden CalfWhile we now suffer from decades of management misconception that everything must be subordinate to (quick) financial profit and that profits justify the means, we now start to recognize that “sustainability” must be a “shareholder’s value”, as long as “long-term success” (viability). My friends and audience do know I questioned the pure financially focused “shareholder value” for the past 25 years at minimum. And as an economist by “original” profession, I question all those dreamworld models that burn money in the next big hype.

That said, aside our idea on Green SynFuel for aviation, as we though outside the box, what are other ideas I recommend investing in. Admittedly, ideas we plan to reinvest on our own journey to establish what shall become a truly carbon-neutral airline within ten years.

Circular Economy

Circular EconomyOne of the abused topics is Circular Economy, which Wikipedia defines as “a model of production and consumption, which involves reusing, repairing, […] refurbishing and recycling existing materials and products as long as possible.” While I find Wikipedia already distracting from the core of the case, the image they show is quite on the point. Whatever you use, must come from sustainable sources, and after being used must return into a state it can be reused for the same product.

Looking at plastics, 95% of the recycling in reality is downcycling! Or export. Or local landfills. Or incineration. Or – and quite a lot – ending up polluting the oceans and landscapes. But downcycling ain’t circular but add to disposal and pollution!

e-mobility Life Cycle Assessment Greenwashing Volkswagen AGIn a discussion group on Circular Economy and the Agenda 2030 organized by U.N., the focus was directed to the LifeCycle Assessment (LCA). In which i.e. Volkswagen came to rather devastating results for their ID3. The life-cycle of one of their ID3 electric “Golf” is not substantially better than the Diesel, worse if you consider the German grid-energy mix and not the more favorable (beautified) European one. It’s considered a direct consequence when United Nations Secretary General António Guterres ahead of COP26 blames: “Far too little, far too late“.

Vertical Farming

Indoor Vertical FarmingGiven the current droughts and considering circular economy, thinking about greenhouses filling entire regions in Spain, I think we will need to invest into vertical farming. Given a “closed system” to improve the water usage. Reduce use of chemical fertilizers, herbicides and pesticides. Discussing with a startup recently, I was surprised on the efforts on seed sequence. Not for the plant or the soil, but to make sure the bees they use at all times find sufficient nectar.

They are experimenting with water conservation and are able to provide a quality way better than “bio”. And it’s not just salad, but potatoes, tomatoes, cucumbers, broccoli, corn, you name it, they grow it. And they are testing apples, grapes, and other vegetables too. And they are using moving trays, from seedling at one end, to harvesting on the other.

The few remains they can’t reuse go into high quality compost for the plants that still require soil – there is no downcycling, it’s just that they use pure nutrients without soil wherever they can.

Desalination – Hydrogen – SynFuel … i.e. in the UAE

Last year, there was an article by the World Economic Forum about the UAE strategy on “extended” Hydrogen, reflecting about 1:1 on my, since 2008 frequently shared opinion that hydrogen is a natural successor to fossils in the expanded tropical belt. I strongly recommend reading!

Hydrogen powered Wing in GroundGiven our work in 2008 on the hydrogen-powered WIG, a “wing-in-ground”, an “airplane” that uses the “ground-effect” for smaller wing-size and improved performance, we were told the idea would be perfect for the tropical belt. As those WIGs “fly” in five to ten meters above ground, water is perfect for them. But even more important, the use of seawater allows to develop a salination. The sweetwater can to a large extend be used for the population. Naturally, before desalination the seawater is being cleaned. Then the salt from the desalination process is used to increase the salination levels of more seawater. That salinated seawater is then used for the electrolysis.

Operating in the “extended tropical belt” and seaside, the availability of wind and water for the “green” process is very safe.

World Climate Zones

Sure, this was a very steep learning curve. It triggered my understanding that carbon-neutral transport is not just imaginable. It’s feasible. And many of those ideas, applied to our ideas for Kolibri made and make it possible for me to develop a plan that makes it possible to use a body like Kolibri to make it fly carbon-neutral within 10 years (even less, given the right support). Saving a mere 2 Gigatons of CO2. Not by then, but by then every year!

The Four Columns for Happy Living

United Nations defined the four columns as the foundation for people to be happy as:

  1. Shelter
  2. Food
  3. Health and
  4. Safety

That naturally includes the families, something often ignored. Or is identified as “salaries”, hiding behind “politics” resulting often in the inability to secure the above columns. And did you know that those are a growing problem even in the so mighty “industrial world”?

Learning From the Military

Noone is left behind
Noone is left behind

Ndrec and I are both having a military background. While Ndrec was a career officer in the Albanian military, I grew up in a U.S. garrison town in Germany with their families.
In the military, while you are there, everything is taken care of. Aside a salary the soldiers can use for surplus luxuries.

Quite similar, in the last centuries, many companies developed housing and even just 35 years ago, I’ve stayed in an American Airlines-owned residence.  All larger airports have own cantinas for the airport employees and “external” airport workers.

Precarious Working Conditions

Most companies pay a “competitive salary”, but increasingly, those competitive salaries do no longer cover the most basic needs of people. That is especially true for families with children. “In 2020, there were 96.5 million people in the EU at risk of poverty or social exclusion, representing 21.9% of the population.” [Source] But while EU highlights progress on SDG1 (no poverty), even for industrial leader Germany reports show a growing poverty with wealth increasingly piling up with the rich 10%, owning currently 56.1% of it, the top 1 % holding about 18% of all wealth, as much as 75% of the population owns. More than 60% “own” less than 5% of the wealth, while 20% are being in debt! And those numbers are growing.

Those numbers are looking even bleaker on a European level!

#Greenwashing and #Raisinpicking

Greenwashing Demon (shutterstock_1170455851)

While the SDG funding gap grows at an alarming speed, poverty rises at alarming levels in Europe, there is an entire industry of greenwashing impact investors out there, using raisin-picking creatively to greenwash their investments. But there are 17 SDGS. And the possibility to do aa life-cycle assessment.

And as referred to before, two simple question disqualifies many, if not most of those “impact investments”: What is the energy bill and where does the energy come from? Is carbon-certificate-trading used to paint the idea green? Investments needing carbon certificates to go green are unsustainable themselves, selling their indulgences by buying what good others do. If you buy into grid energy, use grid-energy shares. Only if you have your own plans for energy source (solar and wind parks, etc.) you can calculate.

