Top 50 Cargo Airports: Growth and Improvements

HIGHER: THE BIG GET BIGGER

For the most part, however, the year-long economic upturn in 2017 was clearly evident in the latest rankings.

Among the top 10 airports, the only reshuffling of the order came for Ted Stevens Anchorage (ANC) which moved up a rank to No. 5 with a 6.7 percent rise in cargo, bumping Dubai International (DXB) down one rung from the previous year to No. 6. Also, with 2.13 million tonnes handled in 2017, Singapore Changi (SIN) rose 7.9 percent over the previous year to sneak up two ranks and claim the No. 10 spot. Changi is undergoing a capacity expansion to 5.4 million tonnes via its new cargo hub, which is now in its second phase, said Jaisey Yip, Changi’s associate general manager of cargo and logistics/air hub innovation. However, it will not be operational until the early 2030s, she said.

“For the last two years. people have been demanding higher- quality perishables, which must be flown by air,” Yip explained. “The next major sector is advanced manufacturing, so things like semiconductors will continue to grow.”

According to ACI’s latest figures for the year 2017, collected from 2,500 airports in more than 175 countries, the longtime reigning champion, Hong Kong International (HKG) topped 4.9 million tonnes of air cargo that year, which was a 9.21 percent increase from the year before. But because HKG said it also handled 108,000 tonnes of airmail in 2017, which was not counted in the ACI figures, the airport said it officially broke the 5-million-tonne barrier in 2017.

“In recent years, the boom of cross-border e-commerce, particularly in mainland China, has created enormous opportunities for express and small parcel airfreight delivery,” said an HKG spokesperson. As a CEIV-Pharma-certified hub, HKG added that pharma traffic has seen a compound annual growth rate of 12 percent over the last four years.

The next three airports held the same ranks as they did last year: No. 2, Memphis (MEM), the central hub of FedEx, saw a modest 0.33 percent increase; No. 3, Shanghai Pudong (PUD) enjoyed an impressive 11.6 percent rise; and No. 3, Incheon (ICN) had an 8.6 percent rise.

The “2 million tonnes club” also rose from 13 airports last year to 15 this year. One of the recent additions to this club was Los Angeles (LAX), which processed nearly 2.1 million tonnes of cargo in 2017 (2.2 million, if mail is included). The 8 percent rise in cargo was enough to move LAX from No. 14 to No. 13 on the Top 50 list.

“Since the 2008 recession, LAX’s cargo operations have increased at a year-over-year average of between five and six percent, which has been two percent higher than national trends,” explained Frederick Badlissi, public information officer for LAX.

At No. 11 Frankfurt (FRA), the official tally was 2.1 million tonnes for 2017, although Roland Weill, vice president of cargo sales for Fraport AG, said that a significant amount of cargo volume is trucked through FRA that is not counted by ACI. Once those amounts are factored in, Weill said the more accurate representative should be 3.6 percent of growth to 2.23 million tonnes of cargo handled.

One of the factors driving cargo growth at FRA in 2017, Weill added, was from an increase in movement of dangerous goods, which were carried by German carrier, Lufthansa, which was the first airline to use the track-and-trace technology behind IATA’s electronic dangerous goods declarations (eDGD). The airport also benefitted from the “Fair@Link” data system alerts for trucked cargo entering FRA, despite the difficulties in getting the companies to share data “over concerns about competition,” he said.

FASTER: RISING STARS

While the top 15 airports on this list handled an impressive amount of cargo in 2017, those in the lower ranks reported some eyebrow-raising totals for 2017 (see table). The title for fastest growth in the last year was No. 30, Cincinnati/Northern Kentucky International (CVG), which increased its throughput by 27.3 percent in 2017, to reach nearly 944,800 tonnes. Cincinnati obviously benefitted from becoming the primary home of the 40-freigher fleet at Amazon Air, which began operations at the new US$1.5 billion facility at CVG in April 2017.

As a further sign of the growing influence of Vietnam in global air cargo operations, Hanoi’s Noi Bai (No. 39) and Ho Chi Minh City’s Tan Son Nhat (No. 48, appearing for the first time in the Top 50) both made the list of the 10 fastest-growing air hubs, with 26 percent and 18.3 percent jumps over 2016 totals, respectively.

Istanbul’s Attatürk Airport (IST) saw 23 percent growth, pushing it to No. 26 on the list. However, its 1.1 million tonnes reported for 2017 came perilously close to its 1.2 million tonnes per year capacity. But IST’s future on this list will be in doubt for next year as the new six-runway Istanbul New Airport (ISL) is expected to open this month, with an initial cargo capacity of 2.5 million tonnes that will scale up to 5.5 million tonnes once construction of its “Cargo City” and “Ground Services Campus” are completed.

Indian cargo airports made a strong showing in 2017, with Mumbai’s Chhatrapati Shivali International (BOM) reporting more than 19 percent growth to more than 886,000 tonnes to reach No. 32, while New Delhi’s Indira Gandhi International (DEL) rose 14.3 percent to about 952,000 tonnes (No. 29).

Also, one of the fastest risers was another newcomer on the Top 50 list: China’s Hangzhou Xiaoshan International (HGH), which reported just over 555,000 tonnes handled – a 19.8 percent rise over 2016 – to place it at No. 50 on the list.

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.”

This post originally appeared on our sister site, Air Cargo World.