Thursday 17 August 2017

Why Manston will not be a cargo hub anytime soon

Following on from the last blog LINK

We will now examine what makes a freight hub and why Manston cannot work. This report relies upon a report compiled by:- 

Lucy Budd BA, MSc, PhD*, Stephen Ison BA, MA, PhD, MCILT* and Thomas Budd BSc, PhD**


*Transport Studies Group

School of Civil and Building Engineering

Loughborough University


LE11 3TU


**Department of Air Transport

Cranfield University


MK43 0TR

Developing air cargo operations at regional airports: a case study of East Midlands Airport, UK.

It is interesting as to how this compares to the report compiled by Dr. Sally Dixon who it seems also has a connection to Cranfield but fails to take this report into account when writing her report on the future of a cargo hub at Manston.

"The paper concludes by identifying elements of best practice and examining the extent to which the development of successful cargo operations at EMA could serve as a model for other regional airports worldwide that are seeking to develop complementary passenger and freight services."

 These are as follows

"From its opening in April 1965 as a commercial facility, East Midlands Airport has actively sought to encourage the development of air cargo through a series of strategic planning and management interventions. Successive public and private owners have recognised the need to develop a comprehensive yet complementary range of passenger services during the day and cargo operations at night."

So to be clear East Midlands thrives because it operates 24/7/365, daytime is passengers and night time it is freight.

"The airport’s single 2,893 x 60m (9,492 x 197ft) east/west grooved flexible asphalt runway has an International Civil Aviation Organisation (ICAO) Pavement Classification Number (PCN) of 78/F/C/W/T. This means the runway’s load bearing capacity is sufficient to safely support operations by all major commercial aircraft up to and including the An-124, B747-400F and Antonov 225"

To be clear Manston's runway is unable to handle the most common long haul freight aircraft the Boeing 747-400F unless the aircraft is less than full.

"In December 2003, the UK Government’s ‘Future of Air Transport White Paper’ recognised the national importance of developing passenger and freight services at EMA and predicted that the airport could be handling over 12 million passengers and 2.5 million metric tonnes of cargo on 60,000 cargo flights a year by 2030"

Current airfreight at EMA is almost 300,000 metric tonnes(as of 2013) so capacity is still available.

"Whereas Heathrow and Gatwick (and, to a lesser extent, Manchester) are relatively capacity and slot constrained and have strict operating conditions that prevent full 24-hour flight operations, East Midlands and Stansted currently have spare capacity and EMA has an unrestricted 24-hour operating licence. This allows EMA to serve passenger aircraft during the day and freight aircraft at night. Heathrow and Gatwick on the other hand, owing to the absence of slots and more restricted hours of operation, see virtually all of their air cargo arrive in the holds of scheduled passenger services. In addition, East Midlands and Stansted offer further advantages for cargo operators. Both are located in more rural areas of the country where land is cheaper and relatively fewer people are affected by aircraft noise; both are surrounded by greenfield sites which could be made available for future expansion (subject to planning permission); both are located near major trunk roads for ease of delivery and onward distribution and both are now owned and operated by the same company – Manchester Airports Group (MAG). EMA has the added advantage of being centrally located within the UK near the intersection of major north-south and east-west trunk roads."

So to be clear the East Midlands airport operates an unrestricted 24 hour licence handling passengers during the day and freight during the night. East Midlands and Stanstead offer a significant advantage as they operate in a rural environment (unlike Manston which has towns at both ends of the runway albeit Herne Bay is further away than Ramsgate). Both EMA and Stanstead are located near major trunk roads, EMA also has the advantage of being centrally located near the intersection of Major Trunk Roads.

The history of the East Midlands is eerily similar to Manston but it comes as no surprise to realise that EMA has much more going for it that ever Manston had bearing in mind where Manston is located compared to EMA and for RSP and Sally Dixon to ignore Manston's geographical location is bemusing. It is true however you get what you pay for in this world.

