BSR Accessibility & Air Cargo
Tallinn,
15-16
October
2013
Presented
by:
Anatoli
Beifert
www.bal&caircargo.net
www.eu.bal(c.net
Date:
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Avia&on
Wright
Brothers
They were not -irst men to -ly
They were -irst men who successfully landed
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Real
GDP
&
Air
Trac
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Real
GDP
&
Air
Trac
Source: Air Transport Association and Worldwatch Institute.
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World
scheduled
airline
nancial
result
(USD,
bill)
2012/02/15
2012/02/15-2012/02/16
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World Air Travel and Freight Carried, 1950-2012
Source: Airlines for America
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Jet Fuel Prices, 1990-2012
2012/02/15
2012/02/15-2012/02/16
Source: US Energy Information Administration
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Operating Revenues of the Airline Industry
2012/02/15
2012/02/15-2012/02/16
Source: ATA Annual Report 2005
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World airlines return on invested capital
Source: McKinsey & Company for IATA
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World airlines return on invested capital
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Average ROIC 2004-2011
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Economic profits in the air transport value
chain 2004-2011 (excluding fuel and labour)
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ROIC for Airports vs. Airlines
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ROIC for Services vs. Airlines
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Bileteral System of Aviation
Barriers to entry are relatively low
Barriers to exit are very high
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Bileteral System of Aviation
Bilateral restrictions prevent the
consolidation that would otherwise
be expected in markets that are
very competitive and protect
inef-icient incumbents in markets
with only a few players
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Bileteral System of Aviation
Highly competitive nature of the
airline industry leads to a
downward pressure on prices
Exacerbated by the perishable
nature of airline seats and the low
marginal cost of -lying an
additional passenger
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Good News
Low returns have not stopped
airlines from growing in the past
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Air
cargo
volumes
in
BSR
15.10.13
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Air
cargo
in
BSR
15.10.13
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BSR accessibility and the role of air cargo
Major aviation hubs of the BSR have significant influence on
the accessibility of the BSR:
these hubs offer the intercontinental connections
and regional flights inside the BSR area go via hubs.
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Air Cargo outbound BSR
Source: Baltic.AirCargo.Net 2013
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Air Cargo inbound BSR
Source: Baltic.AirCargo.Net, 2013
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Estonia. Air Cargo Outbound
Source: Baltic.AirCargo.Net 2013
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Estonia. Air Cargo Inbound
Source: Baltic.AirCargo.Net 2013
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Estonia. Air Cargo Forecasting
Forecast!*!air!cargo!demand!handled!at!Tallin!Lennart!Meri!Airport!(EETN)!(Pr>0,1;!k=0,38)!
scenario!
optimistic!
most!likely!
conservative!
2011!
2012!
2013!
2014!
2015!
2016!
20,7%!
53,6%!
0,0%!
23,3%!
30,2%!
0,0%!
17,4%!
4,30%!
0,0%!
13,7%!
6,71%!
0,0%!
13,5%!
6,29%!
0,0%!
13,0%!
5,92%!
0,0%!
Source: http://www.tallinn-airport.ee
Baltic.AirCargo.Net 2013
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Finland Airports activities - outbound
(2005-2011)
Source: Baltic.AirCargo.Net, 2013
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Finland Airports activities - inbound
(2005-2011)
Source: Baltic.AirCargo.Net, 2013
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Role of Air Cargo Finnair Exapmle
Majority of Finnairs revenues comes from EuropeAsia traffic
Air cargo revenues represent 20 % of Asian revenues
Distribution of passenger and cargo revenues in scheduled traffic
(Q4/10)
Domestic
Europe
Asia
US
4%
4%
48%*
52%*
Source: Finnair
AsiaEurope
Via
Helsinki
>60 %
12%
10%
36%
34%
* Cargo revenues represent 20% of Asian revenues
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BSR accessability, role of aviation hubs
Intercontinental flights are dependent on feeder traffic and vice versa:
passengers are flying
and cargo is transported by flying trucks, i.e.
Road Feeder Service
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Bal(c
Sea
region
Programme
2007
2013
ERDF
Funds
30
Road
Feeder
Service
Flying
Trucks
Most suitable concept for air cargo
business for regional airports
Formally Flying Trucks are treated and
handled as real aircrafts
Cargo transported by Flying Trucks is AIR
CARGO (de jure & de facto)
Flying Trucks fulfill all custom and security
rules as if the goods were really flying set
by the authorities.
Special treatment of flying trucks on crossborder points (e.g. BY-EU or RU-EU)
Air cargo, CPH, 2011
7%
35%
26%
32%
Flying
Trucks
Cargo
A/C
Source: Hans Christian Stigaard
Former VP and Traffic Manager at CPH
15.10.13
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WP3
:
AIR
CARGO
-
Analysis
Air-Road
Intra
European
Market
2007
(ying
trucks)
Source: Boeing 2008
15.10.13
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WP3
:
AIR
CARGO
-
Analysis
Air-Road
Intra
European
Market
2011
(ying
trucks)
Source: Boeing 2011
15.10.13
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China
Rail Road COMPETITION EXAMPLE
Customs Union (BY, KZ, RU)
EU
Since 1st July 2011 customs control on internal borders of Russian
Federation, Republic Kazakhstan and Belarus was canceled.
