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An ‘instant cargo facility’ developer is targeting the newfound, if temporary, surge of interest in air freight.
Just as airlines adapted to the new realities of the market by stuffing cargo in cabins, now airports can field prefabricated cargo facilities, which can be up and running in six months, at low cost.
But not every airport or market is suitable, warned one cargo consultant.
AutoLogic Airports has developed a low-cost cargo solution to allow “airports without previous cargo experience to generate a new revenue stream”: iCargo is a semi-permanent modular building with integrated hardware and software that can process between 40,000 and 3m tonnes of cargo a year.
Prefabricated, it takes just “weeks” to erect, claims the developer, is not subject to normal planning requirements and has a 15-year lifespan. Hardware available includes cargo system conveyors, EU/TSA cargo x-ray and explosive trace detection, Customs zones and optional UV and fridge freezers.
AutoLogic claims the full facility can be operational within six months.
“We know flights are currently operating significantly under capacity and, by using the excess space for cargo, lost revenue can be redeemed,” said Alex Bradley, director. However, many airports don’t have an operational facility to handle cargo and are missing out.
“We understand that it takes years and significant budget to build a cargo facility, so it’s fantastic to be able to offer a solution that is just as effective but can be operational within months at a fraction of the cost.”
One European airport cargo executive said: “It’s a one-stop shop, from nothing to a cargo facility. It is entirely feasible, a quick solution and automated so anyone can run it. Of course, you are going to want to put it in an airport with more than just low-cost passenger traffic, you’ll need different opportunities in the pipeline.”
He added that the “fundamentals are flexible – either an airport or an investor could fund it”.
However, warns Michael Webber, a North American airport consultant, there are significant differences between the European and US airport markets.
He said: “Notably, the market share shifts we have seen in the US don’t really conform to part of what seems to be inferred here as potential demand generation.
“Looking at the cargo performance of airports in the fourth quarter, national and regional hubs for the integrators were doing great. But major passenger hubs, such as Dallas/Fort Worth, Atlanta and San Francisco, for example, couldn’t compensate for the losses in belly capacity their hub carriers inflicted.
“Integrators are best suited to dealing with these unexpected surges. They control their ramps (usually), their labour and equipment and have the ability to move ULDs through the airport to do off-airport build/break when capacity is constrained.
“It might be an appealing solution in situations when timing is critical and an airport that hasn’t traditionally been more than a marginal O&D market captures the interest of a significant new entry tenant, like an Amazon. Some have asked about the spring-style cargo terminals that can be more easily deployed and removed for seasonal users, and for short-term experiments by interested operators ahead of making longer-term capital investments.
He added that US-Europe infrastructure problems were also different.
“In the US, most airports still do not have a critical deficit in cargo facility capacity that might make this concept more appealing,” he explained.
“There are still plenty of former Airborne Express, BAX Global, Emery Worldwide and Kitty Hawk spaces that are either dormant or occupied by non-cargo users that could be clawed back for cargo users if demand existed. Amazon has occasionally used those relatively cheaper spaces to experiment with markets before committing to new, more expensive facilities.”
He added that, while airports such as Los Angeles and Chicago O’Hare had capacity constraints, they were caused not by excess demand, but demolition or re-use of existing cargo buildings. US airport operators tend to be heavily constrained by bureaucracy – the likely required feasibility and environmental impact studies “would impose another year before an order could be placed”.
AutoLogic Airports has partnered with Airports Council International, which said the product was a “timely development”.