"The origins of aviation at EMA can be traced back to 1916 when Castle Donington airfield was established to serve the needs of 38 Squadron in their defence of Midlands’ airspace during World War One. Abandoned after the declaration of the Armistice, the site was subsequently redeveloped as a military airfield with a hard-surfaced runway during the Second World War before being closed for a second time in 1946. In late 1947, the site was acquired by the UK’s Ministry of Civil Aviation as part of the new National Airport Plan which sought to concentrate passenger services at a few key airports (see Sealy, 1976). By the mid-1950s it was apparent that the existing municipal airport serving the East Midlands at Burnaston near Derby was becoming obsolete as the grass runways could not support the weight of the new post-war commercial aircraft that were being introduced.

The need for a replacement facility was first articulated by the Corporation of Nottingham who, together with a consortium of Local Authorities, formed a Joint Airport Committee (JAC). After evaluating a number of potential sites, the JAC decided that the abandoned airfield at Castle Donington should be developed as Burnaston’s successor (Walker, 2005). It was thought that the site offered significant development potential as it lay roughly equidistant between the region’s three major cities of Leicester, Derby and Nottingham, boasted favourable flying conditions and, most importantly, was adjacent to the proposed London-Leeds M1 motorway, the first section of which opened in November 1959. From its inception, the new facility was promoted as a ‘Motorway Airport’ with the supporting local authorities demonstrating an early appreciation of the future strategic importance of fast, easy and efficient road access to the airport’s commercial future (Rowley, 1965). The initial planning application was submitted in 1960, construction commenced in spring 1964 and the new East Midlands Airport (EMA) opened for commercial civilian operations on April 1st 1965.

It does seem surprising that someone who gained some qualifications from Cranfield seems to totally ignore the advantages that EMA has compared to the disadvantages that beset Manston.

What of Stanstead Airport? Well here are the key facts that Stanstead advertise and it is uncanny how many seem to have made it into Sally Dixon's report especially the equine information.

Key facts
  • Handling around 230,000 tonnes annually, Stansted Airport is the the UK’s 3rd largest cargo airport and London’s premier pure cargo gateway.
  • The airport is operational 24/7/365
  • Fire fighting category 7 with CAT 8, 9 & 10 available by request
  • Stansted’s dedicated cargo stands can simultaneously accommodate 4 x A380, 3 x B747-8F, 1 x B747-400F and 1 X B767-300
  • Stansted’s 3,049 metre runway offers full intercontinental capability and provides full CAT IIIb ILS protection
  • With 120,000 remaining spare slots London Stansted is the only major London airport with capacity to support the immediate growth of the UK’s aviation sector
  • Stansted’s proximity to LHR makes it ideal for combi carriers wishing to supplement bellyhold capacity with maindeck freighter traffic
  • The airport’s south-eastern location allows reduced flying time from Asia, Europe and Africa
  • 27% of the UK’s pure freight is flown to or from Stansted
  • 21% of the UK’s pure mail is flown to or from Stansted
  • 8% of the UK’s total air cargo volumes are flown to or from Stansted
  • London Stansted handles in excess of £8bn in trade value annually
  • Experienced cargo handling companies on-site
  • Significant land availability for future development
  • At the heart of UK bloodstock sector with Newmarket just 30 miles away, Stansted is the primary UK gateway for some of the world’s finest race horses and polo ponies

 So far from cargo slots being restricted it seems that with 120,000 spare slots available it does seem awfully strange that Sally Dixon fails to note this in her extensive report.

Finally it does seem somewhat odd that the Save Manston Airport association publish a "myth Buster" when the only myth's that need busting are those put into the ether by Tony Freudmann. I do wonder why they feel it necessary to defend themselves against the lies put out by RSP but each to their own. The only thing SMAa are good at is abusive comments and acting as some sort of cult.
Point one: It is irrelevant what SMAa want it is RSP and the Freight Forwarders that will determine night flights. SMAa will not be running an airport if it re-opens.
Point two: As SMAa has failed to publish accounts since inception who knows where the money comes from.
Point 3: If it is ever submitted. Promises were made over a year ago and the timetable has slipped ever since.
Point 4: No prospective suitor has ever produced verifiable proof they have the money to re-open Manston and that includes any fronted by Tony Freudmann.
Point 5: This is funny as they have never supported anyone other than the Tories, in fact they have abused both Labour and UKIP on a regular basis.
Point 6: London City airport isn't a cargo hub. The two main Cargo hubs outside of the big two both handle freight during the night.
Point 7: RSP have no aviation experience bar Tony Freudmann who failed miserably in 2005 losing many local shareholders vast sums of money.

