Europe’s southwestern periphery is becoming a focal point for intercontinental logistics players. The Spanish capital is enjoying rapid growth in international cargo flows, which are boosting large logistics infrastructure investments. IAG Cargo and DHL have opened vastly expanded facilities at Madrid Barajas Airport this year, and another large logistics hub is taking shape not far from the airport.

In February, DHL Express opened its new hub facility at the airport, which quadrupled its capacity. The integrator spent €93 million (US$105.1 million) on the 14,500-square-metre building that is equipped with the latest technologies to be able to process 24,500 packages per hour. The hub, which has an overall footprint of 32,000 sq m, has 176 loading docks and is served by 10 daily flights operated by the integrator. In addition, it processes cargo from 30 commercial flights a day serving 20 international destinations, most of them in Latin America.

“With this latest investment in our infrastructure, we are further expanding the capabilities of our European and global network, enabling continued growth supported by a platform of quality,” declared DHL Express CEO John Pearson.

“Customers from our traditional sectors as well as e-commerce customers in both private B2C as well as businesses who are driving their own B2B growth agendas through e-commerce will benefit from the investment. With this new hub in Madrid, we are connecting sellers and consumers around the world with even greater speed and efficiency,” he continued.

The same month that DHL’s expanded hub started operations saw the opening of a pharmaceutical centre for IAG Cargo at the airport to handle temperature-sensitive life sciences products. The GDP-certified facility has two temperature-controlled chambers with a total floor area of more than 900 sq m. Transfer of shipments between the cargo terminal and aircraft is carried out with special reefer trucks.

The new building primarily serves the pharma market in Latin America, which is forecast to grow 9% a year through 2028, according to the carrier.

IAG’s Madrid hub handles over 250,000 tonnes a year. Last year the carrier saw increased volumes of avocados and mangos moving from Mexico to Spain and of flowers reaching the Spanish capital from Colombia. In the summer, it flew 100 tons of salmon a month from Chile to Madrid.

According to a report published last June by LogIndex, Madrid Barajas was the world’s fastest-growing airport on a rolling 12-month basis, showing a 15.5% rise in cargo throughput.

A new logistics hub is currently being built not far from the airport by Palm Logistics. The affiliate of pan-European real estate private equity firm Palm Capital is developing a 115,000-sq-m area in Madrid in a neighbourhood close to the airport, a large intermodal hub and major road arteries.

The first phase of this project, which is scheduled for completion this summer, consists of a 33,000-sq-m area occupied by two buildings. According to the company the hub will offer “the best last-mile delivery option to Madrid” with “world-class, well-located logistics assets for regional, national and pan-European coverage.”

While trans-Atlantic links with Latin America are a huge driver of cargo flows in and out of Spain, other international streams are also boosting the Iberian country’s cargo stature. At the end of last summer Ethiopian Airlines launched a twice-weekly freighter operation with Boeing 777F aircraft from its home base to Zaragoza, where the African carrier picks up exports for Inditex Group, which owns and operates the Zara fashion network. The freighters continue to Miami and on to Bogota, hauling flowers on the way back to Brussels before returning to Addis Ababa.

In early April, CEVA Logistics opened a surface link from Asia to the Iberian peninsula when it expanded its China-Europe trucking service to Spain. The first shipment (of garments for “a leading worldwide retailer in Spain”) covered the 13,600-km journey through Kazakhstan, Russia, Belarus, Poland, Germany and France in 16 days.

Kelvin Tang, director of road and rail, CEVA Logistics North Asia, stated that the new offering, which will run twice-weekly, is 40% lower in cost than air freight and at least 10 days faster than rail transport.

Air freight flows between China and Spain stand to gain from the expansion of the Smart and Secure Trade Lanes initiative, a bilateral programme between the European Union (EU) and China backed by the World Customs Organization (WCO) to reduce customs clearance times and improve security. This was first launched on the maritime side in 2006, but last December trials began in air cargo on flights to Amsterdam and London Heathrow. For the next phase eight more EU member states are poised to join, including Spain.

By Ian Putzger

Air Freight Correspondent | Toronto