St. Petersburg Starts Cargo Incentives

At North-West Russian St. Petersburg Pulkovo Airport cargo carriers are granted discounts if doing biz there. Through this financial leverage the management hopes to attract foreign freight airlines and up the tonnage substantially. However, the well-intended plan might fizzle out should the local customs people not adapt to modern practices.

Loading of Swiss passenger aircraft at Pulkovo Airport  /  source: LED
Loading of Swiss passenger aircraft at Pulkovo Airport / source: LED

Pulkovo ranks currently fifths among Russia’s airports by cargo throughput. Last year, 31,395 tons were handled there, a rather meager plus of one percentage point to 2012. And not a figure though, to frighten 400 km distant Helsinki Vantaa airport to lose biz where last year 187,000 tons were flown in or out.
Those are the bold facts.
When asked by CargoForwarder Global how to possibly get a larger chunk of this portion operated via foreign competitors Pulkovo’s management points out that a great number of the Helsinki handled goods, which also accounts to a lesser scale to Riga in Latvia and Tallinn in Estonia, are destined to importers in the north-western parts of Russia – thus the natural backyard of St. Petersburg. 

Pulkovo’s discount strategy
This clearly means that sufficient tonnage is there as statistics prove but most of these goods circumvent Pulkovo so far and arrive instead at Helsinki, Tallinn or Riga from where they are trucked to their final destination in the regions surrounding St. Petersburg.
But how to attract additional all-cargo airlines to bring in more goods or lure away part of the Helsinki and Riga handled tonnage? Pulkovo’s stunning answer: By offering cargo carriers substantial discounts when guaranteeing to land at Pulkovo at least once a week. If done more often, they can save even a larger amount of money.

Financial stimuli
The landing fees payable by airlines can drop by 45 percent, confirms the management, which in this case means that carriers would have to pay only 142 rubles (1.98 euros) per ton calculated on the total landing weight of the aircraft. An incredible low fee compared to charges levied by airports like Helsinki or Riga.
These and some more financial incentives are granted if a given cargo carrier serves St. Petersburg at least once a week. In case this happens more often, the charges will even be less. Currently, Korean Air Cargo is the only non-Russian airline operating freighter aircraft constantly to Pulkovo. All other carriers landing at St. Petersburg transport shipments in the holds of their passenger aircraft. 
This might change, however. The financial leverage announced by the management could indeed attract a number of foreign capacity providers to regularly service Pulkovo. The aim of the management is to bring in Middle East players such as Emirates Sky Cargo or Turkish Cargo, to name just two candidates listed as potential candidates. The same accounts for domestic AirBridge Cargo and some unspecified carriers from the Far East.

Customs is the big obstacle that needs to be overcome
Before their cargo dreams come true the Pulkovo exects will have to speak some very frank words with the officers of their local customs. It’s an open secret that they are bureaucratically cumbersome by tradition and there are no signs on the horizon that they are willing to change their sluggish and inflexible way of acting. Local forwarding agents confirm that it takes often up to three weeks to get their Asian or European imports cleared that arrived at Pulkovo. An unbearable situation, torpedoing all plans to convert the airport into a modern und efficient place to handle cargo according to international standards.
Having said this it comes not as surprise that most shipments destined to clients in Russia’s North-West are landing in Helsinki, from where they are trucked to the importers. Export-wise, St. Petersburg has little to offer for convincing cargo airlines that it could be financially attractive for them when serving the airport.
So it remains to be seen what consequences the lowering of fees and other incentives offered to cargo airlines when landing at St. Petersburg will ultimately have. We’ll keep an eye on it!


Heiner Siegmund

Airlines’ percentage in general volume of carried cargo, 1st half of 2014, %

Source: Pulkovo Airport
Source: Pulkovo Airport

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