Primary Energy Demand vs. CO2

Our growing energy demand causes directly rising CO2-levels. The graph is already a bit older, but the statistics are showing that the short improvements during the global pandemic have already recovered and the rising energy demand in Europe is in line with the CO2-rise.

And do you claim climate action but pay no attention to your staff (and their families) happiness in form of sustainable salaries? Delivery services claim their “riders” deliver “green” using bicycles. Whereas it is commonly known that those very riders usually work in precarious working conditions! Same for Uber and other “investors’ darlings”.

Earth Overshoot Day 1971-2022Earth Overshoot Day

Did you know the Earth Overshoot Day after a very brief respite 2020 fell back again in 2021 and 2022? So what are your plans on using resources?

And did you know that “sand” is a resource in short supply? As is clean drinking water!

There is a frightening map on OvershootDay.org on the countries that use more resources than they have and there individual overshoot days. The U.S. overshot by March 13 already! Germany May 4th. All European countries overshoot in the first half year, so they use more than two Earths resources.

Timeline + Scale

EU climate plansThere are many investments into small-scale change, with a focus on two to three years. That by itself should be an issue of concern for any real impact investor. As for climate change and sustainability that can only be a start. What is the 10 year outlook? What impact will it make by 2050?

What is the impact on which SDGs? The United Nations Sustainable Development Goals! Precarious jobs are clearly a negative impact on the SDG1 and ripple also into the other SDGs. A negative energy balance naturally impacts climate. SDG7 and SDG13 are related, as are all the other SDGs!

Sustainability is a generation challenge! To turn around our abuse of global resources back to a sustainable level. Conserve energy. All that with as little impact as possible to the luxuries of the decision makers? Having grown up in the 70s, that was the time this all started. And my boss on the practical part of my economics studies questioned “price wars”. While there can always be someone cheaper, a good buyer considers the well-being of their supplier. And buying cheap from China comes with a price. His lessons resonate more than ever nowadays!

A Holistic Approach to the SDGS

Employee TrainingOne of the main concerns we are faced with at Kolibri is our approach to sustainability. First of all, why would an airline turn sustainable, it’s heresy, ain’t it? And why would we pay salaries above country average? Maybe, because they are sustainable and secure the people’s motivation and loyalty?

What about our plans for training, kitchens, real estate, residence parks, solar parks, transport? Can’t you shelve those (in the trash)? But we believe that if we right those wrongs, we will have a motivated and loyal work force. And ain’t that funny? All those “investments” are to be profitable too. As that is what we consider real impact investing. Do the right thing. With the right profit. As such, they are part of our 10 year strategy.

Kolibri 10-year outlook

So after 10 years, we don’t only save more than two gigatons CO2, per year that is by then, we will not just be a sustainability lighthouse, we will be not just profitable, but also disruptive. But only, if we get to #walkthetalk. Which means that we do find a real impact investor.

Food for Thought
Comments welcome!

Kolibri LinkedIn Posts and Images

Having recently worked out new promotion images to attract investors for Kolibri and shared them on LinkedIn, the halftime for the attention about LinkedIn articles sure is very short. So Mike asked me why I wouldn’t put them in the blog. So here you go. I think you see the development from 14 to 16 October?

14 October: On Kolibri Profitability

Got asked about Kolibri profitability. We intend to start with min. 4 and up to 21 aircraft (higher initial investment = less overhead cost per aircraft, more routes = lower risk). More than 200 a/c year 10.

Roughly serving more than 65 million passengers a year, sustainably employing more than 20,000 people, creating more than 60,000 other jobs in Europe. A #highlyprofitable #billioneurobusiness if you avoid the common mistakes.

THAT is #industrialscale … and needed for a #holisticapproach to the #sustainabledevelopmentgoals (#noraisinpicking) and make #climateneutralflying a profitable reality!

Or as Aradhana Khowala says: Whatever you think. Think BIGGER!

And as I keep saying. If you want to be a #profitableairline manager, #thinkoutsidethebox. Way outside the box. The same if you want to launch a profitable lighthouse airline to fly climate-neutral within a decade.

If you know of #investors seeking to #kickstartfund the next highly profitable, sustainable #industrydisruptor and a #climategigacorn – we’re happy to help! #impactinvesting #impactinvestor #familyoffices #venturecapital #privateequity

15. October: Heresy!

Sit back and sulk. Or help us funding the set up Kolibri, a profitable, large airline to connect Europe climate-neutral within the decade!

Heresy. Aviation ain't profitable - and the world is FLAT

16. October: Kickstart

And all we need is a serious kickstart investment …
#walkthetalk #beyondlipservices #gigacorn #pleaseshare #climateneutralaviaiton #climateactionnow #impactinvestors #familyoffices #venturecapital #privateequity #unsdgs #agenda2030 #returnoninvestment #minimizedrisk #maximizedcrisisresilience #usps #disruptor #industrydisruptor #doingtherightthing

Kolibri 10-year outlook

 

Is it all Greenwashing and Talk-the-Talk?

Go Carbon-Neutral This Decade

Looking at the past two years struggling to find investors for Kolibri, to change aviation and develop the proof-of-concept for carbon-neutral aviation, meeting with impact investors, family office principals, venture capitalists and others, European, Arabic, North American and even Asia resulted in quite some disillusioning.

Two lessons learned.

Lesson 1: It’s All About Energy

Primary Energy Demand vs. CO2If. If we really want to stop global warming, it boils down to reduce our energy demand. On a global level. But the reality is quite opposite.

