Vienna Invests in Cargo while AUA develops Intercont Network

The Austrian airport has decided to expand its air freight facilities. Clearly VIE hopes to enhance its appeal as a cargo hub and offer carriers and their customers better conditions for throughput and handling of shipments. In the meantime volumes transported in the holds of the Austrian Airlines fleet are increasing again.

In view of rising volumes Vienna Airport decided to invest in cargo infrastructure  -  courtesy VIE
In view of rising volumes Vienna Airport decided to invest in cargo infrastructure - courtesy VIE

Last year, cargo volume at Vienna Airport grew by two percent, reaching a total of 273,000 tons. This includes imports and exports unloaded or loaded on board aircraft at the airport as well as road feeder services, ergo goods that arrived by truck from the Balkan countries or Northern Italy and went on to other destinations, particularly Munich, Frankfurt and Zurich, after being handled at VIE. In this case, Vienna served as an intermediate stop for consolidating and deconsolidating goods by local ground handling agents, before they continued their voyage to other places.

Now, the management has decided to invest €16 million ($18.3 mn), to both upgrade and enlarge the handling area. This will add 13,000 square meters of handling space to the 30,000 sqm already there.

Air freight is becoming increasingly more important to the Austrian economy
The expenditure in cargo is part of a master plan, comprising of €500 million ($573mn) to improve the ground infrastructure at Austria’s prime international gateway and make it more competitive and to prevent falling behind its state subsidized competitors in the Gulf region and Turkey with their impending giant Black Sea project. The spending is justified by VIE management, referring to the increasing importance of air freight to the Austrian economy and the expected continuous growth of air transport. Placing the contribution of road feeders aside the tonnage flown directly at VIE increased by impressive 15 percent last year.

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AUA is getting back on track
One of the main contributors is flag carrier Austrian Airlines, despite the fact that the Lufthansa subsidiary had been going through a period of strong head winds lately, caused by the loss of important markets in Russia and Eastern Europe. On these routes passenger numbers dipped sharply as did the cargo volumes in reaction to Russia’s annexation of Crimea and the Moscow supported insurgency in the eastern parts of the Ukraine. A victim of political decisions and military action, AUA had no choice but to sharply reduce flights between Vienna and Russia as well as some of the CIS countries. Since there is no end in sight of the crisis, the airline’s management changed course, concentrating on leisure destinations and long-haul routes. This strategic shift obviously paid off, as seen by the €54 million EBIT ($62mn) reached in 2015, up €34 million ($39mn) from the previous year.

In fiscal 2016, AUA CEO Kay Kratky expects further growth in passenger numbers and cargo volume, even though freight is not his concern, because Lufthansa Cargo exclusively sells and manages AUA lower deck capacity. After adding Colombo, Mauritius, Miami and some medium-haul routes to its network last year, on April (5 times weekly) flights to Shanghai began which are now operated daily as of yesterday (May 1), to be followed by Hong Kong and Havana next fall.

Additional long-haul operations will up the cargo volume flown by AUA and simultaneously the tonnage handled at Vienna Airport, much to the delight of the local ground handlers and VIE’s managers.

Heiner Siegmund  /  Michael Taweel

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