Airport World, Issue 2, 2021

Theme: Revenue diversification Airport report: Bermuda Special report: World’s busiest cargo airports Plus: Sustainability & 2020’s ASQ winners

New revenue streams: Time to diversify Volume 26 – Issue 2, 2021 www.aci.aero

OPINION ;OL THNHaPUL VM [OL (PYWVY[Z *V\UJPS 0U[LYUH[PVUHS

Airport World Editor Joe Bates +44 (0)1276 476582 joe@airport-world.com Design, Layout & Production Mark Draper +44 (0)208 707 2743 mark@airport-world.com Sales Directors Jonathan Lee +44 (0)208 707 2743 jonathan@airport-world.com Gary Allman +44 (0) 7854 239 426 gary@aviationmedia.aero Advertising Manager Andrew Hazell +44 (0)208 384 0206 andrewh@airport-world.com Subscriptions subscriptions@aviationmedia.aero Managing Director Jonathan Lee +44 (0)208 707 2743 jonathan@aviationmedia.aero

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Financial times Editor, Joe Bates, considers the economic impact of COVID-19 on airports and how finding new revenue streams could help some survive.

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nyone who has been in this industry for any length of time knows that survival has long been the name of the game for most of the world’s loss-making smaller airports, so the economic ramifications of the COVID-19 pandemic for them – and indeed some of biggest and previously most profitable hubs on the planet – is potentially massive.

We already have some idea of how bad 2020 was for airports thanks to the announcement of their individual financial results and ACI World data, which in terms of the bigger picture, revealed that airports lost around $125 billion in revenue last year as they handled 6.1 billion fewer passengers than expected.

Putting the $125 billion loss in perspective, ACI World’s vice president for economics, Patrick Lucas, states that it is equivalent to completely wiping out the revenues of the 95 busiest hubs in the world.

And ACI’s latest analysis shows that despite some positive signs for recovery emerging, the impact of the COVID-19 crisis on airport revenues will still be deeply felt in 2021.

In cold, hard facts, its Advisory Bulletin: The impact of COVID-19 on the airport business and path to recovery predicts that 4.7 billion fewer passengers or 47.5% less than originally expected will travel by air in 2021. If, this is the case, it will result in a year-end loss in revenue of more than $94 billion, cutting in half earlier expectations.

The gloomy picture is compounded by the Air Transport Action Group’s latest Aviation Benefits Beyond Borders report, which warns that 4.8 million direct aviation jobs may be lost due to the impact of COVID-19, including more than 55% of the staff that work on airport sites.

ACI World’s best-case scenario for aviation is that global passenger numbers could return to 45-55% of 2019’s levels by the end of 2021 and be back on track from the end of 2023.

The worst-case scenario, essentially based on a slower than hoped for vaccine roll out, is

getting back to 2019’s passenger volumes at the end of 2024 and bettering it from 2025.

In either case, airport revenues are going to suffer, and with the number of passengers travelling on business expected to further decline – ASQ survey data shows that numbers have actually been dropping for the last five years – airports are going to be under greater pressure than ever before to maximise their revenue streams.

Airport World takes a look at some of the ways that airports are already doing this today in this ‘revenue diversification’ themed issue, with initiatives ranging from Munich Airport’s decision to expand its business interests beyond Bavaria and Germany; and Malaysia Airports’ efforts to embrace the boom in e-commerce; to Houston Airport System building its own Spaceport.

We also have a feature from MXD Development Strategists president, Chris LeTourneur, who explores how mid-size airports in North America are developing their land portfolios to become even bigger economic powerhouses for their cities and regions.

Elsewhere in the issue, ACI World director general, Luis Felipe de Oliveira, reflects on the impact COVID-19 has had on aviation and plotting the road to recovery, one year on from the outbreak of the global pandemic.

Our main feature is on Bermuda’s LF Wade International Airport, where Bermuda Skyport CEO, Aaron Adderley, tells us more about the airport’s game changing new state-of-the-art terminal.

We also turn the spotlight on air cargo where we find out how the world’s busiest cargo hubs fared in 2020 and report on the future ambitions of Ted Stevens Anchorage International Airport.

A comprehensive review of ACI World’s 2020 Airport Service Quality (ASQ) customer experience champions; the latest news from ACI’s World Business Partners and our regular ‘People matters’ column closes out the editorial AW content of another action packed issue.

AIRPORT WORLD/ISSUE 2, 2021

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CONTENTS

Theme: Revenue diversification Airport report: Bermuda Special report: World’s busiest cargo airports Plus: Sustainability & 2020’s ASQ winners

New revenue streams: Time to diversify Volume 26 – Issue 2, 2021 www.aci.aero

ISSUE 2 Volume 26

In this issue 3 Opinion Editor, Joe Bates, considers the economic impact of COVID-19 on airports and how finding new revenue streams could help some survive.

9 View from the top ACI World director, general, Luis Felipe de Oliveira, reflects on the impact COVID-19 has had on aviation and plotting the road to recovery one year on from the outbreak of the global pandemic.

10 Bermuda calling With its new state-of-the-art terminal, Bermuda’s LF Wade International Airport has never been better equipped to offer passengers a unique and memorable experience, writes Joe Bates.

16 Punching beyond their reach MXD’s Chris LeTourneur explores how mid-sized regional airports are driving revenue growth through commercial and logistics development.

21 Redefining airport retail A pioneering new e-commerce initiative aims to make airport shopping in Malaysia and at Istanbul Sabiha Gökçen International Airport in Turkey easier and more convenient.

22 Going global By diversifying its portfolio to offer management, consulting and training services worldwide, Munich Airport has expanded its footprint far beyond Bavaria, writes Ivonne Kuger.

25 Out of this world Augusto Bernal tells us more about how the Houston Airport System (HAS) is driving the development of Houston Spaceport at the city’s Ellington Airport.

AIRPORT WORLD/ISSUE 2, 2021

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CONTENTS

Director General Luis Felipe de Oliveira (Montréal, Canada) Chair Martin Eurnekián (Buenos Aires, Argentina) Vice Chair Aimen Al-Hosni (Muscat, Oman) Immediate Past Chair Fredrick J Piccolo (Sarasota, USA) Treasurer Candace McGraw (Cincinnati, USA) ACI WORLD GOVERNING BOARD DIRECTORS Africa (3) Emanuel Chaves (Maputo, Mozambique) Dewananda Chellen (Plaine Magnien, Mauritius) Capt Rabiu Hamisu Yadudu (Lagos, Nigeria) Asia-Pacific (9) Aimen Al-Hosni (Muscat, Oman) Mohamed Yousif Al-Binfalah (Bahrain) Geoff Culbert (Sydney, Australia) SGK Kishore (Hyderabad, India) Fred Lam (Hong Kong) Seow Hiang Lee (Singapore) Xue Song Liu, (Beijing, China) Nitinai Sirismatthakarn (Bangkok, Thailand) Akihiko Tamura (Tokyo, Japan)

26 Leading by example Airport World gets the latest news and reaction to ACI’s 2020 Airport Service Quality (ASQ) customer experience awards.

30 Delivering the goods How did the world’s leading cargo gateways fare in 2020 and what are they expecting from the year ahead? Joe Bates reports.

36 Advantage Anchorage Eland Conway tells us more about a record breaking year for cargo at Ted Stevens Anchorage International Airport and some ambitious plans to enhance its freight handling capabilities.

38 Green pioneers Airport World reviews a handful of pioneering new sustainability initiatives and salutes Swedavia for becoming the first operator to achieve Net Zero emissions across its airport network.

40 WBP news A snapshot of the latest news from ACI’s World Business Partners.

42 People matters Terri Morrissey and Richard Plenty provide their thoughts on the type of entrepreneurial mindset that might be needed to help airports bounce back from COVID-19.

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Europe (7) Daniel Burkard (Moscow, Russia) David Ciceo (Cluj-Napoca, Romania) Elena Mayoral Corcuera (Madrid, Spain) Jost Lammers (Munich, Germany) Yiannis Paraschis (Athens, Greece) Stefan Schulte (Frankfurt, Germany) Nazareno Ventola (Bologna, Italy) Latin America & Caribbean (3) Ezequiel Barrenechea (Guayaquil, Ecuador) Martin Eurnekián (Buenos Aires, Argentina) Andrew O’Brian (Quito, Ecuador) North America (6) Lew Bleiweis (Asheville, USA) Joyce Carter (Halifax, Canda) Deborah Flint (Toronto, Canada) Joseph Lopano (Tampa, USA) Candace McGraw (Cincinnati, USA) Sam Samaddar (Kelowna, Canada) Regional Advisers to the World Governing Board (10) Diego Arrosa (Montevideo, Uruguay) Chellie Cameron (Philadelphia, USA) Arnaud Feist (Brussels, Belgium) Pascal Komla (Lomé, Togo) Bashir Ahmad Abdul Majid (Delhi, India) Hector Navarrete Muñoz (Merida, Mexico) Augustin de Romanet (Paris, France) Brian Ryks (Minneapolis-St Paul, USA) 2 Vacancies WBP Advisory Board Thomas Duffy (ADB SAFEGATE) Tunde Oyekola (El-Mansur Atelier Group) Correct as of April 2021

ACI VIEWPOINT

View from the top ACI World director, general, Luis Felipe de Oliveira, reflects on the impact COVID-19 has had on aviation and plotting the road to recovery one year on from the outbreak of the global pandemic.

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year on from the outbreak of the coronavirus pandemic, COVID-19 continues to have a huge impact on our lives and leave us dreaming of a time when we will be able to take to the skies again.

At the time of writing in March 2020, we were starting to see some signs of recovery across the world. Indeed, with over 500 million vaccine doses administered across more than 130 countries in the world’s biggest ever vaccination programme, there are signs of fresh optimism on the horizon.

Despite this, COVID-19 remains an existential crisis for airports, airlines and their commercial partners. As some countries move away from all-encompassing lockdowns and try to limit the infections with targeted and less disruptive restrictions, others have retained either partially or totally restrictive regulations pertaining to international travel, including self-quarantine on arrival.

New data published in our Advisory Bulletin: The impact of COVID-19 on the airport business and path to recovery, shows that 4.7 billion fewer passengers are forecast to travel by year end 2021 compared to the projected baseline, representing a decline of 47.5% of global passenger traffic.

This reduction in travellers is estimated to result in a loss in revenue of more than $94 billion by the end of 2021, cutting in half expectations compared to the projected baseline.

ACI World expects the recovery to happen in phases from an initial restart with limited number of passengers, through a slow build in travellers, and, finally, a return to more normal passenger volumes.

Markets with significant domestic traffic are not expected to recover to pre-COVID-19 levels before 2023 and markets with a significant share of international traffic will recover much more slowly in 2024 and 2025.

Although the situation remains tough, we remain hopeful that an upsurge in confidence in air travel provided by vaccination and safety measures should result in the number of people travelling abroad rising significantly by mid-year.

Recovery will only be possible, however, if governments can get behind aviation with policy support and assistance to pursue a co-ordinated and risk-based approach to combining testing and vaccination to promote travel when the epidemiological situation allows.

We welcomed the recent Phase III updates issued by the ICAO Council Aviation Recovery Task Force (CART) and adopted by the ICAO Council.

The guidance will provide immeasurable assistance in promoting the harmonisation of measures being introduced around the world to facilitate the restart of air travel, which will allow aviation to be a key engine driving global economic recovery.

Furthermore, digital ‘health pass’ trials, such as CommonPass, are presenting a strong case for using digital technology to deliver a globally harmonised approach for the validation and authentication of testing and vaccination.

In March, JetBlue and The Commons Project Foundation, in partnership with the government of Aruba and COVID-19-testing partners, launched the use of the CommonPass platform on flights from Boston Logan to Queen Beatrix International Airport in Aruba.

