A tale of two airports: Heathrow and Schiphol
27 / 03 / 2017
It was a tale of two cities and their airports, when the cargo chiefs of Amsterdam-Schiphol and London Heathrow took to the stage in Abu Dhabi for the IATA World Cargo Symposium.
The theme was “It takes a village”, with Jonas van Stekelenburg, head of cargo at Schiphol, seated alongside Nick Platts, head of cargo at Heathrow, with David Ambridge, general manager, Bangkok Flight Services, as moderator.
Schiphol is the third largest air cargo hub in Europe, based on 2016 volumes of 1.66m tonnes, with Heathrow a close fourth at 1.54m tonnes.
As the two cargo bosses admitted, the airports operate two very different business models and have contrasting histories.
Van Stekelenburg described how an early 20th Century Dutch government wanted a strategic airport close to the capital but built on the “cheapest” plot available, reclaimed land that even now provides Amsterdam with space to grow.
Schiphol is today regarded as an innovative hub and the Dutch Air Cargo Netherlands community, described as a “benchmark” by Platts of Heathrow, is one aspect of a healthy tripartite government-airport authority-private sector engagement that encourages processes and procedures to promote volume growth.
Heathrow, cramped and confined on a limited footprint originating in the mid-1940s, has only just won the chance to build a third runway after 50 years of government dithering.
Its post-war ‘horseshoe’ design cargo centre is much maligned and the airport owners hold only the freehold for the land and so currently cannot pull the same investment levers to influence directly the cargo estate as their Dutch rivals.
Ambridge, who worked at Heathrow in the past, said that the horseshoe “does not work”, which elicited a wry observation from Platts, a straight-talking Australian: “I’m curious why the industry has not done something about it.”
Platts, who took on the Heathrow cargo role in May 2015 and so inherited a decades-long legacy of cargo inaction at the UK’s number one hub, said of the Schiphol and Heathrow business models: “We operate in a different competitive market. The UK government does not favour one airport or seaport over another.”
Heathrow transitioned from state-ownership to private control in the 1980s and now its management has to sit down every five years with the regulator to decide what the airport can charge, what it can earn and what it can invest in passenger and cargo.
Most UK industry pundits view Heathrow’s cargo cluster as labouring under a “Cinderella complex,” enjoying very little funding over the last 30 years.
UK government departments regularly asked how air cargo works, Platts observed, and while they did not initially appreciate the value of the cargo component at Heathrow: “They do now.”
On stage, Platts went through a litany of Heathrow plus points: it handles 70% of UK air cargo, 30% of UK trade by value, 95% of the cargo is bellyhold, to and from 180 destinations worldwide.
Platts surprised some in the audience when he confirmed that Heathrow does have freighter operations, with a prospect for more, as long as cargo airlines are realistic about the time slots they seek.
He gave the example of a Boeing 747-8 freighter arriving in the afternoon and wanting a two hour turnaround.
Heathrow has used up 98% of its 480,000 annual aircraft movements, “so don’t ask me for a 7am slot,” said Platts who added that there were freight slots available: “There is capacity and we need to work to unlock that. If you want to fly in twice a week, come and talk to me.”
He does not expect a mad rush to his office, primarily because Heathrow is in the “wrong spot geographically” for freighter operators, but his door is open.
Van Stekelenburg observed from the sidelines that the UK airport and government had been “distracted” by the process for achieving third runway approval for Heathrow.
Platts, answering criticism that the Horseshoe was congested with trucks and that the airport did not have a slot-booking system, pointed out that one such system had seen a poor take-up by the cargo community.
He added however, that a new early-booking software was being tested which provides data and alerts so that ground handlers can prepare freight in advance of the vehicles arrival at the terminal.
Platts also made the interesting point that e-commerce was fuelling the number of “white vans” at the airport’s cargo area, asking “and who takes care of them?”
Schiphol’s cargo boss is clearly looking to grow his business and said that communication with the air cargo community was essential: “I want to attract business but I have to be open and transparent about what is possible. Communication and information are primary.”
Platts’ first port of call on taking the Heathrow role was to visit Schiphol and to talk with Van Stekelenburg’s predecessor and architect of the Amsterdam cargo revival, Enno Osinga.
Platts said that Heathrow is currently where Schiphol was ten years ago, before Osinga began the process of engagement with all parties, including government, in the air cargo supply chain and beyond, including local universities and industry.
Van Stekelenburg said that he was “flattered” by the comparison with Heathrow, but pointed out that the London airport enjoyed proximity to a very large city and a UK industrial base, quite different to the profile of Amsterdam and Schiphol: “We had to fight for cargo.”
He added: “The Netherlands does not have big industries, like certain German states. Yes, it is a model that works but we cannot relax and say this is going well and it will continue for ages.
In a question and answer session, Platts was asked about the decision by industrial warehouse developer Segro to pay £365m to acquire 100% control of Airport Property Partnership (APP), whose assets include the majority of Heathrow Airport’s airside cargo facilities.
Segro bought the 50% interest in the APP joint venture that it did not already own from partner Aviva Investors.
Platts said: “I think that the investment is good from an operational point of view, and that the decision-making process will be faster and easier, but I also think that it is a sign of confidence in the industry, that there is a future for air cargo at Heathrow.”
Describing Segro as a “strategic partner” Platts said the developer has brought in an operational team to look at how Heathrow can deal with growing volumes of cargo: “They recognise as well that things have to improve, and this has given us the opportunity to have a conversation about the impact of a third runway on the industry.”