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World Passenger Symposium 24 26 October 2017 Centro de Convenciones Internacional de Barcelona (CCIB) World Financial Symposium 2014 World Passenger Symposium 2017

Opening Plenary

World Passenger Symposium 2017

Economic Outlook and Passenger Forecast Andrew Matters Head of Industry Analysis World Passenger Symposium 2017

Traffic volumes have grown strongly in 2017 Billions per month 690 640 RPKs, seasonally adjusted FTKs, seasonally adjusted Billions per month 20.5 19.5 590 540 490 440 2012 2013 2014 2015 2016 2017 18.5 17.5 16.5 15.5 14.5 Source: IATA www.iata.org/economics World Passenger Symposium 2017

Driven by an improved economic backdrop 57 Composite PMIs (50 = no change) 56 55 Advanced markets 54 53 Global 52 51 50 Emerging markets 49 48 2012 2013 2014 2015 2016 2017 Source: Markit www.iata.org/economics World Passenger Symposium 2017

and lower fares US$ per RPK, seasonally adjusted 0.130 0.125 0.120 0.115 Global average yield, US$ constant exchange rate (Jan 2011) 0.110 0.105 0.100 Global average yield 0.095 0.090 0.085 0.080 2011 2012 2013 2014 2015 2016 2017 Source: IATA www.iata.org/economics World Passenger Symposium 2017

But strong demand doesn t guarantee financial health % of invested capital Return on capital invested in airlines 10 Cost of capital (WACC) 9 8 7 6 5 4 Return on capital (ROIC) 3 2 1 0 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Source: IATA www.iata.org/economics World Passenger Symposium 2017

A change in load factor performance has helped Breakeven and achieved weight load factors 69 Achieved 67 65 % ATKs 63 61 59 57 55 Breakeven 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 Source: IATA www.iata.org/economics World Passenger Symposium 2017

so too capital productivity gains 10 1.5 Operating margin, % revenue 8 6 4 2 0-2 -4 Capital productivity Operating margin 1.4 1.3 1.2 1.1 1.0 0.9 Capital productivity, revenue/invested capital, US$ -6 2000 2002 2004 2006 2008 2010 2012 2014 2016 Source: IATA www.iata.org/economics World Passenger Symposium 2017 0.8

Although net profit is still just US$7.70 per pax 20 15 US$ 18.15 16.32 2016 vs 2017(f) 10 5 2.15 2.87 8.67 6.94 6.03 4.96 5.31 1.78 9.10 7.70 0-5 Source: IATA www.iata.org/economics -1.45-1.50 Nth America Latin America Europe Asia Pacific Africa Middle East Industry World Passenger Symposium 2017

Pax demand to double over the next 20 years Global passengers (O-D basis, billion) 10 A Relaxing of Regulations 9 Constant policies scenario 8 A Pick-up in Protectionism 7 6 6.7bn 5 4 3 2 3.3bn 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 Source: IATA/Tourism Economics www.iata.org/economics World Passenger Symposium 2017

Where s the growth coming from? North America 452m 2.3% Latin America 421m 4.2% Europe 550m 2.3% Middle East 322m 5.0% Africa 274m 5.9% Asia Pacific 2,066m 4.6% Source: IATA/Tourism Economics www.iata.org/economics World Passenger Symposium 2017

The Top 10 air passenger markets 2036 vs 2016 Source: IATA/Tourism Economics www.iata.org/economics World Passenger Symposium 2017

A pivotal moment approaches % of global O-D passengers 70% 60% 50% Within developing markets 40% 30% Within advanced markets 20% 10% 0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Between advanced and developing markets 2027 2028 2029 2030 2031 2032 2033 2034 2035 Source: IATA/Tourism Economics www.iata.org/economics World Passenger Symposium 2017

www.iata.org/economics

Leading New ICT, Enable Industry Digital Transformation Xilin Yuan President of Transport Sectors, Huawei Technologies Co., Ltd

Huawei at a Glance 71.5B $ 180,000 80,000 15 NO. 72 NO.129 Revenue Employees R&D employees R&D institute and centers Interbrand's Top 100 Best Global Brands Fortune Global 500 2

Of the global population Countries 3

Digitalization Begins with Connection 4

Innovation Story: Internet of Elevators/Escalators Centralized O&M, reduce OPEX by 50% Cloud-Edge Collaboration, shorten Troubleshooting Time 90% IoEE, a health indicators, to make the elevators smart real-time elevator monitoring by Schindler 15 million elevator around the world, with 700+ sensors on each one 5

Innovation Story: Internet of Luggage NB-IoT Track your Bag, anytime, anywhere NB-IoT luggage tracking solution by Vodafone and Samsonite Mobility 6

Transformation is accelerating, comes to the inflection point Cloud service 1 st Cloud Service (Amazon) 11 years Using Cloud > 40 millions Mobile Broadband 1 st Mobile Video Service (Docomo) 16 years MBB users >2 billion Connection 1 st M2M Connection (Siemens) 22 years IoT connections >8 billion 1995 1999 2001 2006 2017 7

Data becomes the new Core Elements People Wealth Things Data Data becomes the new core elements Connect Employee Customer Product Equipment Process Partner 8

Digitalization Demands New ICT Architecture 9

Cloud-Pipe-Device Architecture, Enable Digital Enterprise Data processing Cloud Digital enterprise Data transmission Synergy Pipe Data generation Device Enterprise digitization should be an organic process 10