As a result, JetBlue’s passengers from Boston with the digital health pass can use a fast-track immigration lane on arrival at the island as employees can quickly establish their COVID-19 status and documents.

We are also seeing some good progress being made with several different digital health passes, such as IATA Travel pass, OK pass and many others, which will play a key role in the recovery process.

We applaud the Good Health Pass Collaborative initiative to create a blueprint for interoperable digital health pass systems that will help restore global travel and restart the global economy.

Establishing an interoperable health data trust framework to facilitate safe border reopening and cross-border travel will be key to support global recovery.

ACI is supportive of any system which will allow testing and vaccination data to be shared consistently, effectively, and in a way that protects the personal data of those that use it.

As parts of the aviation ecosystem continue to make small steps towards recovery, a co-ordinated and globally-consistent approach to vaccination and testing – coupled with interoperable methods of sharing testing and vaccination information – remains the key to a safe and secure, and health-conscious restart and recovery of our sector.

The industry is ready to restart and we are all in this together.

AW

AIRPORT WORLD/ISSUE 2, 2021

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AIRPORT REPORT: BERMUDA

Bermuda calling With its new state-of-the-art terminal, Bermuda’s LF Wade International Airport has never been better equipped to offer passengers a unique and memorable experience, writes Joe Bates.

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t may not have had that many visitors yet due to the continued impact of the global COVID-19 pandemic, but the new terminal at Bermuda’s LF Wade International Airport (BDA) has certainly impressed those lucky enough to have used it in its opening few months.

Anyone doubting the ‘wow’ factor it has added only need to look at some of the feedback from passengers and staff on its opening day.

“Really beautiful”, “Fabulous and spacious”, “Absolutely awesome” and “It looks like a world class airport” were just some of the comments given by passengers when the new $400 million terminal opened for business on December 9, 2020.

And airport operator, Bermuda Skyport, is certain that the new complex – built on a brownfield site around 150 yards away from the old terminal – will prove to be a success and introduce new levels of comfort, safety and service to passengers.

Completed on budget, on time and on spec, the new modern 288,000 square foot facility provides improved passenger processing, increased passenger capacity, greater resilience to extreme weather conditions and a host of new passenger friendly facilities such as enhanced specialty retail and F&B outlets and covered passenger jet bridges.

“It is a game changer for us in more ways than one, and we managed to complete its construction and opening during a once in a century pandemic,” comments Aaron Adderley, president of Bermuda Skyport, noting that new terminal was first mentioned in BDA’s 2008 master plan.

“It will make a huge difference to the way we operate now, and in the years to come. It was needed as the old terminal had passed its life expectancy and its location close to the shoreline meant that it was susceptible to severe weather events.”

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The latter threat is no longer an issue, confirms Adderley, due the extra resiliency built into the design of the new complex, which included locating it inland around nine feet higher than the old terminal to avoid the risk of being flooded by ocean storm surges during the hurricane season.

“We have the first new passenger terminal in Bermuda for 70 plus years, so to say that it is a milestone for the island would be somewhat of an understatement,” he reminds me.

“In addition to incorporating a sense of resiliency into the building, we wanted to create something that enhanced the overall passenger experience and provided us with a facility that is both functional and flexible in terms of its use, development and ability to accommodate future technologies.”

Wowing the senses Focusing on the customer experience side of things, he reveals that the airport adopted a “sensorial” approach to the new terminal in a bid to create something unique that would excite passengers.

“We deliberately targeted the senses,” he explains. “By that I mean we focused on the sense of taste, the sense of place, the sense of hearing and sense of smell.”

By sense of place, he admits that BDA did what a number of other airports around the world have done and replicated examples of the local culture, people, surroundings and popular attractions in its terminal building.

In this regards, Adderley notes that little bits of ‘Bermudiana’ have been incorporated into the interior design of the terminal and can be seen most clearly by the models of cahow and long-tailed birds hanging

AIRPORT REPORT: BERMUDA

from the ceiling in the Departures Hall and colourful wayfinding Bermuda kites throughout the building.

The sense of being in Bermuda is also reinforced by a number of photo exhibits throughout the terminal showcasing the island’s flora and fauna, beaches and “everyday people”.

“All help display the sense of pride we feel as Bermudans. This is who we are. This is what we look like. The images in particular are very impactful in terms of their size and vibrancy,” enthuses Adderley.

With regards to the ‘sense of taste’, Adderley believes that F&B partner SSP America – in collaboration with local restauranteur Jennifer Turini Ysseldyke and Bermudian entrepreneur Dennie O’Connor – have come up with a winning formula that ensures that diners at any of the terminal’s three restaurants are guaranteed “a very unique, exciting and vibrant food experience”.

Specifically, the terminal’s pre-security Whistle & Rum Grill with its outdoor terrace, views of the Ocean inlet, water feature and nearby putting green is designed to offer a ‘destination experience’ to both passengers and locals as well as providing a venue to host events and outdoor receptions post COVID-19.

It is complemented by the Rock & Barrel Gastro Bar (US Departures Hold Room); and The Heron & the Sea Public House (International Departures Hold Room) both of which have outdoor dining options that

Adderley believes offer a modern, more sophisticated take on BDA’s former outside patios from which generations of Bermudans waved goodbye to their friends and loved ones.

When it comes to ‘sense of smell’, Adderley notes that the airport worked with The Bermuda Perfumery to devise a scent for BDA that visitors would immediately recognise on entering the terminal building and know that their travel adventure is about to begin.

Although it hasn’t been unveiled just yet, he says that the day is close and, for now, passengers can enjoy the sight, sounds and smells of the bespoke retail offerings in BDA’s Somers Isles Trading Company and Love Bermuda shops, which include the products from about 30 different artisans ranging from locally distilled gin, bath and facial products to clothing, candles and scents.

US Pre-Clearance The terminal is also said to offer energy efficiencies, advanced security and improved US Pre-Clearance facilities for US bound passengers – a key upgrade considering that 75% to 80% of BDA’s annual visitors arrive from and depart to the United States.

Pre-Clearance, of course, allows all US bound passengers to clear US Customs and Immigration in Bermuda, instead of on arrival where longer lines often exist.

AIRPORT WORLD/ISSUE 2, 2021

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AIRPORT REPORT: BERMUDA

According to Adderley, this service, present in Bermuda for nearly 50 years, is extremely beneficial to passengers and provides the island with a competitive advantage when seeking new air services to and from the United States.

“The new Pre-Clearance facility was necessary to ensure that we continued to meet the US’s new security requirements, so we were happy to do it, despite the expense involved, because of the advantage it gives us,” he explains.

Although a UK territory, Bermuda’s close proximity to the US – it lies just 643 miles off of the North Carolina coast – means that it has very close ties to the United States. An estimated 8,500 Americans live in Bermuda, for example, and the bulk of the island’s imports and visitors come from the US. In addition, many Americans have businesses in Bermuda, which in addition to its higher end tourism appeal, is one of the world’s top re-insurance and financial services centres.

Flexibility to adopt future technologies As well as the advanced technology utilised by US Customs and Border Protection (CBP) in the US concourse at BDA, the new terminal is equipped with a range of state-of-the-art IT systems designed to make passengers’ journeys fast and efficient.

These include self-service check-in kiosks, e-gates, baggage tracking and Computed Topography (CT) X-ray screening technology at security, making BDA more than well equipped for passenger growth when global aviation begins its recovery from the pandemic.

Adderley is also confident that Bermuda Skyport’s decision to build IT flexibility into the terminal’s design means that it is well placed to take onboard the technology of tomorrow, when it comes.

“We believe that the real test of new infrastructure is ensuring that it is not only capable of accommodating the technology that exists today, but also the technology that will come about tomorrow,” he says.

“I believe our technology focus ensures that the new terminal meets this criteria, in effect, future proofing it. This makes us excited about the future and the airport’s growth outlook.”

“With the Canadian Commercial Corporation (CCC) and prime contractors, Aecon, the airport was able to find a turnkey solution, bespoke in nature, that afforded Bermuda the opportunity to do what many small airports in the world our size have found difficult to do – namely, to successfully attract private sector investment to finance a major capital redevelopment,” notes Adderley.

“Once again, Bermuda has blazed a trail in setting new standards internationally for others to follow.

“Whilst the project’s business model has proven innovative and comparable with international benchmarks, its economic impacts have proven to be widespread. Nearly 400 local businesses have been contracted since the start of the project and nearly $400 million has been invested in the local economy.

“Over half of the 1.6 million man-hours spent constructing this world class facility were by Bermuda’s own men and women. We should be proud of their quality craftmanship.”

Steve Nackan, president of Aecon Concessions – the project’s developer and financier – is as equally proud of the new terminal as Adderley.

He says: “The genesis of today’s success story lies in the deeprooted ties between Canada and Bermuda.

“Built upon the kinship of our two countries, the Canadian Commercial Corporation (CCC) and the Government of Bermuda partnered with us to develop this much needed new facility.

“CCC – supported by the extended Government of Canada family – have been a true and valued partner – and their diplomatic approach has been a hallmark of the project’s success.

“Together, we mobilised nearly $400 million of private investment – drawn to the long-term promise of Bermuda – and the opportunity to play a part in the revitalisation of Bermuda’s economy.

“And through innovative thinking – we built and proved the model for how small airports can nevertheless achieve world class outcomes.”

Interestingly, BDA’s new terminal is the second public-private partnership (PPP) initiative in Bermuda after the method was used to finance the construction of a major new hospital on the island.

Traffic and route network Build and grow Agreeing to finance the design and construction of the new terminal was pivotal to the Bermudan government’s 2017 decision to award Bermuda Skyport Corporation Limited the 30-year concession to operate and develop LF Wade International Airport.

For the special-purpose Bermudan company is wholly-owned by Canada’s Aecon Concessions, which had the financial muscle, airport experience and construction expertise to make the dream of a new terminal become reality.

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Infrastructure wise, the airport has never been better equipped for growth, and Adderley is in no doubt that passengers and BDA’s airlines will enjoy the benefits of the new terminal when COVID-19 is finally beaten, and air travel is back on the agenda.

As you might have expected, 2020 was particularly tough on BDA, which was forced to close for over three months from March 20 to July 1 due to the devastating impact of COVID-19.

The seasonality of its traffic demand didn’t help, with the darkest days of the pandemic overlapping with the start of the traditional May

AIRPORT REPORT: BERMUDA

to September peak season for tourism in Bermuda, when BDA typically handles around 20 flights a day.

As a result, BDA’s passenger numbers fell by 80% in 2020 from 2019’s 884,000 to just over 180,000, and Adderley expects 2021 to be another difficult one for LF Wade International Airport, with the most optimistic scenario seeing the gateway reach around 45% to 50% of 2019’s traffic levels before a stronger recovery from 2022 onwards following the global vaccine roll out.

The top three airlines serving BDA in terms of services and market share are American (30%), Delta (25%), and JetBlue (18%).

With the US accounting for up to 80% of all passengers, it shouldn’t be much of a surprise to learn that New York and Boston are BDA’s most popular routes, followed by London in the UK. Charlotte, Miami, Philadelphia and Atlanta are also popular destinations served from BDA along with Toronto in Canada, which is served by both Air Canada and WestJet. British Airways operates the airport’s only non-stop long-haul service to London, and Adderley is hopeful that the recent switch of the route from Gatwick to Heathrow will benefit BDA as the decision makes it much easier for international travellers from Europe and Asia to connect to Bermuda.

One of the options currently being considered by the island to boost tourism numbers is extending the traditional May to September tourism season into October, as the weather in Bermuda is still mild, and the Bermudan travel industry believes that a pent up demand to travel post pandemic will prove incentive enough to make it worth the gamble.

With only 3,000 hotel beds across the whole island though – less than at one of the big hotel resorts on the Las Vegas strip – there is a clear limit on how big Bermuda can grow as a tourist and business destination.