While the current clash with Russia should be another wake-up call, it just proves that and how far we are from saving energy. From removing our energy footprint. Instead our leaders travel the world buying fracking-gas, crude oil and “natural” gas (from crude) to feed the ongoing hunger. We can’t expand “sustainable energy” fast enough, to reduce, less to replace all the oil, coal and gas we consume for our energy hunger. And building windparks, water-power-plants, solar parks also comes with a toll. One we have no idea yet on how to avoid the negative repercussions to our world. Which I i.e. addressed last year in my question about Wind Parks and the Butterfly Effect and the fixed page on The Sustainability-Energy Dilemma

The United Nations Sustainable Development Goals

If we use more energy to solve any of the famous United Nations Sustainable Development Goals, it’ll be a barrel burst! If we go for electric cars, is that more than putting a band aid on a purulent wound? Are the developments about electric flight or hydrogen aircraft anything more than delaying tactics by our industry to justify their lousy 2%-blending goal? Look at my whitepaper about #greenwashing if you want to find more examples.

emobility-hydrogen-greenwashing

Lesson 2: The Reality Behind Impact Investing

Now my litmus test to distinguish real sustainable investing from #greenwashing is simple: What is the Net Energy Impact? And yes. I’m kind’a sorry… But that includes many, if not most of those fancy “green tech solutions”. They are nothing but another distraction keeping us from the real challenge. And an excuse from governments and investors alike to avoid the real, industrial scale change we truly need!

ESGGreenwashing: Putting Lipsticks on Pigs

Also known as #talkthetalk …

Call for Action

Kolibri UNSDGPart I: To investors: We are slowly running out of money on our plans for Kolibri. We have succeeded due diligences. We have a holistic approach covering the U.N. SDGs. And we plan to reach break-even within one, be profitable in three years. And to benefit from the “new normal” enforced by Corona and the Invasion of the Ukraine. But to do this we need a sizeable launch-funding and our ideas to establish the technology to fly Carbon-neutral is even more expensive. It ain’t cheap to turn an airline carbon-neutral, but it is possible! So there are three steps. Step 1: Launch a profitable new regional airline with competitive cost-levels to stand out in the shark-pond. Step 2. Expand to lower the cost and generate the revenue to fund Step 3: Establish the infrastructure to turn carbon-neutral … and our ideas for a truly sustainable airline – beyond climate.

If it’s not you, we need commitment to help us secure the funding. Less #talkthetalk

Part II: To All: And for you personally? We as a family reduced our energy consumption by 10% last year. Despite all that modern household-tech, home-office and other energy consumers. What’s your saving?

Man in the Mirror [Michael Jackson]

Food for Thought
Help welcome!

The e-Mobility Lie

This weekend German ZDF’s planetⓔ released a documentary about the electric car myth subtitled revolution or barrel burst. In addition, there was an emphatic discussion about hydrogen and mobility on LinkedIn, with very noisy advocates for e-Mobility. So I just wanted to summarize from the documentary some findings that are quite in line with my understanding of the Sustainability-Energy Dilemma and the Road to Climate-Friendly Transportation (beyond flying). And why I consider e-Mobility a lie.

Don’t get me wrong. We need e-Mobility. No better solution for a household with  solar panels on the roof, a battery buffer and a range-demand that allows them to rely on the car. But.

Issue 1: The Batteries

Batterie Raw Materials

National Geographic - Lithium MiningAs you may remember, I keep referring to this article by National Geographic on the devastating cost of Lithium Mining. Lithium being to date the most important component for batteries. And the replacements ain’t any better! In addition, they need some rare minerals, the prices of which are exploding. Guess the “impact” if we replace not just some 100 thousands but millions of cars by electric. We talk about 56 million cars having been produced in 2019 world-wide.

Experts already worriedly question the viability of battery-powered cars and the overly optimistic believe that the battery prices will continue to fall. China is reported to secure world-wide Lithium deposits, European car makers demanding governments to do the same! It just got to public attention recently on the U.S.’s retreat from Afghanistan (source-sample).

Safety

Tesla on FireAnother issue that slowly reaches the public is the issue of batteries catching fire. First major reports were on the Samsung Galaxy 7 catching fire, forcing i.e. an entire airplane evacuation. But searching the Internet, you find also more recent reports aplenty. Also the Boeing 787 experienced a problem with it’s battery catching fire (fortunately on the ground). Attributed by experts to the attempts to miniaturize and push up the battery capacity beyond their “safe margins”. The scientific term used to distract the public attention is Thermal Runaway

Electric Car Fire - CoolingWorse, recently despite their relative low numbers, electric cars are increasingly reported to catch fire. Some at first loading at a standard, approved home loading facility, others while driving. Different from gasoline, a thermal runaway and the resulting battery explosions cause a much higher real danger to the cars passengers. And it does not help to distinguish the fire, but such car must be placed into a water tank for several days to cool down the batteries. And after a fire, such cars usually are beyond any recycling. The picture just one example of the many that can be found on the Internet.

Recycling

eMobility Battery RecyclingIncorrect disposal of Li-ion batteries can have a devastating environmental impact on the environment, sparking the need for recycling (Source). But as the ZDF-report also questions, there is virtually no recycling yet and the recycling comes with a bunch of issues. Like non-standardized components and liability issues, that currently result in a very limited recycling. As mentioned in safety, those liability issues are expected to be quite an issue for anyone attempting recycling. And the missing standards resulting even in different battery packs within the model family of the car makers. Making it even harder to recycle them!

Issue 2: The Energy Consumption

Loading Infrastructure

Full eMobility Loading Stations
Oops. Sorry, all loading stations in use

Again, now today we have the loading stations for electric cars and they are not enough. With the family in “Car City” Braunschweig (Volkswagen), at our owned apartment, there neither are possibilities to load the cars, nor even nearby. Publicly accessible loading stations are usually for 1-2 cars. But what if all cars are electric. You simply got to be kidding, right?

I have personal reports from friends frustrated about their electric car about unavailable loading stations and long waiting times, but there are also many on the web, like this one. Now let’s imagine a parking house that must be equipped with electric vehicle charging stations for all cars? Then imagine, one of those cars catches fire from a thermal runaway…

And here we talk about an industry country like Germany. Now think about less privileged countries…?

Range and Refuel

The three biggest fears of our generationGerman Automotive Club ADAC just recently reported the average range of electric cars being about 350 km (220 miles), up from 250 km (150 miles) five years ago. Thinking about my role as an airline sales manager some years ago, for a road trip, I traveled frequently more than 500 km a day. Then I shall load the car after a half day, sitting around while waiting? Keep in mind, that corporate fleets and rental cars are the main buyers of new cars! And they don’t buy them because they park them most of the time…?

As mentioned before, then we talk about the loading infrastructure i.e. on highway truck stops. Just been stopping at one on one of the busiest German highways. With 8 lanes and 16 loading columns for fossil fuel, and two for electric cars. With two more already waiting in line.

