Next to cargo-partner’s latest iLogistics addition to the Slovenian airport, what other developments are on the horizon for the aerodrome located at the heart of trans-European crossroads?
What’s the outlook for Ljubljana at the moment?
According to Fraport group traffic figures published on their website, whilst passenger figures at the airport look healthy (and this despite recent problems this summer with LJU’s largest customer, Adria Airways), LJU cargo figures have been struggling a little this year, with a year-to-date (AUG 19) cumulative decline of -5.4%. In recent years, however, LJU saw “tremendous growth” according to operator Fraport Slovenia, and the overall trend is expected to continue.
Unions complain about Fraport Slovenia’s disinterested attitude
Added to this, a strike warning issued at the end of AUG 19 by the three unions representing employees at Ljubljana Jože Pučnik Airport, that strike actions are planned for October or November if workers’ salaries are not increased nor working conditions improved, may jeopardise smooth operations towards the end of this year. In the warning published in exyuaviation.com on 28 AUG 19, the unionist David Schwartz pointed to hopefully positive wage increase negotiations with management in the following weeks, but also stated at the time that the airport operator, Fraport Slovenija which purchased a 75.5% stake (€177.1 million) in Ljubljana Airport in 2014, and has since also bought the remaining shares (another €57.3 million), had so far shown little interest in meeting the demands of its employees. In response to the union demands of a 12% increase in salaries (to be adjusted annually to compensate inflation), along with performance-based bonuses and more extra pay for Sunday work, Mr Schwartz was quoted as saying, "The German operator has shown an unacceptable attitude so far. They need to realise they are doing well in Slovenia, which is illustrated by the millions being invested in airport infrastructure. However, they also need to understand they must invest in people too."
To date, Fraport has not provided an official reaction to the strike warning.
More developments at Ljubljana Airport
Indeed, Fraport has since opened an Aviation Academy facility at the airport and has invested in a new passenger terminal due for completion in the summer of 2021. After a record number of passengers in 2018 (and rising), Fraport also announced that it will be modernising the airport’s logistics and IT infrastructure.
When CFG asked what possible effects the new terminal would have on cargo movements, Fraport replied “Bigger and more modern facilities are going to improve our possibilities to attract bigger aircraft to the airport. Bigger luggage compartments could have a positive impact on the amount / volume of air cargo.”
Integrators play an important role
Forwarding agent cargo-partner are not the only ones to invest in Ljubljana Airport recently. K&N opened a pharma center there in DEC 18, and Fraport reported to CFG that a number of express air cargo carriers (Fedex + TNT, UPS, DHL) as well as other large logistic companies are working on moving their business to LJU, thus consolidating Ljubljana’s position as an important airfreight hub for SEE region. Concretely, Fraport is currently negotiating further business expansion with DHL and UPS.
As regards its own cargo infrastructure, Fraport reported to CFG that they are in the process of analysing its future development, given the high growth in cargo traffic in recent years and the trend being expected to continue: “The capacities of the cargo terminal are full, and the biggest challenges are caused by cargo volumes in peak days. Expansion of the warehouse at the existing site is not possible due to spatial restrictions, therefore we are in a process of selecting the most appropriate scenario for cargo infrastructure development. We are about to bring a decision about this investment soon.”
Tough competition at the heart of Eastern Europe
Fraport Slovenia sees six other regional airports as its direct competitors: Venice, Treviso, Trieste, Zagreb, Klagenfurt and Graz, and constantly strives to market and improve the airport’s competitive advantages. When it comes to cargo, Zagreb is the main competitor and Fraport’s mid-term goal is to remain in the lead as the region’s cargo airport. “In terms of cargo, future development to a great extent depends on adequate facilities for cargo handling and warehousing, as well as of proper logistical positioning of all cargo players at the airport and about connection to other means of transport and infrastructure (road and rail network).”
“In the field of air freight, we hold a competitive position and are one of this region’s leaders. Offer and demand in the field of passenger traffic are primarily not run by airports, but in the field of air freight we hold better cards. Our Geo-position is good, our infrastructure is even better and growing. But our solutions and versatility of our services in the field of air freight is at top level. All of beforementioned and the potential of the land available makes us look into our air freight future with good expectations.”
Neither Brexit (UK is a key passenger destination ex LJU) nor the recent Klagenfurt Airport billion-euro expansion plans pose any great threat to the airport, according to Fraport Slovenia.
Fraport Slovenia prides itself on being one of the most efficient and flexible airport operators, despite a competitive budget, and certainly there is a lot of movement in terms of further site and business development. Whether or not the union strike warnings will cause short-term turbulence, remains to be seen.