However, Adderley believes that there is clear room for growth once the pandemic is over because of the appeal of Bermuda and the fact that Bermudans also love to travel – traditionally taking an average of two to three trips abroad each year.

“You have to remember that although Bermuda might be paradise, it is only 22 square miles, and we tend to get rock fever if we don’t take a trip once in a while,” jokes Adderley.

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Bermuda’s large expat community is also another reason for the airport to be optimistic that air travel will be high on the agenda again soon. Indeed, the large number of Canadians working in Bermuda was the reason why WestJet launched services to Toronto, and Adderley believes that this could easily be replicated by other airlines in the future.

Prior to the pandemic, the addition of another non-stop service to Europe was high on the wish list of BDA’s route development team, and Adderley assures that it will be again when the timing is right.

He notes: “For now, we will have to settle for people connecting through London, and I am hopeful that BA’s switch to Heathrow and a new publicity campaign by the Bermuda Tourism Authority promoting how easy it now is for Europeans to get to Bermuda will boost passenger numbers.

“But, in the longer-term, we would like another non-stop service to Europe, and we hope to boost our short-haul network by growing our low-cost presence in the US and Canada.”

Next up for BDA With the airport’s passenger handling facilities now among the best in the region, BDA is set to turn its attentions to the cargo side of the business, which Adderley admits are badly in need of a revamp.

Bermuda Skyport actually agreed to refurbish BDA’s cargo facilities as part of its concession agreement, and despite today’s far from favourable economic conditions, work is expected to begin on the project later this year.

The upgrade will include an expansion to the existing Customs administration facilities and the introduction of new refrigeration capacity for perishable goods.

The bulk of the 6,000 tonnes of cargo handled at BDA each year arrives on a Cargojet B757F aircraft which operates between the US and Bermuda five days a week on behalf of DHL, UPS, FedEx and a number of local couriers.

With a brand new passenger terminal and enhanced cargo facilities on the way, nobody can deny that LF Wade International Airport is looking towards the future with optimism and will be in a great position to develop and grow when the pandemic is finally over. AW

SPECIAL REPORT: REVENUE DIVERSIFICATION

Image prepared by CallisonRTKL with input from MXD Development Strategists.

Punching beyond their reach

MXD’s Chris LeTourneur explores how mid-sized regional airports are driving revenue growth through commercial and logistics development.

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id-sized regional airports have always been critical economic engines for their adjacent regions, by facilitating passenger connectivity with larger gateway airports and business markets.

They have also had the benefit of an abundance of land beyond what is needed to serve the growth of airside operations.

The COVID-19 pandemic has further amplified the importance of revenue diversification for airports and their adjacent regions. Mid-sized regional airports are embracing this opportunity not only to be recognised as ‘passenger airports’, but also as ‘industrial-commercial airports’.

Even before the onset of COVID-19, mid-sized airports were developing some of the most entrepreneurial initiatives in commercial, industrial, logistics and innovation projects, recognising their role in stimulating economic development.

This activity is not purely dependent on air transportation, but also relies on ground connectivity, supporting the design, manufacturing and distribution of goods, as well as aviation.

Logistics, particularly for e-commerce and perishables including food and bio-products, have been driving growth trends, even before the current pandemic. This growth has accelerated in the

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wake of the coronavirus pandemic, recognising that regions served by mid-sized airports are completely dependent on the supply chain for delivering retail, health care and daily goods such as groceries, food and medications.

One of the prime examples of mid-sized airport economic positioning is Memphis International Airport (MEM). The merger of Delta Airlines with Northwest Airlines in 2008 and consequent dehubbing of MEM saw air passenger traffic drop dramatically.

As a result, MEM, the City of Memphis and Shelby County recognised that with the FedEx World Hub anchor and adjacent UPS facilities, MEM’s role as a facilitator of logistics and related economic development was as equally important as serving passenger traffic.

The result has been the clustering of one of North America’s strongest multi-modal logistics hubs, as well as a concentration of time-sensitive bio-life science and medical device manufacturing and distribution businesses including Medtronic, McKesson and Smith & Nephew, who rely on this logistics network.

Factors driving mid-sized regional airport development include: • Mid-sized airports have residual lands and labour to facilitate development and industry.

SPECIAL REPORT: REVENUE DIVERSIFICATION • Progressive mid-sized airports have established partnerships with private sector developers and multiple levels of government to facilitate development.

• Even before the COVID-19 pandemic, mid-sized airports were embracing logistics, innovation and advanced manufacturing as key components of their airport master plans.

• COVID-19 has accelerated the demand for logistics facilities particularly for accommodating e-commerce, perishables and health care/bio-life sciences items.

• Mid-sized airports have the ability to be agile in responding to disruptions and opportunities.

The following profiles illustrate how mid-sized regional airports and their partners are embracing these trends.

Regina International Airport (YQR): Implementing strategic development Regina International Airport (YQR), operated by the Regina Airport Authority (RAA) and situated in the Canadian province of Saskatchewan, established an Airport Commercial Development Strategy long before the onset of the coronavirus pandemic.

This strategy started with investments to create an Airside Business Park to facilitate next generation typologies for airside businesses, including the new 32,000 square foot Kreos FBO facility on a four acre plot of land.

Sitting at the western edge of the city, halfway between downtown Regina and the Global Transportation Hub (GTH) to the west, YQR has embraced market opportunities for commercial, light industrial and logistics development.

Initiatives include the creation of the 90-acre YQR Airport Business Park to flexibly accommodate aviation, as well as cargo, distribution and manufacturing end-users, with many lots serviced and shovelready. It has attracted Canada Post as an anchor, occupying 50,000 square foot on seven acres in a state-of-the-art distribution complex to facilitate the rapid growth of e-commerce fulfilment.

John Aston, YQR’s vice president of commercial, projects and planning, reports that despite the challenges presented by the COVID-19 pandemic, YQR’s Development Strategy has attracted interest and offers to lease for development.

He notes that “YQR requires purpose-built cargo infrastructure on both the airside and landside, which is a challenge for mid-sized airports and requires innovative partnership approaches with all levels of government, as well as private sector investors and developers”.

Aston adds that as part of overall improvements to the terminal access roads and facilities, YQR has identified a 35-acre Gateway Commercial Development opportunity that will serve adjacent communities and passengers, while providing amenity for airport and YQR Airport Business Park employees.

These roads and capital works are scheduled for 2022. The gateway has already attracted interest from a fuelling and convenience store tenant and electric vehicle (EV) charging tenant.

Plans are also underway to attract private sector partners to develop a food and beverage cluster in conjunction with an airport hotel.

Aston says: “YQR is actively seeking collaborative partnerships with developers interested in land leases and capital investment required for infrastructure to develop airport land.”

In addition, RAA is working together with the City’s Economic Development Regina (EDR) office and the Provincial Trade & Export

Development office to improve the flow of exports, facilitate connectivity and enhance value added activities, with an eye on capturing air cargo shipments at YQR. As part of this collaboration, RAA is evolving a Servicing Agreement with the City of Regina to accelerate enabling infrastructure that will unlock development opportunities, attract businesses and enhance the airport’s connectivity.

Aston warns that “encroaching residential development” could limit YQR’s growth and believes that as a result, “policies to protect airport economic activity such as an ‘Airport Employment Growth District’ should be explored”.

Rice Group: Developing airport logistics projects Michael Rice, president and CEO of the Toronto-based Rice Group believes that “business partnerships are the key to success for logistics projects at mid-size regional airports”.

The Rice Group is an A to Z Design-Build-Operate firm involved in developing commercial and industrial projects, including cargo, logistics and MRO facilities at airports across Canada. These airports include Toronto Pearson, Hamilton, Halifax Stanfield, Abbotsford, Red Deer and Winnipeg Richardson.

Rice reports that his company works with the TD Asset Greystone Infrastructure Fund providing the opportunity to partner with airports to make strategic investments in airside and landside infrastructure that unlocks development opportunities.

Using its vertically integrated approach, Rice Group has developed projects on airport leased lands, as well as adjacent privately-owned lands. It has assisted its airport partners with consolidation of leases and redevelopment of obsolete cargo facilities to develop state-of-theart logistics complexes that address end user requirements.

Rice notes that the Rice Group first became involved with airports at Toronto Pearson (YYZ), where they partnered with the Greater Toronto Airports Authority (GTAA) in the operation of the International Centre, a multi-purpose convention and event facility in Mississauga adjacent to YYZ. To facilitate airport growth and generate long-term rental income for Rice Group, this property was added into the airport whereby the Rice Group became the land lease holder. His company also used this approach to develop the Skyservice Hangar facility at YYZ. Rice explains: “After our experience at Pearson with the GTAA, we realised there are many development opportunities at airports, and this opportunity lies in delivering the types of buildings that logistics and aviation businesses are looking for today rather than those from 30 plus years ago.”

Rice Group recently used this approach to partner with Winnipeg Airports Authority (WAA) to acquire leases for some of the aging cargo facilities at Winnipeg Richardson International Airport (YWG). The intensions are to redevelop selective footprints that will help unlock the region’s potential.

Rice Group worked with WAA to establish a strategic partnership whereby it invested capital to be used for the rationalisation of new cargo facilities that will enable necessary improvements towards facilitating the more efficient transfer of goods.

Notable cargo integrators that occupy space within these selective footprints include Purolator, FedEx, UPS, Calm Air, Air Canada and Cargojet Airlines.

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SPECIAL REPORT: REVENUE DIVERSIFICATION

The resulting 350,000 square feet of improved infrastructure is spread over 37 acres of land and will be built using the capital means and collective experience of the partnership.

“Rice Group has been a welcome partner as we unlock the potential of Winnipeg Richardson International Airport,” says Barry Rempel, president and CEO of WAA. “Its expertise and insights are contributing to the development of airport real estate which delivers on our commitment to lead transportation innovation and growth for the community.”

AFCO and Richmond International Airport (RIC): Facilitating logistics Aviation Facilities Company (AFCO) is a Real Estate Investment Trust (REIT) that invests in airport real estate and infrastructure. Its facilities at airports in North America and across the globe create value for airports and end-users through the development of vacant lands and investing in existing facilities.

AFCO activities are undertaken through long-term land leases and high levels of collaboration with all stakeholders. Executive vice president and chief investment officer, Steve Forrer, explains: “Our business of delivering facilities that efficiently meet end-user needs and requirements, allow airports to attract new business and generate additional revenue, which we don’t see changing in the post-pandemic marketplace.”

Its portfolio includes Richmond International Airport (RIC) in the US, which actively seeks to generate revenues from vacant lands and increase cargo activity to complement passenger-based revenues.

AFCO’s conversations with Amazon Air in late 2019 identified the need for a 41,000 square foot facility at this Virginia gateway with a timeframe that could not be accommodated by new development.

In response, AFCO created space in its existing 51,000 square foot RIC facility by relocating tenants to other facilities that included available airport properties which AFCO leased from RIC. Importantly, RIC also undertook related capital projects and made aircraft parking available to support Amazon Air. “With e-commerce demand hitting new peaks, Richmond International Airport was pleased to fast track several facility

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enhancements working closely with Amazon Air and AFCO to initiate operations on schedule,” enthused Perry Miller, president and CEO of the Capital Region Airport Commission.

Urban Land Institute Airport Development Council Symbolic of the increasing role of strategic development at airports, in January 2021, the Urban Land Institute (ULI) based in Washington DC approved the creation of the Airport Development Council (ADC) as part of its Product Council Program, which advocates best practices in real estate planning and development.

The ADC comprises members from airports of all sizes, the public sector, economic development agencies, consulting professionals, investors, developers and industries including aviation and logistics.

The ADC, which is chaired by Steve Forrer of AFCO and myself, has the mission of bridging the gap between the airport operating world and commercial-industrial real estate sectors to facilitate best practices in airport development.

Outlook Mid-sized regional airports are clearly on the rise with much of their growth attributed to the strategic planning and development of their properties, unlocking their roles as economic engines.

