Not second best

Congestion at hub airports means that freighter carriers in the Middle East and elsewhere are rethinking where they fly to. Sarah Keats discovers that secondary airports have more to offer than at first glance.

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By  Sarah Keats Published  May 5, 2005

|~||~||~|Middle East airlines, like most others around the world, have traditionally flown their freighters into major airports, such as Heathrow and Frankfurt. However, congestion at these established hubs is causing costs to rise, while slots are becoming increasingly scarce. As a result, airlines are looking more at secondary airports, which are in turn also paying more attention to their cargo facilities and offering added benefits to entice in freighter services. But do these airports live up to the standards of the established ones — and why should Middle East carriers choose to fly to them? A number of issues are involved in making such a decision, as senior vice president cargo for Emirates, Ram Menen, outlines: “The main factors [for us] are the catchment area and the proximity to the market, distribution network and availability of efficient groundhandling and feeder services, plus our ability to make use of the resources we have efficiently. Overall cost is also a major consideration, as are any operational constraints, like night time curfews.” Europe has many examples of successful secondary airports in use, not least of all Germany’s Frankfurt-Hahn Airport, which provides a popular alternative to Frankfurt-Main Airport. “Flexibility, individual customer care and very simple processing are written in large letters at this airport,” comments the Frankfurt-Hahn press spokesperson, Nuray Güler. Frankfurt-Hahn attracts a number of cargo carriers from the Middle East, including EgyptAir, Iran Air and Royal Jordanian. Among the attractions of the airport, says Güler, are its 24 hour operation ‘without slot restrictions’ and the fact that it is situated in the ‘best economic region, right in the centre of Europe.’ She also points out that the ‘short routes to and from the apron to the highway and vice versa are among our most important competitive advantages.’ One of the difficulties that can arise at a major airport is noise restrictions, as seen currently at Frankfurt-Main Airport, which is facing a night curfew in exchange for a fourth runway. This could have a huge impact on its freighter services, and Frankfurt-Hahn is ready to step in to snap up this potential business. Cost is another reason to fly to a secondary airport. Frankfurt-Hahn offers up to 50% lower handling fees than other German airports, according to Güler. “The mutually compatible working procedures, the internal logistics at the airport and the presence of all the important authorities for the overall approval process at Hahn also rank very highly,” she adds. While secondary airports may offer lower costs, is this outweighed by their lack of connectivity to belly loads? Qatar Airways does not think so. Last month, it launched a thrice-weekly A300-600 freighter service between Doha and Munich International Airport, rather than following the crowd to Frankfurt. Munich does offer a wider range of connections than many secondary airports around the world, which Qatar is aiming to utilise, but the airline is mainly focusing on the local market. “Freight traffic to and from Germany is enjoying unprecedented growth which we are already experiencing through our passenger flights,” comments the airline’s CEO, Akbar Al Baker. “[This service is therefore] excellent news for small and large companies wanting to send goods between Germany and the Middle East and onwards to other points around the world.” “Munich is ideally located with a huge catchment area [to attract air freight],” adds Qatar Airways’ network manager for cargo sales & marketing, Klaus Eckhardt. The location of a secondary airport is crucial in attracting freighter business, agrees marketing director, traffic development at Munich airport, Alfons Wittl. He points out that only flying into major airports is not always sufficient for cargo distribution purposes. “Munich is in the south [of Germany], close to the Austrian and Swiss border, and our catchment area stretches even to western Austria and northern Italy, which are markets you cannot get in Frankfurt. This is a different market,” he stresses. Another Middle East carrier attracted to Germany’s secondary airports is Etihad, which has been operating passenger flights to Munich for a year and is only launching passenger flights to Frankfurt on June 1st. The Abu Dhabi-based airline already operates its first 55-tonne capacity A330-600 freighter on scheduled services to Frankfurt three times a week, to Amman twice weekly and once a week to Mumbai. The carrier is due to receive a second A300-600F in May, with a third later this year. Like other airlines, Etihad is looking at its passenger network first, before deciding on new freighter destinations. “Ideally located at our hub, the freighter services will complement our rapidly-growing passenger network,” says Etihad’s head of cargo & mail, Robert Strodel. Alongside location, the issue of slots is also a major concern for freighter airlines, and another reason why they are looking at secondary airports. In the UK, for instance, congestion at the major hubs is forcing freighters to look at secondary airports, such as Stansted. “It is pretty difficult for freighters to use Heathrow these days, because there are not many slots available,” says Geoff Conlon, business development manager at London’s Stansted Airport. “We are not a freighter airport, we are an international one, but we have substantial freight operations here and it is an important part of our business.” Few Middle East freighters fly into Stansted at present, with only EgyptAir serving the airport on an ad hoc basis. However, the airport attracts a lot of scheduled freighter services from around the world, and the total annual value of cargo passing through Stansted, including bellyloads, is estimated at over US $15 billion. “It is a substantial operation,” comments Conlon. Aside from slots, however, Stansted, like other secondary airports attracting freighters, offers services and infrastructure as well. Conlon says carriers take into consideration “having the facilities that they need to be able to handle whatever size aircraft, and road links, which are so key to a freight operation.” Cost is also a factor for carriers, but Conlon does not believe this is a major issue. “We may be marginally cheaper than Heathrow or Gatwick, but I think the attractions are the ability to get into an airport close to London, plus the infrastructure,” he says. Another regional UK airport that is focusing on airfreight is Nottingham East Midlands Airport (NEMA). Although no Middle East carriers fly there on a regular basis, Emirates did operate an ad-hoc B747-400F charter in January 2005, flying a tsunami aid relief flight for British aid agencies. The airport’s cargo development manager, Bill Blanchard, is keen to attract regular Middle Eastern services and outlines some of the incentives available. “We offer substantial daytime discounts on our standard runway and parking charges and also marketing support for new long-haul scheduled services,” he explains. “We also have the sixth longest runway in the UK at 2893 m TORA [take-off run available], four cargo terminals offering more than 50,000 m² of transit and sorting warehouse accommodation and five dedicated B747-400F aircraft stands — with more available on request. We also have two dedicated cargo handling agents with extensive equipment to handle AN-124 and B747-400F aircraft, and an EU-approved border inspection post for non-EU animal products,” he adds.||**|||~||~||~|NEMA is the UK’s second largest cargo airport after London Heathrow and handled 280,000 tonnes of cargo in 2004. According to Blanchard, it has “uncongested airspace, is ‘freighter friendly’ and has extensive cargo handling experience and expertise”. Its central UK location is “an ideal gateway for cargo distribution and consolidation to and from all of the UK’s major cities,” he adds. Another huge advantage for freighters landing at Nottingham, is the speed and efficiency with which their cargo can be distributed in the UK. “Cargo can be in central London quicker via NEMA than it can via London Heathrow, due to the expeditious transit of cargo through the facilities at NEMA and the speed of HM Customs clearance,” says Blanchard. Elsewhere in Europe, Barcelona is busy attracting more freighter business, receiving three new services in less than six months last year. The first one was launched on May 1 by Royal Jordanian with one flight a week using an A310F. The Amman-Barcelona-Amman flight has now been temporarily ‘paused,’ says Anais Fabregas, cargo development executive at Barcelona Airport Cargo, “but [it] will soon be operative again.” The airport has a lot to offer cargo operators, say Fabregas. “We say Barcelona is the gateway to the East, referring to the East as the Mediterranean region, Eastern Europe, the Middle East and, of course, Asia,” he explains. Barcelona is sensitive to the issues that surround an airline’s choice of airport: “We know that a company taking a decision to establish a new freighter service in a new destination involves a lot of factors. That is why we not only keep in touch with the companies we think might have an interest in coming to Barcelona, but we also keep on improving and developing new infrastructure, so if they opt for Barcelona, they find the best quality of services and operations,” Fabregas says. Cargo facilities are a key attraction for freighter operators and the Spanish airport is already building five more warehouses, covering a total area of 30,000 m² to accommodate growing demand — in the first three months of this year, cargo traffic increased by 17%. “This increasing cargo potential and the fact that there are not too many freighter flights coming to our airport — and therefore not a lot of competitors — are two of the main advantages for airlines to take the chance [to operate here],” remarks Fabregas. In Asia, the issue of secondary airports is not as immediate as in other parts of the world, because its major airports, such as Changi, Singapore, Incheon, Seoul and Hong Kong International, have been built with cargo growth in mind. Emirates already flies scheduled freighter services to Changi Airport, for instance, which introduced a $125 million Air Hub Development Fund in 2003 to “help our airline partners operate a profitable business,” says Julia Jemangin, assistant manager, public relations, at Singapore’s Civil Aviation Authority. “Under this incentive scheme, landing fees and warehouse and office rental space in Changi have been reduced by 15% for three years starting 1 January 2003. With the reduction in landing fees, Changi Airport’s aeronautical charges are now the second lowest among major airports in the region,” states Jemangin. Last year, Changi Airport handled 1.78 million tonnes of cargo, and it has the capacity to handle 2.7 million tonnes, meaning there is plenty of potential for freighter carriers to utilise the facilities. Secondary airports are perhaps more important in America, where major passenger hubs such as the west coast’s Los Angeles International and San Francisco International airports, are being increasingly bypassed by freighter carriers for airports in smaller cities, such as Oakland and Portland, Oregon. A report from the Public Policy Institute of California shows that congestion at San Francisco and Los Angeles airports is forcing carriers to look elsewhere, and states that ‘the potential for cargo at lesser airports is very real.’ In recognition of this, Los Angeles World Airports has developed a regional air cargo strategy, encouraging carriers to fly freight into Ontario International Airport, an inland airport east of LA. While main airports will always attract new business, smaller, regional airports are becoming increasingly wise to the needs of freighter airlines, namely lower costs, adequate facilities, location, noise restrictions, groundhandling, road feeder service and the availability of slots. With many Middle Eastern carriers expanding over the coming months and years, flying freighters to secondary airports around the world could be their most viable option. As Emirates’ Ram Menen concludes: “Overall, the fact is that the decision is based upon commercial requirements, but with operational flexibility as a major consideration.”||**||

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