It goes very much in line with the 3 biggest fears of our generation and the Sustainability-Energy Dilemma… Just in case you’re wondering why people still buy (and rent) mostly gasoline-powered cars.

Power Consumption

Power from the Plug GreenwashingThe new Volkswagen ID.4 uses 22.8 kWh per 100 km (Source ADAC). Considering a “typical” average range for a car of 10-15,000 km, we talk about 300 MWh/a. Given 48.2 million cars registered in Germany (German source), we would need about 15 Petawatthours (15,000 TWh/a) one year alone. Any green energy source for that? Germany used 545 TWh/a in 2020… In 2020, about 252 TWh/a were produced from “alternative sources” (aka. green). That would be enough for the power requirement for about 850,000  electric cars…? Reminder, there are 48 million cars roaming German streets.

And sure, all that power comes from the Jack. And sure, it’s all green? Just like German Rail.

The CO2-Saving Lie

Volkswagen ID.3 Life Cycle AssesmentLooking at Volkswagen’s own Life-Cycle Assessment, planetⓔ just compared the CO2 on a single car. And how they used a European basis to lower their CO2 impact, instead of using the German statistics, where the impact is worse than on a normal Diesel. So planetⓔ also understand that in order to reduce CO2 is an energy-challenge, we must reduce the energy consumption, all else is blissful ignorance, cognitive dissonance or simply an outright lie!

The e-Mobility Lie

Change Resistance (shutterstock_210479080 licensed)Like I found on the research for the Sustainability-Energy Dilemma, we must look at the complete picture. Taking a look at some 50 million cars, which is excluding trucks, at 30 tons CO2 on a 15 year life cycle we talk about 2 tons a year per car. Or 100 million tons of CO2 just in Germany. Make your own maths on Europe or the World.

So to make electric cars “sustainable”, green energy is needed. Which takes us back to the Sustainability-Energy Dilemma. And it confirms my opinion that while we must turn aviation climate friendly and start n.o.w.! There are a lot of other areas that all boil back to the Sustainability-Energy Dilemma. Good ideas mentioned by planetⓔ at the end of the report were needs to rethink transportation. The need to reduce the number of cars. Car sharing, better public mass transport systems, etc., etc. And to develop integrated transportation that works for both, the major cities everyone uses as the role model, but also the rural regions.

The Necessity for a Holistic View

outside-inAs I mentioned in my post about Flygskam, we have a very … strange? … view on aviation. As on sustainability. And I hope that journalists like planetⓔ, real impact investors and family office principals interested in real impact start more questioning those views. Stop “airline bashing” as addressed in Flygskam, stop worshipping the golden calf of e-Mobility and understand that we don’t have the luxury to do this or that, but that we need this and that!

Ready Player OneReady Player One? I love SciFi. There’s a lot really good ideas how we could merge individual transportation needs with “public” transportation. But that’s SciFi. We need to take the best ideas and evolve our transportation to sustainable ways in the real world. We must reduce energy. Integrate transport modes. Why does it remind me of the question why the big train stations are not at the airports? The “new” Berlin Airport being a perfectly bad example on this!

Greenwashing Demon (shutterstock_1170455851)
The Greeenwashing-Demon – it’s all about Electricity

But if we don’t solve the Sustainability-Energy Dilemma, if we don’t focus on ways to reduce energy, it’s all lip-services and greenwashing! And if you know investors who are interested to address this on an industrial scale and make real impact while making profit, I have a lot of ideas. Including profitable plans for myself and my industry, turning aviation environmentally friendly. But that’s only my part of the big picture. Though it covers already many complementary ideas we want to realize in other areas.

Food for Thought!
Comments welcome…

So What Is YOUR Impact?

Discussing about the individual impact we make, the topic gains interest. What is your own, personal net-impact to our planet? So I decided to summarize some of the posts and comments I had on the topic on LinkedIn.

In line with previous posts about #lipservices, #cognitivedissonance and #wishfulthinking. And a #realitycheck for others, claiming “sustainability” that they do not deliver upon.

Self-Esteem over Sustainability

Bezos Musk Gates (c) CNBCA clear article on it was today’s post by SEDO-founder Tim Schumacher Search: “People should only be classed as billionaires when they remove a billion tons of CO2 from the atmosphere.” referring to the CNBC article questioning the sustainability investments of Jeff Bezos (Amazon), Elon Musk (Tesla, SpaceX) and Bill Gates (Microsoft founder).

In my comment, I emphasized that we need no ESG, but #sustainabilityaccounting. And much of what I see from these and other investors is showing their response to their conscience, focusing their activities on things they understand, but also things that have an impact to their self-esteem. And there was also this Open Letter to Bill Gates, reflecting on his #cognitivedissonance or #lipservices. I believe it’s simply cognitive dissonance. Keep in mind, these people also live in their social (media) bubble.

Role Models

Image Daily MailYesterday, there was a report about industry leader/face James Hogan, former CEO of Etihad, caught in the act, trying to circumvent the Corona rules in place. It underlined my post two weeks ago, that we have airlines skipping pre-flight corona-testing regime. A disservice to an industry trying very hard to make flying safe! I’m sure he regrets that idea now, not having considered the repercussions of being caught.

#cognitivedissonance: While flying itself may be safe, passengers aren’t! Anyone claiming flying to be “safe” shall better keep in mind that the virus spreads and new variants keep spreading by travelers. Also and a lot pre-tested passengers are infected but not yet positive, they then spread the virus in their destination.

#weareallinthistogether and the only safety I see in the vaccinations. And this ain’t the new measles I compared to early in the pandemic (May ’20), but more like the flu. A vaccination not available to everyone (yet). About which U.N. Secretary General António Guterres warns of #vaccinationalism. Also claiming the climate emergency. A caller in the dark?

The European Sustainability Bank

Then, let me talk about the decision makers at European Investment Bank (EIB). Claiming to be the European Sustainability Bank. In a conference by Geneva Macro Labs, I asked their head of climate office Elina Kamenitzer on her claim that they do green investments: Are there any success stories that proof the impact, the “impact” targets achieved ever since? Well, no. They “have to look into that now.” It’s about time.

