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German air cargo operations have always gone through Frankfurt, but developments at that mega-hub are raising the profile of other airports
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Europe's New Alternatives

German air cargo operations have always gone through Frankfurt, but developments at that mega-hub are raising the profile of other airports

Frankfurt is trying to ensure its place as a powerhouse of the European aviation market by adding desperately needed runway capacity, but the greater capacity apparently can only be achieved by introducing a tough ban on certain night flights. That has opened a golden opportunity for second-tier German airports, making the country a new arena in the attempts to build up alternate cargo gateways.

From the large airfields at Cologne and Munich to Frankfurt Hahn and Liepzig, more of the air freight business in Germany is increasingly looking at less familiar paths to markets within Europe and to global trading posts.

Munich airport is known widely as Lufthansa's second German hub. But as an alternative to Frankfurt, the national carrier is ambivalent toward developing certain services out of the Bavarian gateway.

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That attitude seems to have settled with the airline operating a growing range of long-haul services out of the airport, mostly to the United States and Asia. Lufthansa now operates daily frequencies to both Hong Kong and Beijing. Sixteen A340s are based at Munich, and that number is projected to climb to more than 40 in the next few years.

"The increase in frequency of daily service to many long-haul points, particularly to Asia and the US is a trend which is being reflected by other carriers operating to the airport," says Markus Heinelt, air freight marketing director for Munich airport. "It is providing us with an important boost to bellyhold cargo capacity, not only in terms of volume, but also in terms of frequencies. Service providers are now choosing to take the opportunity of consolidating traffic over Munich, rather than Frankfurt, with more business coming from Austria and Northern Italy."

Munich still has some difficulty attracting and maintaining regular freighter operations, however. Qatar Airways this year withdrew its recently started three-times-weekly A300 freighter service to the Middle East. Similarly, Emirates ceased its weekly 747-200 freighter operation, although the carrier is back with a weekly A310 freighter to Dubai.

Still, Cathay Pacific remains with its 747-200 freighter to Hong Kong via Dubai and says it may be upgraded to a 747-400 operation.

This has helped Munich airport boosts its cargo figures in the first half of this year to 106,000 tonnes, a 10 percent gain. In March, MUN set a single-month record with just under 20,000 tonnes. At current growth rates, the airport projects cargo business to expand from the 350,000 tonnes handled in 2005 to more than 1.3 million tonnes by 2020, potentially pushing Munich into the higher levels of global air cargo transport.

To accommodate its projected growth, the Munich airport authority is planning a new runway by 2011.

In the cargo area, a 48,500-square-foot facility opened at the end of 2005; it's designed specifically to handle the needs of the express operators at the airport. DHL, FedEx and UPS are early tenants.

Heinelt says a new logistics center is planned for the end of 2007. The center will provide an additional 377,000 square feet of space for forwarders, plus additional space for perishables.

Munich's cargo ambitions are partly driven by the rich hinterland at its doorstep.

"Munich airport is attributed with being the economic engine driving Bavaria's rapid development as the 'Silicon Valley' of Germany and economically one of the most vibrant regions in Europe," says Heinelt. "International giants such as BMW, Siemens, Toshiba, Adidas and Texas Instruments have all made Bavaria their European or global headquarters."

That translates directly into 1,700 tonnes of cargo business daily out of Southern Germany.

Cologne-Bonn airport lost the unofficial title of the country's capital airport when the federal government years ago shifted the seat of power of a re-united Germany back to Berlin. But the Rhineland gateway can still lay claim to being the No. 1 integrator hub in Europe. That is largely built on the massive presence of the European hub operation of UPS, which boosted the airport's cargo figures to 655,000 tonnes last year, with an expectation that they will climb to over 700,000 tonnes this year.

UPS reinforced its position at the airport this year with a new $135 million facility, doubling to 813,000 square feet the size of its footprint at the gateway.

This investment represents the integrator's largest outside of the United States. It will provide a sort capacity of 110,000 packages per hour, with the capability of expanding that to 165,000 packages.

