Implementing new systems helped to dramatically reduce the amount of baggage that was mishandled by airlines last year, saving the industry as much as $800-million.

The fifth annual edition of SITA's Baggage Report shows that the amount of mishandled baggage – checked baggage that has been delayed, damaged or pilfered – fell by over a fifth last year from 42,4-million bags in 2007 to 32,8-million bags in 2008. The number of bags actually lost or stolen also tumbled from 1,28-million to 736 000.
Francesco Violante, CEO of SITA, says: "The good news is that for the first time since we started publishing this report there has been a significant drop in both mishandling and lost baggage rates. With almost 10-million fewer bags mishandled last year, the industry saved some $800-million.
"Partly this is due to industry initiatives which have resulted in fewer bags being checked-in, and hence fewer bags mishandled, but it also shows that baggage processing initiatives – such as IATA's Baggage Improvement Programme (BIP) and SITA's integrated baggage management solutions – are delivering positive results and helping both the industry and passengers alike."
SITA, the aviation IT specialist, operates WorldTracer, the industry-standard, fully-automated system for tracing lost and mishandled passenger baggage used by over 440 airlines and ground-handling companies worldwide. Last year the WorldTracer database showed a mishandling rate of 14,28 bags per 1 000 passengers worldwide, compared to 18,86 per 1 000 in 2007.
The great majority of these 32,8-million mishandled bags were reunited with their owners in less than 48 hours and only a small fraction – 0,32 bags per 1 000 passengers, or 736 000 bags – failed to show up at all compared with 0,57 per 1 000 passengers or 1,28-million bags in 2007. This improvement reduced industry losses by $800-million to $2,9-billion last year.
The numbers of passengers travelling in 2008 was stable (up by just 1,4% on 2007) at 2,3-billion passengers. The drop in mishandled baggage numbers can be due to several reasons, among them the increasing number of airlines charging for baggage resulting in fewer bags being checked-in. Some airlines have also relaxed their policies concerning carry-on baggage reducing the need to place bags in the hold.
Airlines and airports are working hard on the baggage issue; 49% of airlines and 55% of airports surveyed by SITA in 2008 gave high or very high priority to IT investment to "improve baggage processing and management".
Airlines would like to see both checked and carry-on baggage volumes reduced because lower weight means less fuel burned and fewer bags mean speedier aircraft turnaround times and less compensation paid for mishandled and lost bags.
There is a clear trend across the industry towards encouraging passengers to travel with fewer and lighter bags, or ensuring that passengers pay the costs associated with checking in baggage. Ancillary revenues related to baggage charges are growing at many European and North American airlines.
With airports around the world operating at full capacity, the apparent reduction in the number of bags being checked-in, and lower volumes of passenger traffic reported towards the end of 2008, have relieved the pressure on airport infrastructure including baggage handling systems.
The single biggest problem for baggage handlers is when bags are being transferred from one aircraft to another – though the percentage of bags mishandled in transit as a percentage of all mishandled bags, has been falling steadily, from 61% in 2005, to 49% in 2008.
Other causes of mishandled baggage, as registered by WorldTracer, are: failed to load – 16%; ticketing error/bag switch/security/other – 13%; arrival station mishandling – 8%; airport/customs/weather/space-weight restriction – 6%; loading/offloading error – 5%; and tagging error – 3%.
IATA has recently presented its Baggage Improvement Programme to over 180 airlines around the world and aims to cut baggage mishandling in half by 2012 – generating annual savings to the industry of between $1-billion and $1,9-billion depending on the range of issues addressed. Some airlines are already reporting dramatic reductions in mishandling rates as a result of this programme which targeted nine airlines and nine airports last year.