Others are faster, but we have a PLANI also reached out to my now ex-point of contact in EIB, about a co-investment into our impact plans. With (a cheap) reference to their Roadmap and the decision there to not finance conventionally fueled aircraft (page 102), he disqualified any investments into aviation. In utter ignorance of what I believe he understood (I did remind him), that we have plans that are not aircraft-funding related. But i.e. development into a synfuel-ecosphere. Our plans cover all of the 17 SDGs, mostly with quantifiable targets that we sure plan to exceed on. If you’re convinced to do the right thing, that comes as a natural.

But that ain’t what the bureaucrats at EIB look at, is it?

So back to the article topic:

What is Your Impact?

Impact InvestingThere is a petition against greenwashing on Change.org I urge you to sign! Discussing on that one, we had several discussions on how to define greenwashing. Whereas family office principals told me ESG would be the role model for greenwashing. A good idea, meanwhile abused. There may be some investors who understand the meaning of it. But not many.

It is the same about claims to be “sustainable”. Another family office principal told me, that out of the 2020 impact investments, only 4% were having clear impact to improve on SDGs. 96% were disqualified as they just claimed without goals and targets but simple claims misreading the causes. Nice if you plan SDG5 Gender Equality on your hiring process, but without clear targets on how to improve. Or if you abuse SDG9 Industry, Innovation and Infrastructure for your “innovative IT project”.

Only Net Impact is Real Impact

We came to the conclusion that real impact is about net impact. And that “impact” is about reduction of the strain we put on the planet. To reduce power consumption by 10% but planning to increase the total power needs by 30% is intentional abuse of the sustainability claim.

There are many good examples out there, beyond what we plan at Kolibri. But we speak a lot with investors that want to cash-in on us before we launched. And investors, investing little money into small projects, more like a philanthropy, but an impact investment. Paying for a clean conscience, paying for their other daily sins. I just told one of the family office principals. We are looking not for those classic investors. We are targeting the family office space, as there are more investors than elsewhere wo take sustainability to heart. Who focus on it. Who are understanding that an impact investment might not be as profitable as i.e. Bitcoin. But it’s the right thing to do. And

Impact Investment ain’t philanthropy. Do good and make money!

So this time, not just Food for Thought, but a clear question:

What is Your Impact?

Feedback welcome…

And the #Greenwashing Continues

While we have sound plans to establish a profitable airline, planning to operate carbon-neutral, #greenwashing and lip-services dominate responses we get from “impact” investors, why our model cannot be supported. And the same what is heard and seen from politicians and public funds.

Now the last weeks, the “green strategy” is a big issue in the media. European Investment Bank claiming to be be the “Sustainability Bank”. The Mission Hydrogen 24 hour workshop. The reality check on to German Rail’s sustainability. Or the facts about the “global recycling champion” Germany. So let me summarize these reports. And call for any serious investors interested to make a true impact, to talk to us and learn the big impact we want to make. While establishing a profitable, future-focused airline.

German Rail & 100% Sustainable Power?

The Myth about Green German RailDon’t get me wrong, this ain’t new. There have been reports about this ever since they started their fake promotion about 100% sustainable power. But just this week, German Television did a reality check, with rather devastating results!

Just 61% of German Rail’s power comes from renewable energy. 28% come from coal and natural gas, where German Rail partly owns the latest built coal power plant, built against all public opposition. German Rail has long-year delivery contracts for atomic power. And only 33 out of 5,679 railway stations are powered from renewable energies, 0.5 % … And by 2038 (17 years from now) German Rail wants to increase the use of sustainable power to only 80%, targeting 100% only for 2050.

That excludes non-rail business, like Schenker logistics, clearly focusing on Dieseltrucks. Where container transport by rail is more than six times more ecofriendly than trucks. But having demolished most of the industrial accesses, parallel tracks and being delayed on major infrastructure projects like the European North-South rail axis, now backfires and cannot be remedied quickly.

ECB & EIB – the Sustainability Banks?

While we talk with impact investors, we do also understand the European Central and the European Investment Bank claiming to be “Sustainability Banks”. Talking with the very same investors being “naturally” and clearly interested in sustainable projects, we asked why they would not make use of those funds to complement an investment into Kolibri or other impact investments.

The feedback I get is painfully clear. They do not work with the EIB (or other government fund programs) for the bureaucratic process required to be “approved” as an investor. I have multiple statements that attempts to support the investment failed. Assumption being voiced that those funds again go to the big players and into unqualified “green projects” that are mostly about #greenwashing. That includes a claim that EIB funds new aircraft for the dinosaurs – without any requirement(s) for those aircraft or the airline to develop a strategy to reduce their carbon footprint.

I also reached out to one of the experts in my network, working closely with those banks and doing studies on their sustainability, asking why venture capital or family offices don’t work closer with such government funds: “But what you report from your interactions with public investors is true even for smaller and less ambitious projects and companies in that public VC funds invest only if the concept is validated by the market in one way or the other. In other words, only if someone else confirmed the commercial success elsewhere.

Germany – the Global Recycling Champion?

Reality is, that Germany is the global champion in export of plastic trash. Instead of a strict recycling regime, 80% of the trash collected from the recycling bins is being either exported or burned.

The drop in export results directly from China having stopped and banned the import of plastic trash. So now, the pictures of plastic from African countries dominate the respective stories about German “recycling”.

At the same time, the plastics industry is booming. And instead of developing sustainable packaging, the trend is clearly towards mixed-use, the known bad example being “Tetra Pak®“; a packaging made of several layers that make it exceptionally difficult to recycle. And the few recycling factories being more for greenwashing than for recycling any meaningful amounts of that stuff.

There was also a report on TV this week on Coca Cola and how they changed from the recycling glass bottles to throw-away plastic bottles and Aluminum cans. Which was the beginning of the end of bottle recycling. And how their lobbyists ever since fight any recycling requirements…

Aviation – the Scapegoat?

ContrailNow, how about “my industry”, how about aviation? And why is it constantly the scapegoat and blamed for global warming?

When the aviation industry claims that it’s only responsible for 2% of the CO2-emissions, this is also green-washing. As aircraft engines exhaust contains also other “greenhouse emissions” and many if not most not on ground level, but at high altitude. The “contrails” being a visual reflection that people “know” and can identify. Experts in a report about Airbus this week accounted the greenhouse emissions by aviation to 6%. Not much, but only 4% of the world population flies. And 6% is substantial.

