The reduction of maindeck capacity between Asia and Europe is affecting European airports, but any opening that promises half decent loads is tempting to other carriers to boost their load factors.

 At the end of last year, Finnair bowed out of the longhaul freighter business, scrapping its MD-11F service to Hong Kong. Management cited overcapacity, sinking yields and fluctuating currencies as a toxic cocktail that undermined sustainable operations. Still, its exit did not leave its home market without Asian freighter connections for long. Barely a month later, AirBridgeCargo jumped into the breach, launching twice weekly B747F flights between the Finnish capital and its Moscow hub via Frankfurt, with connections to the carrier’s destinations in the Asia-Pacific region.

The quest for lucrative loads has prompted some airlines to direct their freighters at niche markets. Last September, AirBridge added Basel to its network with a weekly 747-8F stop in the Swiss city, chiefly to pick up pharmaceutical traffic to feed into its global network.

In January, Qatar Airways launched a new service labelled ‘Pharma Express’ for expedited moves from Brussels and Basel to its home base in Doha and beyond. The Middle Eastern carrier is using an A330-200 freighter for the new venture.

Lufthansa Cargo firmed up its focus on the oil and gas sector last year with a freighter flight linking Houston with Stavanger. Carsten Wirths, vice president for Europe and Africa, called the venture “a total success story,” adding that the operation has exceeded expectations both on the eastbound transatlantic leg and out of the Norwegian airport.

At its home base in Frankfurt, Lufthansa had to suffer the impact of a six-hour curfew between 11 pm and 5 am, which seriously affected its freighter network. Nevertheless, Frankfurt retained is crown as Europe’s premier airfreight gateway. According to statistics from the Airports Council International for the first nine months of 2014, it was the only European airport in the top 10 global air cargo hubs, coming in ninth. For the full year, Fraport tabled a total throughput of 2.16 million tonnes, up 1.7% from its tally for 2013.

Three other European airports ranked in the ACI’s top 20 list for the January-September period. Paris was number 13 in the global hierarchy, Amsterdam number 16 and London number 18. The British capital ended the full year with a total of 1.5 million tonnes, up 5.3% from the year before. Amsterdam Schiphol saw traffic grow 6.7% to 1.63 million tonnes.

By sector, Schiphol’s traffic was dominated by Asian cargo, which accounted for 38.8% of overall throughput. this sector was up 5.3% last year, outpaced by North American, intra-European and Middle Eastern traffic (although the latter includes flows from Asia to Europe).

While smaller European airports have attracted some capacity here and there, overall the major gateways have boosted their command of the market. Freighter reductions have led to greater concentration at the big hubs, above all Frankfurt. Thomas Reuter, COO for Air and Sea Logistics at German forwarder Dachser, remarked that despite the curfew, Frankfurt still exerts a powerful pull. He expects to see further concentration at the big hubs.

“We have a clear gateway focus. About 60-70 percent of our business is with 10 carriers. You cannot do that with all routing decisions decentralized,” he said.

“Typically the growth is into the main gateway markets, like Frankfurt and Amsterdam,” remarked Vito Losurdo, vice president, global airfreight services at UPS Supply Chain Solutions.

Frankfurt is not relying solely on its connectivity and the presence of forwarders with gateway operations on its doorstep. At the beginning of the year, following extensive testing, it launched a cargo community system to automate processes and data flow between the various parties involved in air cargo supply chains.

Another factor that favours the large gateways is the relatively short trucking distances to and from most European markets. However, some minnows try to utilize this for their ambitions. Hahn, which markets itself as an alternative gateway to Frankfurt, set up a road feeder service (RFS) centre for pan-European distribution at Moerfelden-Waldorf, located a mere six kilometres from Frankfurt.

Hahn established the RFS centre in the wake of Air China Cargo’s arrival on its patch. The Chinese carrier picked the airport as the European stop for a round the world freighter operation that sees some of its B777-200F flights to Chicago routed back to Asia via Europe. Nippon Cargo Airlines has adopted the same strategy, using Hahn as a transit point for some US freighter flights en route back to Japan. This brought Hahn B747-8 freighter service.

Airports that are seeing strong moves to expand are European hubs of integrated express carriers. Last year UPS completed a US$200 million expansion of its European air hub at Cologne. In February DHL announced plans to invest €114 million (US$120 million) in a new hub at Brussels that should triple its package handling capacity at the airport to 39,500 shipments per hour. 

In part these moves address the rise of e-commerce parcel traffic. For air cargo they are of less relevance. Losurdo welcomed the expansion of the UPS hub in Cologne, but UPS Supply Chain Solutions moves most of its cargo from Asia on commercial carriers to other European gateways. The express hub is primarily for express parcel traffic.

By Ian Putzger

Air Freight Correspondent | Toronto