Wednesday 2 August 2017

Is reopening Manston as a freight hub a viable option

During the last 15 years every owner of Manston has tried but failed to make a profit from the freight business and despite money invested business has failed to take off (pardon the pun). Infertil Limited purchased Manston from the failed EUjet/Planestation/Wiggins group in 2005 and over the next 9 years invested £40-£50M and still failed to turn a profit. They threw in the towel and asked Price Waterhouse Cooper to find a buyer and in 22 months NOT ONE buyer from the aviation world came forward. Eventually they sold it to Ann Gloag’s Lothian Shelf for a £1 and all the debts.

What is airfreight and what is carried is a question asked. Airfreight is exceptionally expensive (unless subsidised by being carried in the belly of passenger planes) compared to road freight and cargo ships. So it is reserved for expensive “just in time” goods such as electronics and pharmaceuticals, and low value flowers and vegetables from 3rd world countries where “time is of the essence”. 

During those years airfreight at Manston has only managed 1%-2% of the total UK airfreight business. 

 To put this into context total freight in the UK is around 500 Million tonnes and airfreight is a miniscule 2.3Million tonnes (1/2 of 1%) and Manston achieved at its busiest 32240 Tonnes (1.38% of airfreight, .006% of Total freight)
Manston has tried and failed to attract the dedicated freighters which are handled more efficiently at freight Hubs such as East Midlands, Stanstead, Luton and latterly at Southend all of which have spare capacity both now and into the future. “...The London Airports together currently have 40-50% spare capacity available”. In 2016 Heathrow brought in 65% of all airfreight (95% in the belly of passenger planes) leaving just 835000 tonnes for every other airport in the UK to share out. RSP propose to take 500-600 thousand tonnes (That is 72% of the available freighter market) and that from a standing start.
The question then becomes why are those airports much more successful in attracting the freight business and why hasn’t Manston managed in the last 15 years? The answer is geography. Any freighter bringing in cargo has a choice. Land at Manston 60 miles away from the M25 and negotiate the Dartford river crossing or add 10 minutes flying to Stanstead or Luton or 15 minutes to East Midlands where there are major motorway links, Road links and central distribution hubs to complement the airports. I have ignored Heathrow as has RSP as the cost of transhipping freight is subsidised by passengers which is why 65% of all airfreight goes to Heathrow.
When Manston was operational they handled about 2 freighters a week sometimes less, mainly African produce and it is hard to see how they would be able to attract business unless they cut the landing costs again which seems to be the only way they could attract business. Listening to those that worked there it becomes apparent that most freighters left empty and without refueling because there were airports with export freight and cheaper fuel.
There is a series of reports by Dr. Sally Dixon which paint a far more upbeat prospect for Manston however this is based on World Wide expansion of freight which doesn’t relate at all to the UK which at the time of writing has achieved 2.3 Million tonnes of freight consistently for every year from 2007 to 2017. Dr Sally Dixon believes that much export freight is loaded into Lorries and goes out of the country to the near continent to be loaded onto aircraft. The report explains this by saying there is a lack of freight capacity in the UK which is complete nonsense. (See above). Since 1999 there have been many promotional forecasts, the only consistency is that they all failed to achieve what they promised.

Actual best year was 2003 at 43000 tonnes

In 2010 Freighter Air Transport movements (ATM’s) totaled 51000 and by 2015 this had increased to 55000 movements and increase of 1.5% per year. The Department of Transport forecast this to grow to 60000 movements by 2050 which equates to just ¼% per year. In other words it will be flatlined for 35 years and this may even be optimistic if more cargo is shipped in the belly of passenger planes.

