When the Hesse Administration High Court in Germany put an end to scheduled night-time flights at Frankfurt Airport, the news came as a big blow to Lufthansa Cargo. The carrier had planned for 10 night flights on its winter schedule, beginning October 30.
Karl Ulrich Garnadt, chairman of the executive board and CEO of Lufthansa Cargo, sees the resulting consequences for the carrier as "quite severe". "We don’t know how our customers will react, but we expect a double-digit impact," he says.
Mr Garnadt sees the provisional night-flight ban in Frankfurt as a drastic signal for the German logistics industry. "As an export world champion, Germany is reliant on dependable connections to ship air freight to destinations around the globe," he says. "Frankfurt Airport plays, in that respect, a highly important role since about 40% of German exports are transported by air."
Mr Garnadt also predicts the decision will impact companies in Frankfurt and the Rhineland industrial area that depend on night flights to give them a competitive logistics solution. "By losing night flights, the quality of Frankfurt as a logistics hub will have an impact on investment decisions by companies,” he says.
Airports are economic drivers, and those handling cargo are powerful engines for local economic growth, particularly in attracting manufacturers and logistics operators who depend on fast transport service.
This fact is so poignant that Dr John Kasarda, a professor at the Kenan-Flagler Business School at the University of North Carolina at Chapel Hill, has named the concept 'Aerotropolis' to describe an aviation-oriented economic region that has an airport as its cornerstone. Two cities in the US exemplify this point: Memphis, Tennessee, home to Federal Express; and Louisville, Kentucky, the world hub for UPS.
FedEx serves customers and businesses worldwide, and its Memphis hub has made the city a magnet for businesses that thrive on time-critical transportation. From Memphis, FedEx can deliver to any North American location within 24 hours and to most major global cities within 48 hours. Among the companies locating to Memphis to capitalie on these advantages are Johnson & Johnson and Pfizer. Both have major logistics centres in the city.
Zappos.com, one of the largest online shoe stores in the world, moved its fulfilment centre to Louisville in 2006 to be close to the UPS hub. Dubbed 'Worldport', the hub currently turns over 130 aircraft and processes about 1.5 million packages a day.
"From there, and with the help of UPS, we were able to serve areas with population density, and the US lower 48 states, with next-day or two-day delivery," says Craig Adkins, Zappos.com vice-president of services and operations. As a result, Zappos' sales grew from $597m in 2006 to $840m – an impressive 40% jump.
Nevertheless, Mr Kasarda points out that airports in the US are treated as nuisances to be controlled, unlike their counterparts in Asia and the Middle East where they are regarded as primary infrastructure assets for their cities and countries to compete in the globally connected, speed-driven economy.