The Value of the Cloud Lies Beyond the Cloud SIPG shipment tracking app @ Huawei Cloud Cloud Public Cloud/ Hybrid Cloud Low initial investment and on-demand expansion Service rollout in 18 days 11

Solving the Challenges of Devices Goes Beyond Devices Connect Millions of Ofo bikes thru NB-IoT NB-IoT Network adapted to devices Lower cost Massive connections NB-IoT Lower power consumption Wide & Deep Coverag 12

Innovation Need Gathering Powerful Ecosystem Open: for industry innovation Elastic: for business expansion on demand and agile migration of apps Open/elastic/flexible/secure platform Flexible: for every industry scenario Secure: hardened from end to end Business-driven 13

Best Partner in the digital transformation Era Technology Platform Ecosystem Cloud Computing SDN IoT Big Data Mobility Flexibility Security Openness Resiliency Developers Standards Partners Opensource Community 14

Huawei BDII Promoting digital transformation ICT Convergence Capabilities Product Innovations Transportation Network Cloud OS Finance Government Power Manufacture Applic ation esdk Cloud Big Data Social IoT Mobility CPS Drive Enable Storage Server Enterprise Wireless Big Data Security UC Industry Customers Partners Huawei 15

Huawei's Practice on Digital Transformation Today Objectives Huawei IT investment IT support business development Huawei IT 28 innovation centers 30% 70% O&M Transformation 70 PB Data, 80% on cloud 170+ countries 180 Gbit/s network bandwidth ROADS experience Leading operational efficiency (Note: Most companies in the industry spend 70% of their budgets on O&M) 80,000 R&D employees 180,000 employees Building a fully digital Huawei in 3 to 5 years 16

Expanding the Global Network of OpenLabs London Moscow Munich Established Planned Paris Dallas Dubai Suzhou Huawei s OpenLabs Plan Cairo Bangkok Singapore Mexico City 5 12 20 2016 2017 2019 Johannesburg USD 200 million investment in next 3 years 17

Joint-Innovation with 200+ Industry Partners HW+ HNA Eking elte based GHMS solution HW+ Shenzhen Airports Strategy Partner in elte, IoT HW+ DHL IoT based supply chain HW+ SIPG Shipment Tracking Platform @ Huawei Cloud HW+ Ofo: NB-IoT+ Big Data enables precise predictions about requirement of Bike HW+ Honeywell Smart building solution 18

Footprints in the Aviation Market Until 2016, Huawei serves more than 40 Aviation customers in 20+ countries 19

Copyright 2017 Huawei Technologies Co., Ltd. All Rights Reserved. The information in this document may contain predictive statements including, without limitation, statements regarding the future financial and operating results, future product portfolio, new technology, etc. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied in the predictive statements. Therefore, such information is provided for reference purpose only and constitutes neither an offer nor an acceptance. Huawei may change the information at any time without notice. THANK YOU

From Simplifying the Business to Global Industry Transformation Eric Leopold Director Transformation, Financial and Distribution Services, IATA World Passenger Symposium 2017

Innovate with speed Eric Leopold Director, Transformation, Financial and Distribution Services IATA World Passenger Symposium 2017

A customer vision for 2020 air travel

#flying is cool

A vision defined back in 2012 2011 2012 2013 2014 2015 2016 2017

StB innovations of 2017 2017

The stages of the customer journey Inspire Shop Order / Pay Experience

Customer-centric air travel value chain approach IT Providers Payment providers Airlines Intermediaries Traveler Buyer Airlines suppliers Travel partners Regulators Trade associations

3 phases of industry change 2004-2010 2011 202x 2018+ Automating complexity Digital transformation Industry transformation

The lifecycle of an industry standard Ideation & Inception Benefits realization Accelerate the cycle Consensus to change & adoption Implementation Design & Development

What was driving the changes? The perfect storm 2004 StB launch 2008 100% E-ticket 2011 WPS & think tank 2014 NDC approval 2017 Barcelona Paper Fuel, 9/11 LCC E-commerce Standards Economics Competition Technology 2001 2017

WPS 24-26 October 2017 Theme Opening Innovating better together Big picture Value Chain Tracks Distribution CIO Forum Baggage Tomorrow s journey Technology Inflight Closing Innovation

What will be the future milestones? 2018: Risk & Fraud 2019: Payment 2020: Distribution 2021+ Fulfillment The new normal Travel agent credit risk is limited FOPs have received airlines consent Critical mass of airlines constructing their indirect offers Airline orders are settled without E- tickets 2001 2017

How to innovate with speed? Open innovation with disrupters Accelerate innovation through incubation and funding Bring innovation to market with speed

Vision for digital airline Enhanced distribution and payment Streamlined Fulfillment Safe transparent agent sales Control of data exchange Streamlined procure-to-pay NDC ONE Order NewGen ISS TIP Open API SAI Governance built for speed Design the Future Innovate with speed Test and learn

Thank you

Leadership Panel: Disruption and Transformation is Shaking and Moving the Aviation Industry Moderator: Aaron Huslehurst, Presenter, BBC World Panelists: Susan Doniz, Group CIO, Qantas Paul Griffiths, CEO, Dubai Airports Company Calum Laming, Chief Customer Officer, Vueling Paul Tilstone, Managing Partner, FESTIVE ROAD and Board Director, Global Business Travel Association (GBTA) Aidan Brogan, CEO, Datalex Q&A: slido.com #wps2017 World Passenger Symposium 2017

World Passenger Symposium 2017