"The UK demand for all air freight remained flat from 2003 to 2013, furthermore, the UK totals for 2015 (2,299,000 tonnes) and 2016 (2,385,000 tonnes) confirm that pattern has been maintained over at least the last 13 years. The contribution by Manston showed no growth and hovered between 1.2% and 1.5% of all airfreight. It was a minor player in the freight market throughout its operation.

 CAA statistics show the split between the quantity by weight of incoming (known as ‘set-down’) and outgoing (‘pick-up’) cargo. It shows there was a highly skewed imbalance in favour of import over export tonnage.

 99% of freight was carried by non-UK operators.
 92% of freight was set-down
 7% was pick-up
This imbalance would have severely affected the efficiency and profitability of carriers. This picture suggests that there was a lack of UK market demand to ‘export’ freight by air from Manston or that other operational factors were having an impact.
In 2013 the airfreight handled at Manston was 29,306 tonnes. Analysis of CAA statistics shows this was carried via 511 dedicated freight aircraft ATMs. On average therefore each ATM accounted for
57.4 tonnes of cargo. On the assumption that there are equal numbers of inbound and outbound ATMs it is possible to derive the average payload of each given the recorded set-down and pick-up tonnages. On this basis the average ‘set-down’ payload was 106.4 tonnes; and the average pick-up payload was a mere 8.5 tonnes. In other words set-down aircraft were arriving heavily laden but, in many cases, departing empty." * report by The Ramsgate Society

What about the planes used to carry Freight

"The freight ‘workhorse’ Boeing 747-400F requires a take-off field length ranging from 9,250 feet to 10,950 feet (depending on range, payload and overall weight). This poses a serious problem for the future of Manston with its runway at 9029 feet in length. While it may be sufficient to land fully laden aircraft it is not capable of handling this market leading freight aircraft at maximum take-off weight. This puts Manston at a considerable commercial disadvantage compared to its competitor airports in the UK. Manston ranks only 11th in terms of the length of runway in the UK, and behind leading
dedicated freighter traffic rivals East Midlands and Stansted. It makes it unattractive to air freight operators. The relatively short runway explains why, historically, there has been very little pick-up tonnage over previous years of operation undermining efficiency and contributing to a lack of any profitability."
So understand this we need to understand that most flights to Manston were full and most flights out were empty. In 2013 this for reference, there were 511 air freight ATMs at Manston, accounting for 29,306 tonnes of freight. The 747-400F can carry 105 tonnes so assuming most were full 300 flights either landed or took off with an average load of 95 tonnes.
The total annual UK weight of cargo carried by dedicated air freighters 715,000 tonnes (at 2016 levels source CAA);
Therefore assuming by year 6 RSP (Sally Dixon's figures) 10000 ATM's will be reached and assuming every flight landed full and left empty then by 2016 Manston would achieve a total tonnage of  475000 tonnes which is 2/3rds of the total tonnage of dedicated freighters. Absolute rubbish.
 The Ramsgate Society has done extensive research into Manston and its problems however what seems to come out of this is someone is embellishing the true position. If you look at Sally Dixon's figures below they envisage a freighter carrying an average of  18 tonnes of cargo whereas a 747-400F can carry 106 Tonnes an absolutely massive difference.

The last point which will put the final nail into this coffin is the cost of reinstating the airport. Various figures have been bandied about but according to Dr. Beau Webber this is around £300M. As an accountant and Financial Adviser for more than 25 years this business model will make the airport noncompetitive and inflexible because this amount will incur repayments of both Capital and Interest costs which landing fees and ancillary business will have to cover before running costs. As an example check out the Channel Tunnel which had similar issues and escaped from its financial dead weight by going bankrupt.

FYI Julian Eagle

Is this the level of debate that gets your ego stroked then Julian?

There is an advantage of living where I do. Red Arrows performing at the end of Cowes week