So aside our plans to use Kolibri.aero to establish the infrastructure and certify the use of 100% synkerosene to fly carbon-neutral, we also understand the issue of the aircraft-engine exhaust will require further research into greenhouse-effects of the remaining exhaust. But which only can start, once we start flying “carbon-neutral”! And yesterday, I was challenged twice about synfuel and that we’d need to look at use of battery, hydrogen and fuel cells. Referring to a very academic presentation by Prof. Dr.-Ing. Josef Kallo of the German Aerospace Agency (DLR) about How to fly with Hydrogen, addressing fuel cells at the European Hydrogen Workshop by Mission Hydrogen GmbH (Ltd.).

See my recent blog about The Road to Environmentally Friendly Flying

Electric, Fuel Cells and other Aviation #greenwashing

Cheop's Principle: Nothing is ever finished on time and/or on budgetSpeaking with one of those “challengers”, he argued that in 10 years the first regional aircraft will fly on fuel-cells. Being “project planning”, I’d say better add 50% reserve to that, then we talk about 15 years. And personally I still doubt that time line. And then we will have aircraft with 10, 20 or maybe 30 seats. With a range of one to two hours. When we will have aircraft that transports 100 seat? Or ones that can replace the 150-250 seats used by the low cost airlines? When do we expect aircraft to transport 250-350 passengers long haul? Hiding behind “Research”? Science Fiction…

The argument given was that batteries and fuel cells will become more effective. Which I file under “cognitive dissonance“. What excess in miniaturization results in, we all experienced with the B787 batteries self-enflaming. Or the Samsung Galaxy Note 7 “fiasco”. Trying to mend the rules of physics is a true challenge. And that does not even cover the devastating ecological footprint not only of Lithium. If you want to wait for that to be resolved, we talk about “dirty” kerosene still in use in 20, 30 years!

And if that happens, our industry is worth being used as a scapegoat…

Change Happens – NOW!

Salzgitter AG ElektrolyzerSustainable economy and global warming are big issues today, but most that we see is lip services. An investor group just recently checked impact investments for the “real” impact. They reported about 4% of all investments having a quantifiable impact or quantifiable targets. Only 4%. All others to be #greenwashing. On the “impact programs” of the 100 largest companies in Europe they found not a single one having more than one or two percent impact to global warming. Most of them being “lighthouse projects” that are being developed inside a “bubble” that does not immediately impact the company. Mostly lip-services addressing already established programs, but don’t really change the existing processes.

One example mentioned being the Electrolyzer delivered to Salzgitter AG for delivering hydrogen to be used in their steel-making process. A “research project”, largely funded by the hydrogen program. And now, being still in research phase, trialing it’s impact, it’s a “lighthouse project”?

The Fight against #Greenwashing + Lip-Services

We choose to fly Carbon-Neutral in this decade
We choose to fly Carbon-Neutral in this decade

And today I was confronted again with “avoid flying” as the first and foremost advise to stop global warming. While people will fly, economy needs flight connections as well. What we need is to stop blaming aviation, but start changing it. And the governments and public funds won’t help, so we need bold investors with a mission to help establishing the environment that allows us to work together on the common goal. Clean flying. Flying without remorse. Flying with a conscious mind.

We choose to fly Carbon-Neutral in this decade. And do the other things. Not because they are fashionable and easy, but because they must be done. But we can’t do it alone, we need investors that are interested in more than greenwashing their conscience, but the ones supporting the real thing. Investors that understand this is a big deal, it’s disruptive, it’s a journey. A journey that needs conviction, founders with the commitment and vision to make it happen…

Food for Thought
Investors welcome!

 

The Road to Environmentally Friendly Flying

Electric? Hydrogen? All the aviation associations promote going “green” 2040. Or beyond. Whereas the technology for the first step is here.

Being asked on my baby KOLIBRI.aero on why we don’t wait for electric planes or hydrogen planes, my answer is simple. They are fog-screens, intentional distractions allowing the airline to hold on to them to avoid really addressing the issue! To avoid Change. This can be brought down to very easy to understand examples.

The Fairy Tale of Electric Passenger Flights

Zunum 50 seat electric plane
Zunum Electric Plane

Boeing dropped out of funding Zunum, having the plans to develop an electric air plane. Because there is a simple, physical challenge that they cannot overcome. The battery size. Reducing the battery size, Boeing learned the lesson with the 787 Dreamliner. Where internal batteries caught fire. Would that have happened inflight, you can imagine the catastrophic impact. They had reduced the size vs. capacity to the point where batteries happen overheat. Especially rechargeable ones that we talk about it here. It is rumored and I heard it from Boeing, that their engineers disqualified electric passenger planes beyond 35, maximum 50 seats. The max size Zunum targeted, but with a range of one flight hour, maximum 90 minutes.

There may be developments that may one day increase battery capacity while reducing the size, but they are wishful thinking as of today.

The Fairy Tale of Hydrogen Powered Passenger Flights

Airbus Zero EmissionThe very same issue is it about hydrogen powered passenger flights, Airbus recently promoted as their “Zero-Emission Aircraft”. Again, the physical challenge.

To put into those aircraft cooled hydrogen tanks with the related cooling makes those tanks very bulky. In fact, sources inside Airbus have been cited assuming 50% or more of the fuselage (cabin and freight compartment) to be needed to build in the hydrogen needed to operate the aircraft 60 to maximum of 90 minutes. Unpressured (uncooled) Hydrogen does not have the needed energy.

That is, why those airplanes Airbus showed in the picture are also small aircraft, with about 50% less seating of a comparable aircraft those sizes today. Another wishful thinking and fog screen if you ask me.

Electric + Hydrogen Electric – a Summary

There is a very interesting summary on electric (and hydrogen-electric) flight in a 45-minute YouTube video:

Generally it confirms my opinion, that we won’t have any substantial development in time for any meaningful impact on the climate goals. With first liquid-hydrogen prototypes expected by the research experts by 2035 to 2040 and first commercial operations likely 10 years faster. See my summary from an expert panel in the comments. A bit late for a 2050 impact?

And electric will start with small air taxi-type services of 15-20 passengers. And while that is a good development, it will only replace (and enable) very small regional routes. Can you imagine 5-10 slots an hour at any of the larger airports to be burned by such small planes?