Working together with their partners, progressive mid-sized airports have diversified and grown non-aeronautical revenues while becoming resilient to passenger traffic disruptions.

They are agile in responding to end-user business needs, particularly for developing next generation logistics facilities. The rapid growth of e-commerce fulfilment has been a phenomenal catalyst to advance the role of mid-sized airports in the movement of goods by air and ground.

Indeed, mid-sized regional airports are well-positioned to grow their revenues by embracing strategic land development.

AW

About the author Chris LeTourneur is president and CEO of MXD Development Strategists.

SPECIAL REPORT: REVENUE DIVERSIFICATION

Redefining airport retail A pioneering new e-commerce initiative aims to make airport shopping in Malaysia and at Istanbul Sabiha Gökçen International Airport in Turkey easier and more convenient.

M

alaysia Airports is one of the world’s largest airport operators in terms of passenger numbers, handling more than 141.2 million across its network of 39 Malaysian airports and Istanbul Sabiha Gökçen International Airport (SAW) in Turkey in 2019.

Kuala Lumpur International Airport (KUL) handled 62.3 million passengers on its own in 2019 and Malaysia’s next biggest gateways – Kota Kinabalu, Penang, Kuching and Langkawi – all recorded all-time high traffic figures that year as did SAW, which welcomed 35.4 million passengers.

Such significant numbers means that Malaysia Airports can never rest on its laurels and constantly strives to find ways of doing things better to be more operationally efficient and enhance the airport experience of passengers, in line with the commitment to “hosting joyful connections” for those passing through its airports.

The current COVID-19 enforced downturn in traffic has done little to change this philosophy. In fact, it has made Malaysia Airports even more determined to adapt the way it operates to meet changing customer demands, and this now extends to expanding its retail offerings beyond the traditional airport environment.

In line with this aspiration, the company launched shopMYairports, the first travel-retail e-commerce platform in Malaysia and shop@saw, the e-commerce platform of Istanbul Sabiha Gökçen. shopMYairports and shop@saw are part of Malaysia Airports’ company-wide digitalisation initiative to embrace digital transformation. As part of this initiative, the company strives to redefine the airport retail experience by providing a unique avenue for customers to purchase travel-exclusive and duty-absorbed products from the comfort of their homes.

At the same time, both platforms align retail plans with current and future e-commerce trends as well as establishing Malaysia Airports’ reputation as a retail hub for the next generation of tech-savvy customers.

According to eMarketer (https://www.emarketer.com/content/ global-ecommerce-update-2021), purchasing behaviours have shifted online, with global retail e-commerce sales growing by 27.6% in 2020.

In Malaysia, GlobalData analytics predicts that the growth of the

e-commerce market is on a steady rise with a projected reach of RM51.6 billion ($12.6 billion) by 2024.

On top of that, mind-set research suggests that 82% of Asia-Pacific travellers will change their shopping habits when they travel in the future, making the digitalisation of airport retail more important than ever.

The significant growth of the e-commerce sector has certainly accelerated Malaysia Airports’ plan towards digitalisation whilst expanding its commercial reach.

Digitalisation is also crucial in assisting airport retail partners to adapt during a global crisis. For Malaysia Airports, the wellbeing of its retail partners remains a top priority and it believes that shopMYairports and shop@saw has successfully provided them with an additional sales avenue and expanded their market beyond the airports’ brick and mortar set-up.

Malaysia Airports’ long-term digitalisation initiative is aimed at facilitating the growth of its airport retail partners and laying the foundation to transform its airports into shopping and lifestyle destinations as well as transportation hubs in line with the group’s commercial reset strategy.

Moving forward, Malaysia Airports has big plans to expand the services of shopMYairports and shop@saw to include on-ground delivery and pick-up services at the airports.

In the next phase, when travel restrictions are relaxed and international borders re-open, customers can order products on the platform and have them collected at the airport or delivered to their departure gate or flight seats.

Furthermore, shopMYairports will include international delivery to cater to international customers looking to experience airport retail in Malaysia, which includes products that showcase the best of Malaysia to the world.

As Malaysia’s main airport operator, Malaysia Airports strives to remain agile and relevant while navigating within a fast-changing consumer landscape.

It believes that digitalisation will redefine the airport retail experience and provide the company with significant growth potential that will help ensure sustainable business operations for Malaysia Airports. In this regard, shopMYairports and shop@saw are leading AW the way in making its airports future-ready.

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Going global

Sofia Airport in Bulgaria. ©Angel Aleksandrov.

By diversifying its portfolio to offer management, consulting and training services worldwide, Munich Airport has expanded its footprint far beyond Bavaria, writes Ivonne Kuger.

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he past year will surely go down as the worst in the history of commercial aviation, and with global passenger traffic struggling to recover from the coronavirus pandemic and revenues down like never before, the financial challenges currently facing the world’s airports are huge.

Quite rightly, the priorities for most airports at the moment are firmly focused on reducing their overheads and making sure that they are COVID-19 compliant to ensure the health and wellbeing of returning passengers and staff.

However, with no clear end in site to the ongoing travel restrictions and the pandemic possibly having a long-lasting effect on the way people work, travel and do business, it could be argued that the case for airports to diversify their business activities to boost the bottom line has never been more important.

Fortunately, Munich Airport, through wholly owned subsidiary Munich Airport International (MAI), has been able to do this over the last year through the successful completion of a number of international projects that have further expanded its global footprint.

Why venture outside its own 5-star campus?

Apart from the obvious benefit of tapping into additional revenue streams independent from traffic development at Munich, the international business brings many other advantages for the Munich Airport Group as well as for MAI’s clients across the globe.

Coming from a 5-star airport with an integrated business model, MAI understands the current and future challenges faced by the industry and knows how to turn them into opportunities.

Indeed, by sharing best practice solutions and expertise across all areas of airport operations, Munich Airport actively supports the growth of the global aviation market, contributes to the improvement of global air traffic standards and works towards a greener industry by introducing higher environmental standards at other airports.

On the other hand, new experiences and knowledge is gained with each project abroad, which in turn supports MAI in expanding

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even further. All in all, it is a win-win situation for everyone – stakeholders, airports, employees and locals.

Trusted partner for smart money and ambitious airports As an integral part of a very dynamic ecosystem, airports have to be able to embrace change and transform their business models in light of new trends and regulations, next generation aircraft, advanced technologies, demographic change and fluctuating demand.

“Airports must find new answers to a variety of challenges such as the digitalisation of airport processes, commercialising airport assets and becoming more environmentally friendly,” explains MAI’s managing director, Dr Ralf Gaffal.

“At Munich Airport, for example, the declared aim is to become CO2 neutral by 2030 at the latest and moreover reach net zero by 2050.”

Over the past 30 years, MAI has evolved from being a leading operational readiness and airport transfer (ORAT) service provider to a global airport operator with a broad experience in working with investors on public-private partnership projects.

Today, it provides best practice solutions for the entire airport lifecycle and has a proven track record of more than 110 successfully delivered projects across more than 40 countries. This also includes long-term management commitments and the corresponding transition services.

Transition services: the art of handing over the reins MAI’s transition services ensure a smooth changing of the guard between two airport operators, be they public entities or private investors.

A well-structured transition programme starts with operations, maintenance and commercial due diligence, and lays out a detailed plan for handover of the operations and management responsibility.

MAI has successfully performed various transitions over the past years, the latest being at Toncontín International Airport in Honduras;

SPECIAL REPORT: REVENUE DIVERSIFICATION

Newark Liberty’s new Terminal One. Image courtesy of the PANYNJ.

Terminal A at Newark Liberty International Airport in USA; and several airports in India.

Furthermore, MAI is currently involved in the change of management at Sofia Airport in Bulgaria and took over responsibility for operating it together with concessionaire, SOF Connect, on April 19, 2021.

Starting later this year, MAI will also manage the transition for the Cargo Terminal at El Salvador International Airport in El Salvador in Central America.

When taking a deeper look into the aforesaid transitions, it becomes clear that it really is a 360-degree approach, covering all five key aspects of an airport lifecycle.

as possible. With close to 40 successfully completed ORATs, MAI is aware of all the pitfalls and will work together closely with all involved stakeholders to ensure a smooth transfer once the new facilities are finished.

4. Airport operations – ensuring efficient and sustainable operations

Before jumping into action, a clear vision and operational model has to not only be developed, but also be internalised by staff, business partners and airport stakeholders. It is important that everyone is on the same page and understands where the airport is heading.

As a global airport operator, MAI focuses on implementing best practice solutions in order to increase the efficiency and productivity of all operations.

This includes strengthening digitalisation with innovative IT solutions, for example, as well as adopting the latest safety and security standards, and of course implementing the highest possible hygiene standards to make customers feel comfortable when travelling – despite the ongoing pandemic.

In addition, transparent communication at all levels as well as enhancement programmes for employees are crucial for a favourable work environment.

2. Planning and development – making airports fit for the future

5. Commercial growth – optimising aviation and non-aviation revenues

With the defined vision in mind, an analysis of the existing environment and facilities helps to identify the areas in need of optimisation and adjustment. Quick wins for improved passenger experience and increased efficiency in operations are just as important as long-term enhancement measures.

When looking at present transitions, tasks such as re-engineering of the present installations, updating the information communication technology (ICT) masterplan and the development of new facilities are a top priority.

An airport should always try to reflect its roots and offer a suitable choice of retail and F&B opportunities the highlight the local culture.

Also, the flight network has to be selected wisely, to contribute to the overall success.

At Cairo Airport, for example, MAI developed tailored strategies to increase commercial revenue and the customer satisfaction in the new Terminal 2 by analysing the passenger’s needs and joining forces with local business partners.

“A change of leadership holds many challenges,” says Lorenzo Di Loreto, MAI’s vice president for business development and service delivery. “It involves multiple interfaces from state authorities all the way to the airport’s employees.

“Only with the necessary sensitiveness, professionalism and structured approach can a smooth transition be guaranteed. We are proud to be part of various airports’ next chapters and look forward to working together closely with our investment partners worldwide, AW different states, and overall society.”

1. Airport business excellence – shaping state-of-theart concepts

3. ORAT – getting ready for take-off The improvement of existing facilities, and the development of new ones, always come with the challenge of a smooth upkeeping and transfer of operations. Work in progress should never negatively affect the airport experience; be it for passengers, employees or stakeholders.

Processes have to be adopted, infrastructure has to be tested and staff have to be familiarised with the new working environment as early

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Out of this world

Augusto Bernal tells us more about how the Houston Airport System (HAS) is driving the development of Houston Spaceport at the city’s Ellington Airport.

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hile much of the aerospace news coming out of Texas recently focused on Elon Musk’s expansion of SpaceX at the southern tip of the state, more than 350 miles to the north east, there’s a vibrant aerospace hub that’s quickly making gains. Houston Spaceport is becoming a serious player in the evolution of space flight.

Today, Houston is home to over 500 space, aviation and aerospace related firms and institutions. It also boasts of having the first urban commercial spaceport in the world – the Houston Spaceport.

Not only will it serve as a future launch site for suborbital hypersonic point-to-point operations, but it seeks to develop a hub of aerospace innovation that will lead the nation in the transition from a governmentdriven space programme to one driven by commercial interests.

That vision is slowly coming to fruition, notably with the recent announcement by Axiom Space to build its headquarter campus at Houston Spaceport. It will use it to train private astronauts and begin production of its Axiom Station, the commercial space station that will replace the International Space Station in low Earth orbit.

There are other exciting projects happening at the spaceport, such as the work performed by Intuitive Machines, the first tenant at Houston Spaceport. The company is building the NOVA-C Spacecraft, a nearly 13-foot lunar lander, which in 2019, NASA selected to deliver cargo to the moon as soon as the fall of 2021.

