STRONGER: INFRASTRUCTURE
While uncertainty about the impact of U.S.-led tariffs and a potential “hard Brexit” has left many cargo heads unwilling to speculate on changes to next year’s Top 50 airport list, there is enough optimism generated by the 2017 cargo boom to ensure that new, long-term infrastructure is being planned at several air hubs to handle the e-commerce surge that is expected to continue.
According to recent research from Frost & Sullivan, airports worldwide will be spending $4.63 billion by 2023 to digitalize their passenger and cargo processes. The report, titled “Digital Transformation in Airports,” predicted that European airports are investing in digitalization “due to physical infrastructure constraints,” while Asia-Pacific airports are seen as “more open to innovation” as a motivator for IT upgrades.
“As airports transition to a data-driven infrastructure, there will be a considerable investment in data analytics, storage and security products and services,” said the Frost & Sullivan report. “The industry will also witness the growth of digital platforms that consolidate all data-driven functions and processes.”
Hong Kong, which is already working on its third runway project, said it is anticipating a “steady cargo growth in 2019” and expects cross-border e-commerce, temperature-controlled airfreight and trans-shipments to “continue to be the major drivers of the growth.” For instance, DHL plans to expand its Central Asia Hub (CAH) at HKG by 2022, when the annual throughput is predicted to rise by 50 percent to 1.06 million tonnes. Also, the tender of the Premium Logistics Centre in HKG’s South Cargo Precinct was awarded to a joint venture led by the Cainiao Network, the logistics arm of Alibaba Group.
Another important hub that is planning a third runway is SIN, which Yip said wants to compete more directly with HKG as a major trans-shipment hub. “We have always positioned ourselves as a gateway to the ASEAN countries, including Australia and New Zealand,” she said. “We always plan capacity in tandem with growth.” The third runway is expected to be operational “in the early 2020s,” she added.
At Frankfurt, Weill said FRA is now seeing more volumes headed to Asia, which recently overtook volumes to the United States as the airport’s No. 2 export destination. “Based on cargo type, e-commerce volumes are growing, as are temperature-controlled shipments and live-animal shipments,” he said.
LAX’s Badlissi said Los Angeles is moving forward on its Century Cargo Redevelopment project, to modernize its existing facilities and increase capacity. “One possibility might include increasing capacity vertically in some of our existing facilities, which would be a first at any U.S.-based airport,” he added.
After January 1 of the new year, there will be a brand-new hub that might make the Top 50 list in future years when Turkish Cargo will shift its belly cargo operations – about 75 percent of its air cargo business – from IST to ISL, outside Istanbul later this month. Meanwhile, Turkish Cargo’s freighter services will continue operating at the old IST hub.
Next year, when Air Cargo World examines the figures from 2018, we expect to see more of the same growth and optimism in the airfreight business. However, investors hate uncertainty, and that is what is looming as we stand on the precipice of 2019. ACI also acknowledged that the air cargo journey ahead may still be fast, high and strong for most airports, but the political storms that are brewing may lead to a bumpy landing in 2019.
“The threat of heavy-handed regulation that hinders the economic sustainability of airport investment and operation and changes in international trade policy remain fundamental concerns,” said Angela Gittens, director general of ACI World. “Global air service growth has remained resilient, but the continuing impact of protectionism and trade wars on international air transport services will likely have a major impact on airports in the future.”
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