It will very likely take beyond 2050 until we will see any of the 100 or 200 seat aircraft flying commercially on either technology. Bullocks. Just more #greenwashing …?!

[Added 28.Jul.2021]

The Road to Carbon Neutral

Biofuels greenwashing

Rape seed monocultureDeveloping Kolibri, from the outset we thought about using contemporary aircraft allowing us to use bio-fuel. Though bio-kerosene must be “blended”. Must be mixed at least one to one with the classic, dirty kerosene. Often, it is mixed like “E10” gasoline, only 10% “bio”. It’s not uncommon to have a 10-20% blend only, using 80-90% classic Jet-A1. Whereas the “bio” comes mostly from rape seed monocultures (picture), having already it’s own negative impact on bioversity. That ain’t “clean”, nor “sustainable”.

Hydrogen – a volatile gas

Hydrogen powered Wing in GroundFrom my work on a solar powered WIG 2008, replacing it’s diesel-engine with an hydrogen-engine, I understood hydrogen as the future. Clean electrolysis using solar power (and wind, bio mass and other sustainable energy sources) and salted water, whereas desalination facilities produce the surplus salt to augment seawater to the level needed for the electrolysis. So sunny regions with access to seawater have a “natural advantage” to develop the infrastructure to create hydrogen.

Now hydrogen is exceptionally volatile, even in special tanks, the losses are substantial, so it’s not easy to transport. Now…

Synfuel

Synkerosene, Powerkerosen, eKerosene, synfuel, powerfuel efuelTwo years ago Sunfire’s Synfuel triggered my attention, from a National Geographic report – not reported in Germany, but in the U.S. … I instantly understood synfuel a perfect solution to replace our plans to invest in expensive electric and hydrogen powered ground fleet, still with the need to have Diesel-powered trucks and emergency generators in an airline, with syndiesel. And to develop into synkerosene to replace biokerosene.

Developed since, Sunfire with partners started a construction of a synkerosene facility in Oslo, Norway. No, not in their home-country Germany, but in Norway. Norway is not full member of the EU, “only” an associated country. Make your guess, why not inside the EU… Maybe Ursula von der Leyen’s implied quote below gives you a hint.

World Climate ZonesAside, synfuel can be used quite easily as a buffer technology, using excess power to create synfuel during peak times and using it in common and tried power generators to recreate energy in low times. Until we have something better, Syngas is a clean energy source that can make us independent of crude-oil for power generation. a technology that can create a future for many “poor countries” in the “tropical belt”, the tropic (red) and subtropical zones (yellow), as their surplus of solar energy is way higher than what the northern hemisphere has in the temperate to polar zones.

The Fairy Tale of the End of the Combustion Engine

Others are faster, but we have a PLAN

Guess what, there is a Workshop “Mission Hydrogen” this week in the EU with some focus on Germany. At the same time, Saudi Arabia announced to invest 700 billion to become the global leader in hydrogen … While European players still make plans, others stake their claims. And to transport that hydrogen, syngas offers the advantage to be using the same logistics infrastructure.

And while German transport minister Andreas Scheuer demands the end of the combustion engine by 2035, I can only interpret this as another short-sighted publicity stunt. A distraction and a fog screen! By a minister who’s not known for his realism. Combustion technology will still be around a while, cars having a lifetime of minimum 10 years. Other technologies like aviation, simply lack an alternative for now. And while privileged nations can likely afford the switch, less privileged regions will rely on combustion engines for a great number of reasons and even more years.

Making the Change

Kolibri - disrupt aviationSo while we make again big plans in Northwestern Europe, developing synfuel facilities in the “poor South” makes a lot of sense. Developing synfuel facilities at airports will be an incubator for the regional conversion from classic gasoline to synfuel. Developing a new “regional” airline with the large demand of synfuel, will make the development a profitable venture. A classic win-win.

So anyone believing in electric passenger planes is daydreaming, or whitewashing why they don’t invest to become clean. A distraction, a fog screen. The same is true for purely hydrogen-powered planes.

But anyone who wants to make a change, can do so today. Modern aircraft engines are ready to apply 100% synfuel. Or so Sunfire, Norsk-e-Fuel and an engine maker assure me. Synfuel created from hydrogen and carbon-dioxide. Not carbon-positive, but yes, carbon-neutral. Proven tech. Today.

And we have a business plan, and we have the interest to make this happen. Starting today and being carbon-neutral within this decade. If not faster.

Food for Thought
Investors welcome!

Go Carbon-Neutral This Decade


Go Carbon-Neutral This Decade

“We choose to go to the Moon in this decade and do the other things, not because they are easy, but because they are hard; because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one we intend to win, and the others, too.” [John F. Kennedy, 1962]
“We choose to fly Carbon-Neutral in this decade and do the other things, not because they are easy, but because they are hard; because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one we intend to win, and the others, too. For there is no Plan[et] B.” [Jürgen Barthel, 2020]

Thinking Outside the Box is Not Everyone’s Cup of Tea

This week and last I attended two aviation financing conferences by Airfinance Journal, one in Japan, one in Latin America. Then I read an article by National Geographic, demanding that travel should be considered an essential human activity. But that is something I find so very often. Thinking Outside the Box and understanding psychologically different mindsets is Not Everyone’s Cup of Tea.

Airfinance Journal Virtual Events

Airfinance Journal Virtual EventsI am sure you remember my recent blog about why I consider Virtual Conferences a Barrel Burst.

Whereas a conference for me is a place we do networking, for which I am immensely grateful for Airfinance Journal (AFJ) to allow me attending the event. I sure couldn’t have afforded travel to Japan and Latin America. And thanks to their added focus on networking, it turned out some very promising new contacts to discuss KOLIBRI.aero with.

Let us have a look at the Latin America event which ended yesterday.

The Great Pretender

The Great PretenderWhereas AFJ added a virtual networking lounge, there were the same, I’d say ten, people in there, only once the (too small) window showing the delegates forced me to scroll with more than four delegates in the networking lounge.

Saving the delegate list and not counting the dupes I came up with 720 delegates. An awesome conference. 42 of which “filled out” their profile. Only. The others failed to use a free way to promote who they are and what they, respectively their companies do.

I happen to believe from what I have seen that most of the delegates of the online conference were obviously pretenders, signing up, but not showing up. Not even taking the time to log in and fill out their profile. Do they know there are such?