“We have a unique aerospace centre for collaboration and innovation,” said Arturo Machuca, director of Ellington Airport and Houston Spaceport. “We have several projects in the pipeline that we believe will be making announcements soon.”

Horizontal launches and landings will one day happen at Houston Spaceport. It is already equipped with a state-of-the-art Air Traffic Control Tower that has dedicated mission-control facilities for commercial spaceflight operations.

Additionally, its tenants have access to Ellington’s two world-class runways. The planning of the new Taxiway Lima is underway, which will increase access and operational space for tenants and partners.

In late 2020, the nation’s 10th licensed commercial spaceport completed Phase 1 of its development at Ellington Airport, located just 15 minutes away from downtown Houston.

The 150-acre, $21 million build-out included streets, water, wastewater, electricity, fibre optics and communications.

The Houston Spaceport’s Houston Aerospace Support Center already offers more than 53,000 square feet of manufacturing, laboratory and office space, including cleanrooms and large-scale hardware production facilities.

With the infrastructure in place, a significant number of aerospace companies already in the area, and one of the world’s largest international travel infrastructures, Machuca and his team at Houston Airport System (HAS) – which operates Houston Spaceport – envisage a cluster of spaceflight innovation that will grow and diversify Houston’s aerospace ecosystem.

The long-term vision of commercial aerospace leadership and the significant breakthroughs at Houston Spaceport would have been impossible, says Machuca, without the close relationship they have built with the higher education institutions around Houston.

Most notably he mentioned the opening of San Jacinto College’s EDGE Training Center at Houston Spaceport. The centre will train and develop aerospace workers, and share best practices with the spaceport’s tenants.

With the support of other Tier 1 universities such as Rice University and the talent pool of the most diverse city in the US, Houston Spaceport will continue on its journey of innovation and advancement in the unique urban environment of Southeast Texas.

As the future becomes clear for the Houston Spaceport and its pioneering role in commercial space flight, the nation is reminded that, from the beginning of manned spaceflight to sustaining an Earth-orbiting human presence and exploring the Moon and Mars, AW Houston remains Space City.

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CUSTOMER SERVICE

Leading by example Airport World gets the latest news and reaction to ACI’s 2020 Airport Service Quality (ASQ) customer experience awards.

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t might have been easy for the world’s airports to let their usual high customer service standards drop in 2020 as the coronavirus pandemic significantly reduced their passenger numbers, but ACI’s Airport Service Quality (ASQ) survey proved otherwise with 89 gateways winning a total of 108 awards.

The winners included 33 airports that picked up new ‘hygiene’ awards in the ASQ programme, which was modified in 2020 to take into account the impact of COVID-19 on aviation.

ACI believes that the new Best Hygiene Measures by Region category provides airports with a reliable method of gauging the response to the new health measures introduced across the world and recognises their success in responding to the intense focus on hygiene.

The new category also complements ACI’s Airport Health Accreditation programme, launched last year, which has resulted in close to 300 airports being accredited already.

“ACI’s Airport Service Quality awards represent the highest possible accolade for airport operators around the world,” enthused ACI World director general, Luis Felipe de Oliveira.

“This year more than any other, the awards recognise those airports that have listened to their customers and adapted the services and experiences they offer to meet changing needs and expectations under very trying circumstances.”

The impact of the pandemic effectively meant that 2020’s ASQ awards were restricted to Best by Size and Region and Best Hygiene Measures by Region categories for Africa, Asia-Pacific, Europe, Latin America-Caribbean, the Middle East and North America.

Europe Europe’s Best by Size champions ranged from four small gateways sharing the honours in the Under 2mppa category (Granada, Inverness,

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Ponta Delgada and San Sebastian) to Moscow Sheremetyevo and Rome Fiumicino jointly claiming the Over 40mppa award.

Other airports to scoop awards in 2020 included Helsinki, Prague and St Petersburg-Pulkovo for airports handling 15-25mppa; and Lisbon, Moscow Domodedovo and Zurich in the 25-40mppa category.

A total of 15 airports, including some of the above, were also inaugural winners of Best Hygiene Measures by Region awards.

Helsinki Airport director, Ulla Lettijeff, said: “Smooth processes, high-quality services and a customer experience that exceeds expectations are the goals we work for every day at Helsinki Airport.

“It is an honour to receive recognition for this work and be rated the best European airport in our size category. I am particularly proud of the recognition for our hygiene measures, because health security has been a top priority for us.”

While Prague Airport’s Vaclav Rehor, chairman of its board of directors, noted: “For the third consecutive year, we have received the best feedback from passengers passing through the gates of our airport. The awards confirm that we can ensure the high quality of our services long-term regardless of the level of traffic.

“The first two awards were won during the times of intense growth.

The 2020 award shows us that not even the crisis associated with the spread of COVID-19 can prevent us from keeping our set high customer experience standards.

“Last year, we focused on implementing a number of protective measures with the goal of protecting the health of both passengers and employees. Big thanks are owed – primarily to our employees – as it is thanks to the quality of their work that we are once again able to enjoy this award.”

Francois Berisot, CEO of Belgrade Airport, which enjoyed success in the 5-15mppa category and won a Best Hygiene Measures by Region award, said: “These awards confirm our commitment to listening to our

CUSTOMER SERVICE

customers and maintaining quality service and safe operations especially during these trying circumstances.

“Improving the airport and service experience will remain our focus for our passengers and all airport customers.”

Belgrade shared its ASQ award with seven other airports, one of which was London City Airport, whose chief operating officer, Alison FitzGerald, enthused: “To be recognised in this way by our customers is absolutely amazing and testament to the brilliant job our staff do day in, day out – they’re the ones that truly deserve all the credit.

“We’ve long been known for offering one of the quickest airport experiences in the world, but I now hope that as passengers’ book their summer holidays, they will also see London City as the friendliest airport to fly from. We really can’t wait to welcome them back as our airline partners start to scale up their operations.”

North America North America’s Best by Size winners included Hartsfield-Jackson Atlanta and Toronto Pearson finishing joint top in the prestigious Over 40mppa section; Baltimore/Washington Thurgood Marshall and Detroit Metropolitan doing the same in the 25-40mppa category; and Texas’ Austin-Bergstrom and Dallas Love Field doing likewise for airports handling 15-25mppa.

In the other sections, Victoria International was the sole winner for Under 2mppa; Greenville-Spartanburg shared the 2-5mppa accolade with Portland International Jetport; and Indianapolis, John Glen Columbus and San Antonio finished equal top for 5-15mppa.

Talking about Toronto Pearson’s success, Greater Toronto Airports Authority president and CEO, Deborah Flint, noted: “The COVID-19 global health crisis created unprecedented challenges for airport operators, and we adapted our operations and incorporated health and hygiene at the forefront of providing an exceptional passenger experience at Toronto Pearson.

“I thank our passengers for the trust and confidence that they’ve placed in us over the last year. Moreover, these awards are only possible due to the dedication and commitment day in and day out of our employees. With our Pearson employee community and our partners, we commit to leading the best in the next era of the airport experience.”

Flint also saw Toronto Pearson win a Best Hygiene Measures by Region award, which she attributes to the gateway’s Healthy Airport initiative, which is a multi-layered approach to creating a safe and

healthy airport experience which includes enhanced cleaning, informed by an industrial hygienist.

Celebrating Detroit Metro’s triumph, Wayne County Airport Authority CEO, Chad Newton, said: “It is a great honour for Detroit Metropolitan Airport to be named one of the best airports in the world for the second time in three years.

To earn the ASQ Award during a global pandemic – a time that has proven challenging for everyone –is an even bigger accomplishment.”

While Greenville-Spartanburg’s president and CEO, Dave Edwards, remarked: “In recent years, the airport has received numerous awards of excellence from industry organisations for our restaurants, retail stores, amenities and marketing activities. However, we are humbled to be recognised with such a prestigious award by the customers who have chosen GSP to meet their air travel needs.”

Elsewhere, BWI Airport’s executive director, Ricky Smith, called his gateway’s ASQ success “an incredible achievement, particularly in light of so many challenges”.

He said: “I thank our employees and partners for delivering exceptional customer service during the most challenging time in our history. I am proud of the entire BWI Marshall Airport community that has remained steadfast in providing an outstanding travel experience for our passengers.”

Latin America-Caribbean It was a case of déjà vu for the Dominican Republic’s ASQ king, Punta Cana International Airport, which finished top in the 5-15mppa category for the fifth year in a row, only this time it had to share the accolade with Ecuador’s Quito International Airport.

Serial winner, Guayaquil’s Jose Joaquín Olmedo International Airport (Ecuador) won again in the 2-5mppa category while Curaçao in the Netherlands Antilles and Liberia’s Daniel Oduber Quirós International Airport (Costa Rica) shared the spoils for Under 2mppa.

Andrew O’Brian, president and CEO of Quiport, believes that Quito International Airport’s pioneering efforts to combat COVID-19 were integral to its ASQ success.

He noted: “The operational conditions and service standards changed radically as of March 2020. At Quiport, we asked ourselves how we could guarantee high standards of protection for the health of passengers and airport employees, and immediately undertook a series of projects to adapt and maintain a safe operation.”

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Africa Kenya, Ghana and Nigeria shared the honours in the Best by Size categories for Africa, with Moi International (Mombasa, Kenya) triumphing in the Under 2mppa category; Kotoka International (Accra, Ghana) for 2-5mppa; and Jomo Kenyatta (Nairobi, Kenya) and Nnamdi Azikiwe (Abuja, Nigeria) sharing top spot for 15-15mppa.

Kenya Airports Authority’s acting managing director, Alex Gitari, admitted that the award for his gateways was most welcome and comes at a time when both are undergoing major rehabilitation work to further enhance their performance.

He said: “Winning these awards is a reaffirmation of our commitment to providing our customers with a stress-free travel experience. We are truly excited and encouraged by these prestigious awards which herald a new horizon in our customer satisfaction journey across our airports.”

While Captain Rabiu Yadudu, managing director of the Federal Airports Authority of Nigeria described Abuja airport’s success as a “huge feat that underscored the organisation’s relentlessness amid the difficult year occasioned by COVID-19 pandemic which led to financial struggle by the authority”.

Asia-Pacific and Middle East Winners of the Best Airport by Size in the Asia-Pacific region included China’s Haikou Meilan and Shenyang Taoxian airports, which shared top prize with India’s Rajiv Gandhi International Airport in the 15-25mppa category.

Beijing Daxing and Bengaluru-Kempegowda finished joint top in the 25-40mppa category, while a magnificent seven (Beijing Capital, Mumbai-Chhtrapati Shivaji Maharaj, Guangzhou Baiyun, Delhi-Indira Gandhi, Shanghai Pudong, Shenzhen Bao’an and Singapore Changi) couldn’t be separated for top spot in the Over 40mppa section.

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In the Middle East, Jordan’s Queen Alia International Airport retained its title in the 5-15mppa category for the third year running and Abu Dhabi International Airport triumphed in the category for airports handling 15-25mppa.

And the inaugural winners of the Best Hygiene Measures by Region award included seven Asia-Pacific gateways – Beijing Daxing, Chandigarh, Depati Amir, Husein Sastranegara, Netaji Subhash Chandra Bose, Pune and Soekarno-Hatta – and two from the Middle East, King Khaled International Airport in Riyadh, Saudi Arabia, and Salalah in Oman.

Videh Kumar Jaipuriar, CEO of Delhi-Indira Gandhi International Airport operator DIAL, said: “Delhi Airport has consistently raised the bar in terms of service and operational excellence. DIAL has once again consolidated its position on the world aviation map.

“As we faced several challenges due to COVID-19, we adopted the best in-house technology and other precautionary measures to make flying safer and provide a superior customer experience.

We take this opportunity to once again affirm that DIAL is committed to a safe and seamless passenger experience while they travel through Delhi Airport.”

