Brussels Cargo revival
11 / 08 / 2015
IN the five years after DHL moved its main European hub from Brussels to Leipzig in 2005, the Belgian airport was in "a negative spin" according to its current head of cargo, Steven Polmans. "We had no answer, no strategy. We didn’t have the right people in place.
"But things have certainly changed since, and now Brussels seems to be on a roll. In the first five months of 2015 it saw an 8.4% rise to 202,000 tonnes. That compares to a fall of 2.1% at Frankfurt in the same period, a drop of 4.2% in the first four months in Paris, and a fall of 2.5% in the first four months in Amsterdam. In 2014, Brussels’ throughput was up 5.6% to 453,954 tonnes.
The key reason has been a flood of new freighter operations, including a Qatar Airways Airbus 330F that started three times weekly in October and which has now risen to six times; a four times a week Boeing 777F service from Ethiopian Airlines that started in January; four weekly Boeing 747Fs from Yangtze River Express launched in March; and four weekly DC-10-30Fs from Toronto operated by KG Cargo (formerly Kelowna Flightcraft) since May.
"We are also talking to a few other freighter operators and I sincerely hope we will get one or two new ones later this year," says Polmans. "And we are talking to two existing customers about a serious increase in flights.
"Longer standing all-cargo operators at the airport include Saudia (four times a week), Singapore Airlines (five times), Asiana (four times) and Royal Air Maroc (six times). Oh, and DHL never entirely left: they carried on using Brussels as a sub-hub and recently signed an agreement to build a new 120,000 sq m sort facility at the airport.
"After the move, for a few years activity was really low, but then they realised that the Benelux was important and not so easy to serve from Leipzig," says Polmans. "They now have connections to most parts of Europe and longhaul flights to Cincinnati, Lagos, Dakar and Hong Kong.
"All this success is even more surprising because Brussels is not without competition. Liège, Luxembourg, Cologne and even Hahn are a relatively short drive away in an area bounded by Amsterdam, Frankfurt and Paris.
Some of the new business was won from these rivals — Ethiopian moved some flights from Liège to Brussels to pick up export traffic to Asia, for example, while Yangtze switched from Hahn to a Brussels-Munich combination.
Polmans and his team in fact learned from two of those rivals. One lesson was that it was important to have a dedicated cargo team.
"Before 2010, cargo was split between different areas," he says. "There was one guy in aviation marketing, trying to do sales for cargo, and cargo was also part of real estate and other airport activities.
"When a forwarder came to the airport looking to build or expand a warehouse, there was no one place to approach.
"He admits that, to begin with, it was a battle to prove to the airport bosses that this would generate value.
"Cargo is not obviously a big money maker for airports, but we learned that not having dedicated cargo people would lose us much more money. For example, some passenger routes are not profitable without cargo.
"And if you stop cargo completely, how much do you save? The answer is not much at all, because many airport functions used by cargo still have to carry on and be funded. So as an on-top business, cargo is very profitable.
"The team did a competitive analysis of their strengths compared to other regional airports and concluded that offering a more intimate service to carriers would pay dividends — "making them feel like the home carrier", as Polmans puts it. But another key realisation was that building the cargo business also required attention to the wider supply chain.
Here quality is as important as quantity. Polmans says that lots of smaller forwarders left Brussels between 2005 and 2010, but since 2011 the big names such as Kuehne+Nagel, Panalpina and DHL Global Forwarding have been expanding. "I would rather have five big forwarders than fifty smaller ones," he says.
The airport also decided to get serious about one of the key air cargo businesses — pharmaceuticals.
In 2014, it became the first airport community to get IATA CEIV certification (Centre of Excellence for Independent Validators) for pharmaceutical handling.It was the airport that approached IATA to see if such a standard could be developed, building on the experience it had had with CEIV certification for the ACC3 European security standard.
It wanted two things — a standard that would be global and not just specific to Brussels, and for it to be available to truckers and forwarders as well as airlines and handlers. Pharmaceutical shippers were also consulted about their requirements.
The result is a programme launched in May 2014 and with the first company audited in December. The airport provides centralised training and administration but it is individual companies on the airport that get certified.
The programme takes into account the World Health Organisation’s Good Distribution Practices (GDP), but also covers logistics processes such as trucking, which GDP does not.
Nine companies have now completed audits, with two more to come shortly, and a second wave of nine has started the audit process. So by the end of the year Polmans expects to have twenty companies certified.
Whether this has directly led to more carriers coming to Brussels is hard to say, but Polmans insists that the participants have already seen positive results.
"They report that they are growing stronger because of it and have got business from outside Belgium as a result.
"Another initiative of the airport has been to create a cargo community platform, which has been in operation since May — an open, cloud-based IT platform and not an old-fashioned cargo community system, stresses Polmans.
He likens this to Apple App Store, a basic platform on which companies can add applications free of charge.The first one the airport is developing itself — a statistical app that will collect data on cargo moved from all companies on the airport.
"For example, at the moment we have no direct flight to Japan [though this will change later in the year when ANA starts a Boeing 787 passenger service] so we can’t see how much cargo goes there.
"But this app will tell us that and also how much, for example, we truck to Amsterdam and how much of that is perishables and how much pharmaceuticals. Up until now Amsterdam has been the only airport in the world with this level of detail: now we will be the second.
"The airport is also looking at creating an application to manage slots for pick-ups and deliveries, and another project is for an app to provide real-time pharmaceutical temperature monitoring at the airport.
Otherwise the platform is open for anyone to use, whether for an app they have developed themselves or for a third-party application. The only charge is a fee for connection to the cloud. Or the cloud company can help develop an app for a fee.
Polmans is also expecting some belly cargo growth in the coming year as home carrier Brussels Airlines expands its longhaul fleet. The carrier’s connections to Africa are a draw for specialist forwarders and that has attracted specialist freighter operators to the region such as Magma.
"These small carriers are also important to us, because they only choose one airport in Europe," says Polmans. "We can give them the support they need to grow their business."