Real-Time RFID Bag Tracking Could Save Airline Industry Billions

Open Jaw

The global deployment of Radio Frequency Identification (RFID) technology, which can accurately track pax baggage in real time across key points in the journey, has the potential to save the air transport industry more than USD 3 billion over the next 7 years.

Global IT provider SITA and IATA report that the highly accurate tracking rates of RFID technology could reduce the number of mishandled bags by up to 25% by 2022, mainly through efficient tracking. The SITA/IATA business case , released at the IATA World Passenger Symposium taking place in DXB, outlines how this will provide a major saving for airlines and deliver more certainty for pax. Initial deployments of RFID by airlines, such as DL, show a 99% success rate for tracking bags.

In particular, RFID will address mishandling during transfer from one flight to another. And, RFID technology will ensure that airports, airlines and ground handlers are able to keep track of bags at every step of the journey and ensure the right bag is loaded onto the correct flight. The technology also supports IATA’s Resolution 753 that requires by 2018 airlines keep track of every item of baggage from start to finish.

The deployment of RFID would build on the already significant savings delivered by the smart use of technology for baggage management. Technology has already helped reduce the number of mishandled bags by 50% from a record 46.9 million mishandled bags in 2007, thus already having saved the industry USD 22.4 billion. This improvement comes despite a sharp rise in pax numbers over the same period.

Jim Peters, Chief Technology Officer at SITA, said: "The airline industry is at the brink of a revolution in baggage tracking. Deploying RFID globally will increase accuracy and reduce mishandling rates. This is a win-win situation – passengers will be happier, operations will run smoother and airlines will save billions of dollars."

The SITA/IATA business case shows that the improvements in handling rates do not come at a great cost. RFID capabilities can be deployed for as little as 1¢ per passenger on average while generating expected savings of more than 2¢  per passenger. With some big airlines and airports already introducing RFID technology, combined with the fact that it is compatible with existing barcode technology, adoption of RFID across all airports could provide a positive return for airlines, both in cost savings and pax satisfaction.

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