Talking about Queen Alia’s award, Airport International Group CEO, Nicolas Claude, reflected: “More than ever before, 2020 was a year that demanded our deep understanding of the rapidly-evolving concerns, needs and expectations of our passengers. It was a trying period that further emphasised the importance of applying a customercentric approach in all our operations.”

The full list of 2020 ASQ winners, including all of the Best Airport by Size & Region, can be viewed on the ACI World website 2020 – Current Winners – ASQ Awards – ACI World.

More than half of the world’s passengers pass through an ASQ airport each year. The ASQ Awards are sponsored by travel AW technology company and affiliate World Business Partner, Amadeus.

CARGO HUBS

Delivering the goods

How did the world’s leading cargo gateways fare in 2020 and what are they expecting from the year ahead? Joe Bates reports.

I

n terms of volumes and payloads, air cargo fared much better than the passenger side of the business in 2020, and that seems likely to be repeated for most or all of this year as COVID-19 continues to wreak havoc with people’s travel plans.

Indeed, while the combination of travel restrictions, quarantine rules, the fear of catching COVID-19 and reduced airline services are keeping passengers away from airport terminals, cargo volumes have rallied and demand for some shipments has never been higher.

Months of shop closures and being forced to stay at home, for example, has led to a boom in e-commerce and arguably companies like Amazon and Alibaba have never been so busy.

While aircraft continue to bring vital personal protection equipment (PPE), medical supplies and now vaccines to countries across the globe as the world ramps up to finally put itself in a position to win the war against COVID-19.

The upturn in these consignments, in addition to the continued need for more traditional cargos flown on freighters and in the belly-hold of passenger flights, means that some of the world’s biggest cargo hubs reported an upturn in volumes in 2020.

These included Memphis International Airport (MEM), which overtook Hong Kong International Airport (HKG) to reclaim the title of the world’s busiest cargo gateway by handling a record 4.61 million (+6.72%) tonnes of freight.

Other Top 10 cargo airports recording sizeable upturns in volumes were Ted Stevens Anchorage International Airport (ANC), Taipei Taoyuan

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International Airport (TPE) and Los Angeles International Airport (LAX), which registered increases of 15%, 7.4% and 6.6% respectively.

While Louisville Muhammad Ali International Airport (SDF), Miami International Airport (MIA) and Shanghai Pudong International Airport (PVG) recorded a healthy upturn in volumes of 4.6%, 2.2% and 1.4% respectively during 2020.

In the case of Shanghai Pudong in China, last year’s slight increase to 3.68 million tonnes cemented its status as the third busiest cargo hub on the planet.

MEM’s return to the top spot after a decade of being ranked No.2 behind Hong Kong is in no small part down to it being home to the global hub of cargo giant FedEx, which accounted for the vast majority of all cargo shipments handled at the Tennessee gateway.

Chair of the Memphis-Shelby County Airport Authority’s Board of Commissioners, Pace Cooper, said: “Our standing in the air cargo industry serves as a positive reminder of the importance of FedEx and e-commerce to the Mid-South’s economy.

“It also illustrates the crucial role cargo has served during the pandemic. We look forward to ACI’s final report on the top air cargo airports later this year. Regardless, FedEx is a global leader that we are deeply proud to call our own.”

Taipei Taoyuan International Airport (TPE) reveals that transhipment cargo, which accounts for 51% of all freight handled at the gateway, soared by 20% last year, reflecting the “noticeable performance of industries” in Chinese Taipei.

CARGO HUBS

Preliminary World Top 10 Cargo Airports 2020 AIRPORT

IATA CODE

COUNTRY

ANNUAL TONNAGE

% CHANGE

1

Memphis

(MEM)

USA

4.61 million

+6.7%

2

Hong Kong

(HKG)

Hong Kong SAR

4.46 million

-7.1%

3

Shanghai Pudong

(PVG)

China

3.68 million

+1.4%

4

Anchorage

(ANC)

USA

3.15 million

+15%

5

Louisville

(SDF)

USA

2.91 million

+4.6%

6

Incheon

(INC)

South Korea

2.82 million

+2.1%

7

Taipei Taoyuan

(TPE)

Chinese Taipei

2.34 million

+7.4%

8

Los Angeles

(LAX)

USA

2.22 million

+6.6%

9

Hamad

(DOH)

Qatar

2.17 million

-1.8%

10

Miami

(MIA)

USA

2.13 million

+2.2%

The increase was also helped by the sizeable cargo fleets of TPE’s two home carriers, China Airlines and Eva Air, which the airport notes prevented it from being “greatly challenged by the decline in passenger traffic”.

The USA (32%) and Mainland China (15%) traditionally account for the bulk of transhipments at TPE, and both enjoyed robust growth in 2020, with volumes rising by 25.2% and 8.5% respectively compared

with 2019. The upturn, says TPE, reflected the strong demand for technology products made in Chinese Taipei and Asia, such as semiconductors and consumer electronics.

President and CEO of Taoyuan International Airport Corp, Jerry Dann, believes that the airport’s performance in 2020 showed the world how TPE was able to take maximum advantage of its key advantages – its location, route network and transportation facilities.

AIRPORT WORLD/ISSUE 2, 2021

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CARGO HUBS

The world hubs of FedEx (left) and UPS (right) drove cargo volumes at MEM and SDF respectively. UPS Worldport image courtesy of UPS Airlines.

Thinking about the future, he says: “Now, in pursuit of excellence, TPE is following the Taoyuan International Airport Conceptual Plan, approved by the government in early 2021, to arrange the new cargo park and the second Free Trade Zone, upgrading the cargo industry to the next level by improving efficiency and implementing innovative technologies.”

Fifth placed Louisville Muhammed Ali International Airport enjoyed its best ever year for cargo volumes, buoyed by a significant rise in goods handled by UPS, which has its global air hub (UPS Worldport) based at the Kentucky gateway. Louisville Regional Airport Authority’s executive director, Dan Mann, described 2020 as a good year for the airport and its key cargo contributor, UPS, which accounted for the bulk of the 2.9 million tonnes of cargo handled at SDF. Mann enthused: “We have a strong relationship with UPS and are dedicated to ensuring our facilities, including our airfield, are prepared to handle their current and future growth as cargo operations increase year after year. Even though 2020 was a challenging year for the aviation industry, SDF remained resilient. We are optimistic that as the US moves to recovery this increase in cargo operations will continue to trend upwards.”

Los Angeles World Airports (LAWA) has acknowledged that freight was a bright spot for LAX in 2020, officially announcing that the gateway handled 2.2 million tonnes of cargo during the year.

It says that LAX – one of the US’s busiest cargo airports for trade volumes with Asian markets – observed a gradual rise in cargo throughout 2020, experiencing significant increases in certain shipments, such as personal protective equipment (PPE), which skyrocketed by more than 20,000%.

Reflecting on the year, LAWA notes that some airlines converted their passenger aircraft cabins to carry cargo, and LAX granted more than 100 special permits for one-time operations of cargo, charter and humanitarian flight operations.

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In December, FedEx Flight 900 arrived at LAX with one of the first shipments of COVID-19 vaccines to reach Los Angeles. LAX was also the No.4 airport in the US for total cargo, with more than $95.5 billion in total cargo operations in 2020.

LAWA CEO, Justin Erbacci, told Airport World: “LAX plays an important role in facilitating global trade, and our cargo numbers from 2020 highlight that position, solidifying our place as a top-ranked national and global airport for cargo.

“Last year, LAX was a key hub for personal protective equipment, helping to get these critical items to people around the globe, and in the past few months, has become an important stop for vaccines en route to people throughout Southern California.

“Together with our partners in the aviation and logistics industries, Los Angeles International Airport will continue moving critical cargo as safely and efficiently as possible.”

You can read more about Ted Stevens Anchorage International Airport (ANC), which consolidated its Top 10 ranking courtesy of the 3.1 million tonnes (+15%) of freight to pass through its facilities in 2020, on page 36 of this issue.

Elsewhere in the US, Miami International Airport set a new record for cargo volumes in 2020 when it handled 2.1 million tonnes of freight – 57,382 more than its total in 2019.

It notes that MIA “finished the year exceptionally strong” enjoying its busiest ever months when it handled an average of 210,000 tons in October, November and December.

The Florida gateway, located eight miles north west of downtown Miami, also welcomed a record 59,000 cargo-only flights in 2020.

MIA, the busiest airport in the US for international freight and perishable products, states that it continued to be a global hub for essential supplies and e-commerce throughout the pandemic, and believes that its pharma expertise – it was the first airport in the Western Hemisphere and only the second in the world to be designated

CARGO HUBS

a pharmaceutical freight hub by IATA in 2015 – means that it is uniquely positioned to be a leading hub for COVID-19 vaccines.

“Our record-setting year would not have been possible without the strong partnership we share with each and every airline, federal agency and logistics provider that adapted and maintained their services throughout the pandemic,” enthused MIA director and CEO, Lester Sola.

“We are deeply grateful for their ongoing support and look forward to reaching even greater heights together in 2021 as we facilitate more essential trade and commerce across our region and the globe.”

ACI World’s preliminary Cargo Top 10 for 2020 also shows that Incheon International Airport enjoyed a positive year for freight volumes, with its annual tonnage numbers rising by 2.1% to 2.82 million.

Other airports, however, didn’t do quite so well as the reduction in passenger flights and the loss of the hundreds of thousands of tonnes of cargo they accommodate onboard each year meant that four of the Top 10 busiest cargo airports in 2019 experienced a downturn in volumes last year.

Former undisputed cargo king Hong Kong, for example, saw its cargo throughput dip 7.1% to 4.46 million tonnes and fellow 2019 Top 10 members Hamad International Airport (DOH) in Qatar, Dubai International Airport (DXB) in the UAE and Tokyo Narita (NRT) in Japan reported annual downturns of 1.8%, 26.3% and 4.4% respectively. The declines at DXB and NRT actually cost them their place in the Top 10 for 2020 as they have been replaced by MIA and LAX. Despite the drop, the Airport Authority of Hong Kong (AAHK) states that its cargo throughput “remained relatively stable” in 2020, and is quick to point out that HKG recorded an 18% rise in all-cargo flights during the year. It also ended 2020 strongly with a monthly increase in cargo imports and exports of 18% and 8% respectively in December.

ACI’s preliminary data for 2020 reveals that the world’s airports handled around 109 million tonnes of freight last year – 8.9% less than in 2019.

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Talking about the importance of cargo, ACI World director general, Luis Felipe de Oliveira, noted: “From time-sensitive vaccine shipments to fresh produce, air cargo is a vital – and growing – part of the aviation ecosystem.

“It supports global trade and local economic development while encouraging diversified airport operations and building long-term capacity.

“Now, during the pandemic, airports are playing an even more important role, supporting cargo operations and providing goods and services for the health of the people and communities we serve.

“Air cargo was less impacted than passenger traffic last year, with volumes in the top 10 airports increasing by 3%. This is a good sign, but airport operators must continue to work closely with their cargo stakeholders on their recovery plans, to enable more capacity as they navigate the crisis together.

“The preliminary data overall shows that the impact remains uneven with different regions experiencing different challenges and requiring different policy decisions and support from governments.”

According to the International Air Transport Association (IATA), global demand measured by cargo tonne-kilometres (CTKs) fell by 10.6% in 2020, while global capacity in available cargo tonne-kilometres (ACTKs) plummeted by 24% compared to 2019.

Nevertheless, there are some grounds for optimism as IATA revealed that global cargo demand returned to pre-COVID levels for the first time in a year when CTKs in January 2021 were 1.1% above those reported in January 2019.

And it recently stated that it expects demand for cargo to grow by 13.1% over 2020, with volumes expected to reach 63.1 million tonnes in 2021.

According to the Air Transport Action Group’s latest Aviation: Benefits Beyond Borders report, in a normal year, the world’s airlines transport around 35% of global trade by value but less than 1% of world trade by volume. That is equivalent to $6.5 trillion worth of goods annually or $18 billion worth of goods every day.

