10


Issue 4 2014 - Freight Business Journal


‘We’ll double cargo capacity’ says


Heathrow report


Heathrow airport promised to double its existing cargo capacity as part of its plans to expand the UK’s largest airport published on 13 May, and submitted to the Government’s Airports Commission on 14 May. In a scheme to create “a world-class global gateway to make Britain proud”, it also said it would add 40 new direct, daily routes to fast growing economies such as San José, Wuhan and Kolkata. The Airports Commission


is considering a number of


competing schemes to


increase airport capacity in south-east England, including new runways for Heathrow or Gatwick, or an entirely new airport on an island in the Thames Estuary. However, none of the schemes are expected to get under way until after the next election. In its submission, Heathrow


pointed out that, in value terms, it is Britain’s most important port as air freight accounts for 40% (or around £400bn) of total UK imports and exports and most of it comes through Heathrow, which moves more freight than every other UK airport combined. Low-cost airlines tend not to carry freight which is why Gatwick accounts for less than 5% of UK air freight, it said. In


the report, Heathrow


pointed out that some of the existing cargo buildings were


life-expired and would soon need replacing. It promised to develop a masterplan for the cargo zone to allow the efficient redevelopment of older facilities, which was likely to involve a degree of land swap to produce ideal development areas. It added: “We estimate the


total additional land available for all cargo uses in the zone as 13.3 ha - an increase of more than 30% on today’s figure. This growth in area, together with the efficiencies possible from rationalised facilities, will enable the doubling of cargo throughput for this area from 1.5 million tonnes per year today to meet the forecast demand of 3 million tonnes per year in 2040. This compares with current freight throughput at Frankfurt airport for example of 2 million tonnes in 2014.” There would also be


opportunities to consider the relationship of the cargo sheds to the airside, which might remove the need to take cargo from the sheds through a control post to reach the aircraft, “vastly speeding up the efficiency and reliability of cargo loading and unloading.” Heathrow’s plans for a third


runway have though proved to be a political hot potato. However, the airport pledged “to go further than any other large- scale UK infrastructure project in compensating for its impact


on surrounding communities.” It added that its expansion plan would create over 100,000 new jobs in the Heathrow area and further afield. The Freight Transport


Association welcomed the plan for the extra cargo capacity, describing it as “good news for freight”. FTA recently commissioned


the Sky High Value report which detailed the importance of air freight to the UK economy and why continued investment in airport capacity is essential for UK importers and exporters. FTA’s director of Global and


European Policy, Chris Welsh, said: “The plans outlined by Heathrow today are very much welcomed by FTA and echo the findings in our own recent report.


We have previously


stated that it is imperative that the UK has a single air freight hub, and that Heathrow fulfils that role.


It is an essential hub


of connectivity for passengers and freight, bringing together huge resource, expertise and opportunity in one place.” He added: “Heathrow is the


UK’s main airport hub, but is currently operating at 98% capacity and needs to be able to expand to meet the needs of


industry. It is a critical


hub for air cargo, offering 191 destinations; it moves 1.5 million tonnes of freight and is vital for UK connectivity to its main overseas markets.”


///NEWS


Where’s the freight in the airport debate?


The Davies Airports Commission is considering the UK’s urgent lack of airport capacity only from the passenger perspective, Freight Transport Association director of global and European policy Chris Welsh, told a seminar at the Multimodal show on 1 May. Cargo’s interests were getting


“swamped” in what was turning into a highly politicised debate, Welsh said. Few companies were prepared to put their heads above the parapet and comment


on the issue, fearing they would be accused of being anti- environment. In a report to the Commission,


the FTA emphasises London Heathrow’s crucial hub role – “a fact not recognised by Davies,” Welsh said. “Heathrow needs major investment or, if a new airport is to be built, it should be something comparable.


It’s


not an option to disperse [cargo] all round the country, although we don’t have a problem with


regional airports growing.” Heathrow has almost 200


scheduled services, and more than 95% of cargo moves through the airport in the bellies of passenger aircraſt. “Few outside the


close correlation,” Welsh


industry understand this said.


Yet it is nearing saturation point, which is concerning customers in the life sciences industry, the express sector and movers of aircraſt spare parts among many others.


Austin is really motoring, says BA


British Airways’ new route to Austin, Texas has eased severe bottlenecks in the US Gulf, speeding up shipments and reduced the need for trucking to other airports in the region, both in Texas and elsewhere said the carrier at a recent press conference. “We had gridlock from existing


Texan customers,” points out Joe LeBeau, head of North America for IAG, the International Airlines Group which comprises British Airways, Spain’s Iberia Airlines and Vueling Airlines. “Houston and Dallas were full much of the time. We were trucking a lot of Texan cargo into Orlando, Tampa, even Washington. The Austin route, which utilises the B787 ‘Dreamliner’, is now 90-95% full in both directions, averaging 13-14,000 kilos per night. The Dreamliner is a good aircraſt for cargo; it can carry up to 20,000 kilos per night.” The


new service, which


began in March flying five times per week but which has already increased to a daily liſt, is unusual in that volumes are balanced in each direction. The region’s biggest industries are pharmaceuticals, oil and gas, high tech and automotive, but exports include significant quantities of Latin American perishables, especially those from Mexico. Imports include “anything


needed by a growing first world economy” - aviation and oil field equipment and spare parts account for 33%, with components for the ‘Silicon


Hills’ high tech sector taking another 10% and pharmaceutical materials 5%. However, salmon from Norway and Scotland, chocolate, flowers, automotive equipment and machine parts are all carried. “Cargo is not just going to or


coming from the UK, either,” adds LeBeau. “Shippers are using London as a transit point between Austin and Germany,


France,


central and southern Europe, the Middle East and South Africa. We have arrangements with partner carriers, such as Qatar, to link cargo services into and out of Austin.” To


serve the growing


pharmaceutical market, IAG has developed a ClimateCare warehouse, which is due to be accredited for the handling of pharmaceutical products within two or three months. Currently, pharma products have to move through Houston or Dallas. A perishable centre for refrigerated produce


is already handling


traffic from Latin America. North America is the strongest


region for IAG. Over 45 flights per day serve 20 US gateways; 800,000 kilos of cargo are carried per night on North American


routes. “We have more direct flights


to and from North America than any other carrier,” says Le Beau. “ClimateCare exports have doubled in the past five years and Prioritised shipments (express cargo) tripled.” The continual growth in


demand for capacity stems from the ‘globalisation’ of Austin, Forbes’ fastest growing US city for the fourth year in a row. Houston, San Antonio and Dallas are all within the top ten, indicating even further growth in the region is likely. Austin’s young, educated, entrepreneurial population is fuelling that growth, as the city becomes known for its dynamic workforce. Austin, San Antonio, Houston,


and Dallas - linked by the I-35 highway and together known as the Texas Triangle - contain 80% of the state’s population and 15,200 manufacturing firms. Dell, IBM, Intel, 3M, Charles Schwab, National Instruments, Samsung, Apple, Wholefoods, Sears and Flextronics all have a presence in the city. Texas tops the list of US state exports, worth US$279.7bn in 2013; Austin was the ninth biggest exporting city last year.


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