Virtual Networking

Airfinance Journal 2020 Latin America Dedicated NetworkingThen there was a “dedicated networking”, where more than 50 registered for (I think the host said 64). We were seven (plus AFJ moderator, plus one totally unresponsive), so roughly 9 out of 10 having registered for it did not show up. For some reason, being in aviation so long, “no shows” is something I consider exceptionally rude. Not just careless, but outright rude. Because there are people, taking the effort to organize something good and then people simply don’t show? It is extremely frustrating for whoever works this out to provide you a service!

For the few being there, I believe it was better than if it would have been crowded. I just hope I didn’t talk too much!

Overall, it just confirms my assumption that less than 10% of the registered delegates showed up at all. Of which again, how many have been speakers? 21?

Not My Cup of Tea?

Not My Cup of TeaAgain, these two events showed that there are different mindsets at play and it should be worthwhile to understand the motivation behind it.

I’ve seen that before, 20-odd years ago, when I organized the Airline Industry Stammtisch in Frankfurt. Many sign up for the event, to show their bosses, never intending to go there and spend their “valuable” time off elsewhere. Others, like me at AFJ do see the opportunity and value in networking.

Empty CabinA very good and valuable event, especially in Corona times. But it seems, at least from the outside, that most of the “delegates” were pretenders and never showed up on the website, never “participated”. Those people missed out on supporting a good event and torpedoed a valuable effort. From my side, I can only thank AFJ. The next step to improve the events in my opinion will be to automatically add the delegates to the networking lounge to enable messaging. Let them “opt-out”… There’s no e-Mail or other personal information shared, beyond the attendee list that delegates have access to anyway.

And they might want to promote to the delegates to fill out their profile… That’s free marketing and free networking!

Learning Curve?

Airfinance Journal 2020 China virtual eventThe next event coming up in two weeks as Airfinance Journal China, then followed by Asia Pacific. Hopefully the “delegates” are motivated to not only register to show-off to their bosses, but to really attend? And use the networking opportunities AFJ provides?

Because else, such virtual conferences turn to be a barrel burst. And that would not value AFJ but do them a big disservice! Did I mention? Aside failing on your job (or why would you sign up?), it backfires; no-one really likes “Dateileichen” (file corpses).


Of Nestlings and Birds of Passage

National Geographic: Why travel should be considered an essential human activity
Source and Copyright: National Geographic

Then there was that article on National Geographic: Why Travel Should Be Considered an Essential Human Activity

Which is another example of people focusing on their own life style, ignorant to others’ needs, motivation, life style. As I commented right away on LinkedIn:

A dozen years ago, I spoke with a friend/student, trying to convince her to join the aviation industry. There’s three types of people.

  • Nestlings, staying all their life in one place, except for the one or other vacation. A flight of more than two hours takes them to the unknown they fear.
  • Precocials, leaving home to move elsewhere and get settled. They travel for vacation and VFR.
  • Birds of Passage. They go, where live takes them, are open to the new and for them travel is a reward and each destination an adventure they embrace.

If you talk to nestlings, they will oppose your notion that travel would be “essential”. At the same time, they tend to be nationalistic and protective about their local environment. And the first to shut-down borders and travel. It’s those, “thinking different” being “in power” we have to catch and convince. To do that, we must understand their different “gut feeling”.

That said, if you talk crisis these days, it showed (most of) us, what privilege it is to be able to travel. And how quickly such privileges can be taken from us by forces beyond our control. And the lousy standing of travel lobbyists and lobbies with the decision makers.

A Lesson for the Crisis

Crowded Aircraft Aisle during BoardingConvincing the People to Fly Again

In all the discussions, it seems to be common opinion that we must regain the travelers’ faith to fly again. Given the (painfully) slowly sinking-in fact that we never might have “the” super vaccine, we better adjust our communications. We must understand that there are us “birds of passage”, looking forward to new experiences and adventures, but also the ones that are afraid of the new, the conservatives, the nestlings. And some of them being politicos, in my humble experience a lot of them narrow-minded, cover-your-ass-types that do not make a move unless they have to. As seen at the beginning of the crisis. Then they overreact out of fear, understanding they made a mistake, trying to cover up hysterically to distract from the mistake. Or like Trump now was caught in the act, lying to the U.S. people to “not spread panic”. Whereas a healthy panic is good! It keeps us alert. And then we must adapt. It’s called evolution. But that’s something many people are mortally afraid of.

Think Outside the Box

Blame GameThere are a lot of posts and speakers emphasizing that we must adapt to the crisis, think outside the box, then in the next minute turning back on why them keeping the status quo and doing as they always did would be the right thing. As they obviously fail to understand the thinking of their customers, shutting down the crisis, falling back to “safe thinking”. Just as most investors do.

As painful as it was, in fact it was truly funny. A speaker at Airfinance Journal Japan, an aircraft lessor, emphasized the time being right for new airlines. When I approached him, he retreated to the fact that they never lease to start-ups and would never invest in a start-up airline. Oh yes: Cognitive Dissonance at it’s best, right? This is a quite common stance when we talk to “aviation investors”, failing to understand that “aircraft investor” is not “aviation”, but just one piece of the puzzle. We represent an opportunity to place 200 aircraft in 10 years. Which is big business. Once we get the launch funding secured.

Me too … Or doing things different?

A320 B737 Whats Your USPWhile many still focusing “blindly” on “Airbus/Boeing” aircraft investments, they lost and loose money. It’s been a shark pond before the crisis, now that bubble imploded. At Airfinance Journal Latin America event, the best speaker was Walter Valarezo of DAE (Dubai Aerospace Capital), outlining the “abnormal normal” in the market pre-crisis. Now most investors curl up into a ball falling back to “old habits”.

USP is about “unique”. You don’t have a USP if you only copy what the others did. And stick to your modus operandi.

Fortunately there are some – very few but some – who do understand the opportunity, the need to think outside the box. Those are the ones we talk with. Will they help us launch the Kolibris? I guess they will. Let’s see how quickly we can convince them and their PTBs that change is good and our business plans are safe and sound. And benefits a great deal from this crisis.

Food for Thought
Comments welcome!

Kolibri @ Prestel&Partner Zurich December 2020