It waits to be seen how long it will take for cargo volumes to return to and eventually surpass those kind of levels, although AW the signs are good that the bounce back has already started.

CARGO

Advantage Anchorage Eland Conway tells us more about a record breaking year for cargo at Ted Stevens Anchorage International Airport and some ambitious plans to enhance its freight handling capabilities.

T

he coronavirus pandemic has caused global disruption and a downturn in passenger traffic the likes of which we’ve never seen before, and Ted Stevens Anchorage International Airport (ANC) was no exception, registering a 62% drop in numbers in 2020.

However, that doesn’t tell the full story, as 2020 turned out to be a record breaker for air freight, with cargo volumes at the Alaska gateway soaring by 15% on 2019, its previous banner year.

Indeed, the disruption to the global supply chain has sent ANC’s cargo volumes rising to more than 3.1 million tonnes.

Airport director, Jim Szczesniak, says: “The pandemic has highlighted ANC’s significance in the global supply chain. International passenger travel was decimated, seemingly overnight. The cancellation of those flights sent shippers – who traditionally rely on the cargo space available in the bellies of those passenger flights – scrambling for solutions.

“Air cargo carriers responded accordingly, recognising the strategic advantages of ANC’s location. A stop at ANC means higher payloads, more efficiency, and at a time when so many people are counting on expedited service from an already stressed supply chain – faster shipping!”

In addition to the loss of cargo space on international passenger flights, the demand for freighter space has been further exacerbated by increased demand for personal protective equipment (PPE) and booming e-commerce, as many have resigned themselves to a home-life of teleworking and self-imposed solitary confinement

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AIRPORT WORLD/ISSUE 2, 2021

adopting online shopping as the preferred shopping experience in a new reality.

Anchorage has seen first-hand, the air cargo industry’s response to the pandemic. Before COVID-19, ANC touted daily service to 21 markets and an additional 23 markets with at least weekly service.

ANC now boasts daily widebody freighter service to 30 destinations and another 20 destinations with at least weekly service.

“In addition to an increase in frequency from our traditional ANC customers, we’ve also seen a few unexpected visitors, such Ethiopian Cargo, Longtail Aviation, AeroUnion and Ukraine International,” notes Szczesniak.

“Even the Antonov 225 and the New England Patriots plane moved some PPE through Ted Stevens Anchorage International Airport.”

The shortage of cargo space sent air carriers across the globe scrambling for aircraft. In early 2018, both UPS and FDX cut MD11 operations at ANC by nearly half as they brought newer aircraft online.

In 2019, MD11 operations fell another 30%.

Since January 2020, ANC has seen UPS and FedEx’s MD11 operations steadily increase – spiking in May and June – to the highest number of MD11 operations since November 2017. A total of 443 and 442 landings for those months when combined with Western Global MD11 landings.

The airport is doubling down on its location and significant cargo transfer rights with new developments. ANC has the most liberalised cargo transfer rights in the United States.

CARGO

Since 1996, cargo carriers have been allowed to: Interline transfer between foreign flagships; Interline transfer between foreign and domestic flagships; Online transfer between foreign flagships; Change of gauge; and Commingle US and non-US bound freight on the same flight.

“We have had these tremendous privileges to transfer cargo here at ANC for quite some time, but we’ve lacked the infrastructure to properly leverage them,” says Szczesniak.

“You cannot expect an Asian customer heading to LAX to drop a pallet of iPads, pharmaceuticals or other sensitive cargo on the ramp during the long sunny days of summer or the cold Alaska winter months and have to wait for it to be loaded on a connecting flight.

“ANC’s new facilities coupled with the transfer rights and ANC’s network of freighters will be a game changer.”

Before the pandemic, Alaska’s gateway to the world sought five proposals to develop its cargo infrastructure. To date, ANC has received proposals from Alaska Cargo & Cold Storage (ACCS); IC Alaska; 6A Aviation; UPS and FedEx that between them total more than one billion dollars in private development.

ACCS and 6A have fully executed lease agreements, with the latter set to break ground west of the north-south runway this spring in what will become the first development in the West Airpark. The remaining lease agreements are currently being negotiated.

ACCS, an Alaska based company has received, through the Alaska Energy Authority (AEA), a $21 million BUILD grant from the US Department of Transportation. Ground-breaking will commence in the fourth quarter of this year and be constructed in phases. The first phase being approximately 190,000 square feet.

UPS will be expanding their existing 35 acres footprint by an additional 28 acres, adding three more spaces to accommodate their growing fleet of B747-8s. The project includes a significant expansion of their cargo sort facilities, ground service equipment, and employee parking areas.

FedEx is also expanding their existing 63 acres footprint. The additional 19 acres will support its 98,000 square feet Domestic Operations Centre and nine new small aircraft positions. The new

development accommodates all of FedEx’s local traffic allowing for more widebody international traffic at their existing facility.

IC Alaska is seeking to develop the largest development on the south side of the airport. The new facility will provide 14 flow through widebody parking positions, warehouse space, and seeks to capitalise on ANC’s strategic location to develop a global MRO operation.

Szczesniak says: “With 2,600 jet engines transiting through ANC annually, it makes perfect sense to conduct parts distribution and MRO here in Anchorage.

“Parts warehousing and distribution is much cheaper here, where land is cheap and space is ample, compared to the high rent and scarcity of space in many Asian cities.

“We also have a strong workforce to pull from. There are two universities with well-established aviation maintenance programmes and nine military bases in Alaska. Aviation is the life blood of Alaska.”

ANC is working to bring passenger travel and cargo together – leveraging newly expanded passenger transfer rights. The expanded passenger transfer rights mirror existing cargo transfer rights, which allow: On-line passenger transfer to US destinations; On-line passenger transfer with change of gauge; Interline passenger transfer to foreign carriers to foreign destinations; Passenger transfer to US carriers to US destinations; and Passenger transfer to US carriers to foreign destinations.

“We have analysed passenger aircraft performance and belly cargo capacity, and there is a substantial revenue opportunity for airlines to utilise ANC,” enthuses Szczesniak.

“For example, the Hyderabad, India, to LAX non-stop has a belly cargo weight penalty – a stop at ANC eliminates that penalty and allows for more than $64,000 in additional cargo revenue for each flight.”

“Transferring passengers and cargo at ANC creates synergies for airlines for more destinations, there are a lot of interesting route combinations that can benefit from routing through ANC.” Adversity often spawns creativity, and the pandemic has provided nothing if not adversity. At a time when the aviation industry is facing adversity head-on, ANC is working hard to garner the attention of the AW industry seeking new creative ways to operate.

AIRPORT WORLD/ISSUE 2, 2021

37

SUSTAINABILITY

Green pioneers Airport World reviews a handful of pioneering new sustainability initiatives and salutes Swedavia for becoming the first operator to achieve Net Zero emissions across its airport network.

S

an Francisco International Airport (SFO) has announced the expansion of its industry-leading plastic-free policy to prohibit the sale of any beverages in plastic bottles.

In August 2019, SFO became the first airport in the world to prohibit the provision or sale of single-use water bottles in plastic or aseptic paper packaging.

This policy has now been expanded to prohibit the sale of any beverages, including sodas, teas, and juices in plastic or aseptic paper packaging.

“This is a significant moment in our goal to achieve zero waste going into landfill,” enthused airport director Ivar Satero. “We took a very important first step two years ago, and now we take the next step towards a plastic-free future.

“Throughout this journey, it has been our SFO business community which ensures our success, and we thank our partners for having the courage to be leaders in our industry.”

In 2016, SFO established a goal to achieve zero waste going to landfill. To achieve this goal, SFO has been working with concessions and tenants on supporting policies, including a requirement to provide single-use food ware in compostable packaging.

Based upon waste characterisation studies, 33% of the items sent to landfill from SFO are food or food service ware and beverage containers.

In August 2019, SFO implemented a Zero Waste Concessions Policy to prohibit the sale of water in plastic bottles or aseptic paper

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packaging. At the time, approximately 10,000 bottles of water were being sold at SFO every day.

This expanded programme further avoids the energy-intensive production and diverts 1,000,000 fossil-fuel-based beverage containers a year from landfill.

SFO has provided airport retailers with a guide of approved alternatives to plastic beverage bottles. In addition, SFO installed 100 hydration stations across the airport to expand access and encourage passengers to bring refillable bottles.

Net Zero CO2 emissions for Swedavia’s airports ACI Europe has welcomed Swedavia’s announcement that all ten of its Swedish airports have achieved Net Zero CO2 emissions across all operations under its control – a world first.

Swedavia has therefore become the first company to deliver on the European airport industry pledge to become Net Zero by 2050 at the latest.

Marking the milestone as it published its Annual and Sustainability Report, Swedavia mapped out the next steps in its commitment to climate change, which is to support other companies and organisations at its airports to further transform their operations to become more environmentally friendly.

ACI Europe’s director general, Olivier Jankovec, remarked: “Swedavia’s achievement is the culmination of a tireless focus on a sustainable future.

SUSTAINABILITY “Realising their ambition to reach fossil-free operations across all ten of their airports is a testament to the commitment, innovation and vision they have shown for many years. We congratulate them wholeheartedly on this remarkable achievement – in the most challenging of times.”

ACI Europe also took the opportunity to highlight what it calls the increasing challenges faced by the continent’s airports as they strive towards decarbonisation.

It notes that Europe’s airports have led the way in tangible planning and achievements towards Net Zero; first with its innovative Airport Carbon Accreditation programme, launched over ten years ago and now rolled out worldwide, and subsequently via their commitment to Net Zero 2050, publicly made in 2019.

However, the devastating effect of the global pandemic has made the challenging task of decarbonising aviation even more daunting, according to Jankovec.

He says: “Through the ongoing ambition of our Airport Carbon Accreditation programme, further enhanced through the introduction of two new accreditation levels, our close involvement in the European aviation sector’s recent Destination 2050 roadmap, and our call for the EU to join us in a Pact for Sustainable Aviation this year, we continue to strive towards our climate goals in tangible and actionable ways. Our ambition remains undimmed.

“But make no mistake. Decarbonisation takes investment. This pandemic has dealt Europe’s airports a crippling blow. With over 1.72 billion passengers lost across the network in 2020, resulting in lost revenues exceeding €32 billion, a renewed support of governments and institutions as we chart our path to a more sustainable recovery is crucial.

“Yet, we still need to see the EU walk the talk on that – not least by allowing airports to access funding under the EU Resilience and Recovery Facility.

“Swedavia shows us what is possible. Our commitment to Building Back Better remains undiminished. Let’s work together with a vision of realising common goals”.

Enhancing waste management Doha’s Hamad International Airport has signed a Memorandum of Understanding (MoU) with Qatar’s Ministry of Municipality and Environment (MME) to improve its waste management.

As a result, the airport (DOH) says that it will develop and modernise its facilities by implementing new, more effective methods of waste management.

The MoU outlines the collaboration between MATAR – the Qatar Company for Airports Management and Operation – and the government for the management of different types of waste from DOH to the MME’s Domestic Solid Waste Management Centre.

According to the airport, the objectives of the MoU include the development of an integrated system for waste separation, safe transportation, recycling and disposal of waste, and the promotion of environmental awareness and culture of sustainability at DOH. Hamad International Airport’s chief operating officer, Mohammed Al Meer, said: “We are committed to optimising our airport operations by improving our environmental performance.

“We are delighted to continue to contribute to Qatar’s National Vision 2030 pillar of environmental development by entering this strategic partnership with the Ministry of Municipality and Environment to further enhance our waste management systems.”

The airport believes that its new collaboration with MME provides another example of its commitment to the environment and the sustainable development of Hamad International Airport.

As well as actively striving to reduce waste, greenhouse gas emissions and noise pollution, DOH’s sustainability measures also extend to waste water management, with most water used at the airport directed to DOH’s dedicated waste water treatment plant, which returns the treated water for irrigating the airport’s landscape features.