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Urumchi
-
Parchim
15.10.13
2012/02/15-2012/02/16
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Des&na&on
rou&ng
overview
15.10.13
2012/02/15-2012/02/16
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Case
study:
BJS
FRA
(via
SWZ)
15.10.13
2012/02/15-2012/02/16
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DB Schenker Cargo train: Chongqing Duisburg
operating since April 2011, 11.179 km in 13 days via train
Bild/Grafik
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New Challenges
Background
New EU air cargo framework EU aviation security validations in third countries
The framework requires (subject to exemptions) air carriers carrying cargo or mail from an
airport in a third country for transfer, transit or unloading at European airports, to be
designated as an 'Air Cargo Mail carrier operating into the Union from a Third Country
Airport' ("ACC3").
In order to be designated as an ACC3, the carrier must implement certain security controls
and before 1 July 2014 submit a declaration as to its compliance with security requirements,
and from 1 July 2014 onwards be EU aviation security validated.
Operational goals
Raise the level of third country security (to EU standards) from from third countries
Minimise the burden of the new measures on the EU air cargo industry
Reduce the impact of the new measures on EU appropriate authorities
Ensure that there is a level playing field across the union ; and
Achieve rapid implementation - fully operational by July 1 2014
ACC3 Designation
No ACC3
designation
required
Airport in a third
country listed
with Security
Measures
equivalent to
those of EU
Appropriate Authority
which issued AOC
Air carriers
holding an Air
Operator's
Certificate (AOC)
issued by an EU
MS
Air carriers not
holding an Air
Operator's
Certificate (AOC)
issued by an EU
MS
ACC3 Designation by
Appropriate Authority
Based on:
Appropriate Authority of
Member State listed in
Regulation (EC)
748/2009 (as amended)
Appropriate Authority of
Member State where air
carrier has its major
base of operations in EU
(where Member State is
not listed in Regulation
(EC) 748/2009 or any
other MS with
agreement
1.
Nomination of person
responsible for
implementing security for
relevant cargo operations
2.
Declaration of Commitments
(until 30 June 2014)
3.
EU aviation security
validation report (by1 July
2014, unless designation
extended for objective
reasons [not more than 3
months unless ACC3 applies
an internal security quality
assurance programme]
Cargo & Mail
transported
by Air
Carrier
ACC3
designation
for up to 5
years
ACC3 validation
can be at
representative
number of
airports
EU
Can
transport air
cargo & mail
into every
Member
State
EU
ACC3 given
unique
alphanumeric
identifier and
details entered
into Union
database of
regulated agents
and known
consignors
X
EU
Airport in a third
country
Carrier cannot
transport cargo
or mail into the
Union
No designation
obtained
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ACC3 Timeline
Timeline & High Level Requirements for implementing the new ACC3 Regulation
Milestones
February 1,
2012
November 9,
2012
January 31,
2013
June 30,
2014
Commission
Deadline for MS
Implementing
to demonstrate
Regulation (EU)
how they
No 1082/2012
contribute to the
of 9.11.2012,
implementation of
amending
EU aviation
Commission
security validation
Regulation (EU)
requirements
No 185/2010 of
recruitment,
4 March 2010 in
training and
respect of EU
oversight of EU
aviation security
aviation security
validation
validators
ACC3 Designation based on Declaration of Committments
Commission
Implementing
Regulation (EU)
No 859/2011
establishing the
ACC3
framework
effective 1st
February 2012
July 1,
2014
Designation as
ACC3 must
take place on
the basis of an
EU aviation
security
validation report
unless extended
for objective
reasons
June 30,
2015
Commission to
assess,
evaluate and if
necessary
make a
proposal
June 30,
2016
End of MS
extension of
designation
without
validation for
objective
reasons
ACC3 Designation based on EU aviation security validation (*)
Actions
Designated ACC3s must be entered into the Union Database of Regulated Agents and Known Consignors with unique identifier
ACC3 must maintain a database of validated RAs and KCs
ACC3 must issue security status declaration
Aviation security controls implemented by ACC3s must meet ICAO standards
ACC3
or
avia&on
security
validated
RA
must
issue
security
status
declara&on
ACC3
must meet requirements of the New ACC3 Regulation
(*) Proof of screening to EU Standards to be provided by previously validated entities not meeting this requirement
41
China
ransit times vs. costs before 2011
Source:
LAND TRANSPORT OPTIONS
BETWEEN EUROPE AND
ASIA:
Commercial Feasibility Study
July 2010
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China
transit times vs. Costs after 2011
rail
Source:
LAND TRANSPORT OPTIONS
BETWEEN EUROPE AND
ASIA:
Commercial Feasibility Study
July 2010
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BSR accessability, role of hubs
BSR accessibility is heavily dependent on hub and spoke transport
system
Most of the remote areas of the BSR could not reach the same
accessibility (number of destinations, frequencies, transport cost
level) without hub and spoke model:
Maritime:
Container hubs (e.g. Hamburg) offer oversea (intercontinental) connections
and feeder traffic (e.g. Short Sea Shipping) is the spoke between the hub and
the hinterland
Aviation:
Aviation hubs (e.g. CPH) offer intercontinental connections and feeder traffic
(e.g. flying truck, RFS) is the spoke between the hub and the hinterland
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Conclusions
The BSR transport policy should recognize the link
between air cargo and the BSR Accessibility much more
stronger than it does today.
Aviation both airports and airlines are facing strong
competition and the BSR region should utilize
possibilities offered by air cargo
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Conclusions 2
Short Sea Shipping highly recognized concept, respected
in transport policies
RFS / Flying Trucks Trasport Policy
Nowdays very few regional airports in BSR utilize the Road
Feeder Service.
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Conclusions 3
Regional Airports:
We do not know, what we do not know...
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If God had really intended men to -ly, he'd make it easier to get to the Airport.
George Winters
Thank you!
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