FedEx, with Memphis bound MD-11Fs and DHL, with an intercontinental joint MD-11 freighter deal with Lufthansa Cargo, also reside at the airport.

On paper, Cologne-Bonn can rightly claim to be Germany's second busiest cargo hub in volume. But airport officials admit that this is a distortion of the real picture. "We recognize that 90 percent of our cargo volumes are represented by integrator traffic, mostly moving through the airport at night," says airport chief executive Michael Garvens. "What we want to do is attract more daytime freighter traffic."

The airport has had some success with the weekly British Airways 747-400 stop-off en-route from the United Kingdom to Shanghai. More recently, Turkish carrier MNG Airlines initiated A300 freighter service four-times-weekly service between Cologne-Bonn and Istanbul. Inbound traffic consists of textiles mostly, with return loads of car parts and pharmaceuticals.

Garvens says the airport is marketing its freighter credentials hard, but it is mainly the forwarders and logistic service providers which dictate where carriers operate. "It is these people who create the business and traffic flows for the cargo operators these days," says Garvens. "It is up to us to provide the best handling facilities and capabilities as an airport operator."

On those terms Cologne-Bonn is already planning to invest in the provision of new forwarder facilities at the airport.

In some respects Cologne-Bonn faces a contradiction in its approach to developing belly cargo traffic. The airport has established itself as the leading low-cost carrier hub in Germany. But most budget carriers have little interest in carrying cargo.

"The business model of these operators demands short turn-around-times and no add-on costs for handling cargo," says Garvens. "It is a pity, because we can see a real opportunity for cargo on some of the routes operated by these airlines, such as between Cologne and Moscow."

Although Cologne-Bonn wants more credibility as a daytime cargo hub, its future may be as a nighttime integrator hub. The airport's night flight license extends to 2015 currently. But the news that would-be integrator hub Leipzig has a similar license extending to 2035, may prompt intense lobbying in Berlin, from the Cologne-Bonn camp and leading tenant, UPS.

If you've not heard of Leipzig airport, you soon will. By 2008, DHL will move its entire European hub operation from Brussels to this East German cast-off.

DHL is making the move in a fit of pique over refusal by the Belgian authorities to allow DHL to increase its nighttime operations out of Brussels' Zaventem airport. What better opportunity for DHL owner Deutsche Post World Net to bring its integrator operation onto German soil?

Liepzig lobbied Brussels to increase the number of nighttime movements from 21,000 movements per year to 34,000, along with a significant increase in aircraft size. DPWN proclaimed it will invest $390 million in its new site, which is threat-free from night flight bans.

According to Evelyn Schuster, head of Liepzig airport's marketing and public relations, the local East German skyline is beginning to change already. "Most of the infrastructure work has been completed to accommodate the new DHL hub operation," she says. "Today you can see the structures of the hub facility and new hangar complex for DHL beginning to appear."

Leipzig intends to ride the DHL wave for all its worth.

"This provides Leipzig airport with an important opportunity to establish itself as a cargo hub beyond accommodating the needs of a major express operator like DHL," says Schuster.

The airport recently completed work to re-align its second runway to provide, in effect, two parallel runways capable of handling simultaneous landing and take-offs. Schuster says work has begun on developing more facilities for independent cargo handling operations.

"We are looking to develop a frontline facility capable of handling 200,000 tonnes a year," she says. "One third of this facility has already been assigned to the local airport handling company."

Leipzig wants to attract major Asian cargo carriers to better compete with other German airports and near neighbors such as Vienna.

The airport's logistics operation received a recent lift from an unlikely source.

NATO chose the former East Germany airport as the central location for its Strategic Airlift Interim Solution project. With no delivery in site for the new Airbus A-400M military transport, NATO is resigned to leasing capacity on an AN-124. Under a deal with Volga-Dnepr Group and the Antonov Design Bureau, two AN-124s are on permanent standby at Leipzig, with four more aircraft available for short order call-up.

Schuster says the two AN-124s at Leipzig altered dramatically the local skyline, but no special accommodation has been made for these behemoths. "In fact, we rarely see the aircraft standing idle because they are kept so busy on NATO missions."

 
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