In 2018, DOH’s treatment plant was successful in recovering 93% of waste water for re-use. The airport continually reviews its systems to identify areas of improvement for long-term efficiency and sustainability.

Sustainable aviation fuel initiative Rotterdam The Hague Airport, SkyNRG and Climeworks claim that they are taking the next step in realising Zenid – a demonstration plant producing fully circular sustainable aviation fuel directly from air.

Global energy company Uniper has signed a Memorandum of Understanding (MoU) to support Zenid with engineering and operating expertise.

SAF purely made from air via direct air capture technology and renewable electricity offer a carbon-neutral solution suitable to meet the industry’s high demands for renewable fuels in the future.

The Dutch gateway will be working on the project with Rotterdam The Hague Innovation Airport, an innovation subsidiary formed with the municipality of Rotterdam. Climeworks are described as Swiss direct air capture pioneers.

Rotterdam the Hague Airport director, Ron Louwerse, says: “Rotterdam the Hague Airport is very proud to be one of the kickstarters of this ground-breaking project, together with Schiphol Group and Rotterdam The Hague Innovation Airport (RHIA).

“It fits exceptionally well within our strategy to facilitate and accelerate sustainability and innovation in aviation, to be at the cradle of sustainable aviation fuel made of CO2 from air. We support this project with our know how and local networks.”

The demonstration plant will be powered by regionally sourced renewable energy and combines several innovative technologies: a direct air capture plant provides CO2 to a highly efficient coelectrolysis unit, that turns the CO2 and added water into syngas.

The syngas is transformed into liquid hydrocarbons by a modular Fischer-Tropsch reactor and then refined into sustainable aviation fuel.

AIRPORT WORLD/ISSUE 2, 2021

AW

39

WBP NEWS

Open for business A snapshot of the latest news from ACI’s World Business Partners.

Jacobs to help Washington DC airports enhance passenger experience The Metropolitan Washington Airports Authority has chosen Jacobs to help it enhance the overall airline and passenger experience at Reagan National and Dulles airports.

Under the terms of the agreement, Jacobs will provide facilities condition assessment (FCA) and enterprise asset management (EAM) services at both Ronald Reagan Washington National Airport (DCA) and Washington Dulles International Airport (IAD).

The five-year contract includes a base year with multiple one-year options and includes work to assess how buildings and infrastructure are managed, analyse capital investment needs, discover areas for improvement and prioritise critical maintenance and repair projects.

“Our long-standing relationship with the Metropolitan Washington Airports Authority is even more important now as air travel begins to increase, and this project will prioritise keeping airports safe, efficient and reliable for travellers,” said Jacobs’ people and places solutions executive vice president, Ken Gilmartin.

“Working collectively, we have the opportunity to improve the passenger experience and make travel easier for individuals using Washington, DC’s airports.”

Jacobs’ consulting team will integrate physical asset inventories with EAM technology to save costs, improve quality and efficiency of resources, extend facility life, and enhance safety, health, and environment initiatives at both airports.

Smiths Detection secures two new security contracts Kuwait international Airport and London Heathrow are the latest gateways to order security screening technology from Smiths Detection.

In Kuwait, the company will provide a full suite of passenger baggage screening equipment for the airport’s new Terminal 2, which is currently under construction.

The contract includes the supply and installation of 70 x Hi-SCAN 6040 CTiX computed tomography (CT) X-rays, which allow passengers to leave electronic devices and liquids in their baggage.

While at London Heathrow, Smiths Detection has been chosen to supply integrated checkpoints across the UK hub that feature the same technology to deliver what it calls “an advanced level of security and efficiency”.

The ECAC EDS CB C3 approved CT systems will allow Heathrow to meet the highest regulatory requirements, while helping it achieve its vision for the future of the security checkpoint for passengers and colleagues.

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AIRPORT WORLD/ISSUE 2, 2021

The integrated checkpoints will feature iLane automatic tray return systems and Checkpoint.Evoplus, Smiths Detection’s checkpoint operation management solution. The award also includes a 10-year equipment service agreement.

Talking about the Kuwait deal, the company’s vice president for APAC and Middle East, Jerome de Chassey, said: “The solutions that they have selected are the most technically advanced and are being installed in some of the biggest airports across the globe.”

RUNNING WBP NEWS HEAD Boingo Wireless Membership Region: North America Type of business: IT and Communications W: www.boingo.com Boingo Wireless makes it simple and easy for people to enjoy Wi-Fi access on their laptop or mobile device at more than 450,000 hotspots worldwide. With a single account, Boingo users can log on to Boingo Network locations that include the top airports around the world; major hotel chains; cafés; coffee shops; restaurants; convention centres; and metropolitan hot zones. Boingo and its Concourse Communications Group subsidiary, operate wired and wireless networks at 58 airports worldwide.

Faith Group

Sneak preview of Chengdu Tianfu’s commercial offerings China Duty Free Group (CDFG) and The Design Solution have provided a sneak preview of their design scheme for the 4,000sqm airside commercial area at Chengdu’s new Tianfu International Airport (TFU).

The airport is due to open in mid 2021, ready for the International University Sports Federation (FISU) Chengdu 2021 Summer World University Games in August.

Said to be inspired by the cultural heritage and evocative era of the Silk Road that first connected South West China with the rest of the world – introducing trade in fine goods including tea, gunpowder, silk and paper – the design scheme marks Chengdu’s significance throughout history.

According to The Design Solution, the curation reflects several local influences to immerse and engage passengers with a true sense of Chengdu and the Sichuan province.

A key design inspiration in the scheme is the flowing movement and organic nature of silk, featured throughout the stores, to express the movement of the traders on the route itself.

The natural beauty of the region is introduced with delicate cherry blossom influences and bamboo forms represented in authentic furnishings, fret cut metal and other design details throughout the space.

The scheme comprises a central commercial area experienced by all passengers as they clear security and transit, with three piers leading off to the gates.

This features two walk-through duty free stores with open store frontage encouraging passengers to enter and explore. The interior features a distinct expression for each category, creating a unique, multi-layered shopper experience.

The Liquor and Tobacco category is split in two defined zones, while a special feature is the China Duty Free VIP lounge for invited guests, a restful cocoon just a step away from the busy terminal walkways.

Other unique features include Chocolab – a new bespoke confectionery concept where fun, entertainment and education combine playfully to spotlight the making of chocolate as a magical laboratory concept – and an electronic experience centre which invites exploration with ‘gamefication’ as an engagement strategy and product merchandised on play tables to enable trial before purchase.

Nick Taylor, director of UK-based The Design Solution, comments: “This design scheme has been a unique and fascinating challenge – bringing to life China Duty Free Group’s vision to distil the essence of Chengdu and the province of Sichuan, both culturally and physically, as an authentic expression of its DNA.”

Membership Region: North America Type of business: Consulting and Management W: www.faithgroupllc.com Faith Group LLC provides planning, design and PM/CM services focused on security, safety and telecommunications services for the aviation industry. We employ seasoned professionals with hands on experience in all aspects of airport operations. Our services include business processes re-engineering, shared tenant services analysis, safety and emergency management planning, and policy systems.

York Aviation Membership Region: Europe Type of business: Consulting and Management E: richard.connelly@yorkaviation.co.uk W: www.yorkaviation.co.uk York Aviation is a specialist consultancy focussing on all aspects of the airport business.

We advise airports, airlines and investors in relation to demand forecasting, route development, capacity assessment, economic regulation, economic impact and appraisal, financial modelling, business planning and master planning.

AIRPORT WORLD/ISSUE 2, 2021

AW

41

HUMAN RESOURCES

PEOPLE

matters Commercial spirit Terri Morrissey and Richard Plenty provide their thoughts on the type of entrepreneurial mindset that might be needed to help airports bounce back from COVID-19.

H

ow can you create the commercial spirit that will help airports to recover the ground lost during the pandemic?

In our work with organisations and organisation culture we have met and worked with many successful entrepreneurs.

Most have run their own companies, but a few have been successful inside corporations.

Whatever the setting, they have all had characteristics in common that make them entrepreneurial and distinguished them out from the mainstream.

What can be learnt from them? What are their qualities, and can they be cultivated?

Take the Irish entrepreneur, Liam Young, as an example. He was working in a major telecommunications firm and spotted a business gap in service. The organisation was not interested in his idea, so he left, found a backer and a business partner, and ended up creating a major directory enquiry service in Ireland and in Europe.

He eventually sold this enterprise making over €40 million. And he did not stop there. He went on to become a ‘serial entrepreneur’ investing in start-ups, taking more enterprises to success.

• Entrepreneurs like Liam demonstrate the ability to both spot business opportunities and act on them. The second part of this is critical. Many people have good ideas but do not have the courage or the tenacity to turn them into reality. Consequently, their ideas never get off the starting blocks.

Having the will to succeed, being resilient in the face of obstacles and possessing self-belief and self-efficacy are key parts of the mindset that differentiate the successful entrepreneur.

• They also demonstrate the ability to be persuasive communicators. Entrepreneurs have the capacity to bring others along with their ideas, including investors. They can

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create a compelling vision for the future and motivate people to follow them • They tend to set their own goals, are driven to succeed and are open to learning and feedback from others. They are prepared to try things out and are not afraid of failure.

The British inventor and entrepreneur James Dyson, for example, has used learning from experience as a key part of his business model. Speaking about the development of his vacuum cleaner, he says: “I made 5,127 prototypes of my vacuum before I got it right, but I learned from each one. That’s how I came up with a solution. So, I don’t mind failure.”

It is easy to see how established organisations might benefit from this innovative perspective, but how easy is it for them to hold on to people with an entrepreneurial mindset?

It’s difficult but not impossible. All entrepreneurs we have met have a drive to be self-reliant. They prefer to think independently and like to feel in control of their own destiny. Consequently, many do not really like working for someone else and do not stay in corporations.

But there are others who can enjoy working within an established organisation for a broader purpose, with a ready network of skilled colleagues and access to resources.

Organisations that value challenge, encourage diversity of thinking, allow for experimentation and failure and are not bureaucratic are more likely to foster entrepreneurship and keep such individuals. Some organisations create hubs of enterprise allowing ideas to flourish, bringing ideas from the edge into the mainstream and fostering innovation.

The challenge facing airports right now is how to seize this opportunity to cultivate the entrepreneurial spirit and mindset of the future, to encourage creativity and innovation and to ‘build back better’.

Creating a culture where entrepreneurship can flourish is a key part of the leadership agenda.

The search is on for a new CEO for Berlin Brandenburg Airport after the supervisory board of Flughafen Berlin Brandenburg (FBB) reluctantly accepted Engelbert Lütke Daldrup’s request to terminate his employment in September 2021. Lütke Daldrup is leaving because he says that he has fulfilled his role of overseeing the opening of Germany’s new €6 billion gateway.

Chairman of the supervisory board, Rainer Bretschneider, stated: “Engelbert Lütke Daldrup took on great responsibility at a very difficult time for FBB and has lived up to the hopes and expectations placed in him. The fact that BER went into operation was largely because of his work. We owe him a great debt of gratitude.”

IATA has a new director general after former IAG CEO, Willie Walsh, officially succeeded the outgoing Alexandre de Juniac in the role on April 1, 2021. Walsh said: “I am passionate about our industry and about the critical work that IATA does on behalf of its members, never more so than during the COVID-19 crisis.”

Stephen Thompson is the new airport manager of Tyler Pounds Regional Airport (TYR) in Tyler, Texas, USA. He moves from Denver International Airport where he served as its manager for airport safety.

About the authors Terri Morrissey and Dr Richard Plenty are directors of This Is…, authors of the book Uncertainty Rules? Making Uncertainty Work for You, and deliver ACI World’s Airport Human Resources training. You can contact them at info@thisis.eu

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