Business / Corporate | FOCUS

ANA group spreads wings to pilot training as new revenue source

by Keiichiro Otsuka

Kyodo

ANA Holdings Inc., the parent company of All Nippon Airways Co., is expanding training programs for pilots and air traffic controllers at its academies in the United States, Japan and Thailand, seeing opportunities in the global pilot shortage stemming from the growing number of budget airlines taking to the skies.

Under its long-term business plan, Japan’s biggest aviation group by revenue is aiming to derive around ¥375 billion ($3.03 billion) from operations peripheral to its mainstay passenger and cargo flight services in fiscal 2025.

This amounts to roughly 15 percent of its projected consolidated revenue for the business year, which ends March 2026. It also represents an increase of approximately 90 percent from the company’s comparable estimated fiscal 2015 revenue.

Among those collateral businesses, the aviation training unit is deemed to be a driving force of growth. The unit is backed by a pool of talent and resources, and has at its center the U.S. pilot incubator unit that the company acquired in 2013 for $139.5 million.

Training is offered at a building adjacent to Miami International Airport in Florida that carries the iconic Pan Am globe logo which once also adorned U.S. carrier Pan American Airways before it went bust in 1991.

Inside, a section of the school is devoted to Pan Am memorabilia, including models of jumbo jets, photos of cities that Pan Am served, and an image of Charles Lindbergh, the first man to fly the Atlantic, side by side with Pan Am founder Juan Trippe.

The heart of the U.S. academy consists of 29 full-flight simulators that train pilots to fly different kinds of aircraft, including two each of Boeing Co.’s mainstay aircraft — the 737, 767 and 777. Full-flight simulators generally cost ¥1 billion to ¥1.5 billion per unit.

Prospective pilots can also undergo training for the MD82 and MD88 of former McDonnell Douglas (now Boeing), which are relatively old models still flown by several carriers in the Americas.

Haruo Ezuka, the academy’s president and CEO, says, “We are meeting a broad range of needs from major commercial carriers to small companies that don’t have their own training facilities.”

Among its clients are major aviation companies such as United Airlines Inc., a key partner of ANA in the Star Alliance group of global airlines, and Aeromexico, the Mexican carrier in Skyteam, a competing airline alliance, as well as smaller airlines mostly in the Americas.

As demand for training expands, simulators are projected to log 94,000 hours of operations in 2015, up from around 91,000 hours in 2014.

“Pan Am being the trailblazer of commercial aviation, its name recognition is extraordinary and has been helping us sign up clients,” Ezuka said, adding that as demand for pilot training remains strong.

The flight school is also equipped with a mock passenger cabin for training flight attendants as well as a large screen and a computer graphics projector to show what the view of an airport looks like from the control tower.

Jose Aragon, a chief instructor in air traffic control, says, “We give training in flight simulation even for prospective air traffic controllers so that they can get a view of what a pilot is going through.”

Using the know-how gained through the Florida school, ANA last year set up Pan Am International Flight Training Center (Thailand) Ltd. to meet training demand in Asia.

The Florida academy’s chief operating officer, Gary Anderson, who serves as the CEO of the Thai center, said he would like to see skills passed on from the U.S. school to the Thai unit.

The Thai center, jointly owned by the ANA group and Thai budget carrier Nok Airlines, is set to start operating this summer with two full-flight simulators.

In Japan, Tokyo-based Panda Flight Academy is offering training with two simulators. Boeing projects demand for pilots will increase by 533,000 in 20 years from 2014. Of this number, around two-thirds will be in the Americas and the Asia-Pacific region.

ANA is planning to use its training operations in the United States, Japan and Thailand to meet rising demand in these two key regions.

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