MIA’s cargo and mail volume increase of 25 per cent in February over that of last year (TMID, 5 March) is an impressive figure but somehow was passed over in the general media, as focus seems entirely on incoming and outgoing tourism. Certainly this is more glamorous than parcels and palettes. Nevertheless, air freight is very relevant for the economy in general, particularly given Malta’s island status.

A strong air cargo sector is an indicator of a healthy economy, and both e-commerce and the development of high-value industries/services in Malta for export will surely increase volumes, but opportunities also lie beyond the local market.

The following first addresses the present situation and will then aim to cover points that MIA mentions in its cargo development policy, as well as other points with exemplary scenarios.

Existing links

The most important cargo airport for Malta is Frankfurt and not without reason. There is on the one hand the largest bilateral market, but also Frankfurt’s role as European cargo hub No 1.

The Frankfurt full-freighter run has a very long tradition. Although today it is operated by a European Airtransport / DHL Boeing 757 for Air Malta, it has existed since the days of German Cargo’s DC-8s. Clearly, bilateral industrial developments have facilitated this service, and concurrently have been aided by it. Free “roadfeeder” services are offered: cargo given up / destined to various air freight depots in Germany and the West Cont area is trucked to Frankfurt for free. The service also carries cargo that does not fit in the normal passenger airliner belly. Frankfurt offers a central West Cont position and global market strength.

The greatest share of the Frankfurt cargo consists of so-called belly-cargo, thus carried in the baggage/cargo hold of regular passenger airliners (for Malta generally A320 narrow-bodies). If there is a bigger than usual load to carry, anything from industrial goods to perishables, Lufthansa occasionally sends a wide-body Airbus A300, particularly if it coincides with high passenger demand (e.g. holidays either in the area of Germany or in markets connected with Malta via Frankfurt, like Scandinavia).

Given the vitality of Frankfurt for both passenger connections and cargo/airmail, forking out fat subsidies to help parallel flights that damage the Air Malta and Lufthansa services would be no step forward. Deteriorating passenger numbers could lead to higher freight rates in compensation, or services would have to be cut: no plus. A certain low-cost-at-any-cost airline refuses cargo, already deterring checked luggage, making good sense for their leanest possible operation. Other no-frills airlines are open for cargo, while holiday carriers try to participate in the market too. Yet whether routes are as interesting cargo-wise as those offered by Air Malta and network carriers, both as regards destinations and/or frequency, is another question.

Malta-UK is also a relevant market, though not as strong as Germany.

The frequent wide-body Emirates flight to Dubai is an excellent addition for Malta, especially with regard to Asia and Australia, facilitating quite bulky goods and big quantities.

Italy has long seen Malta freighter flights. Air Malta and DHL had launched a workdays B727 freighter run back in 1997 (ca. 15-18 tons capacity) from/to Milan-Bergamo, a hub offering both air and roadfeeder connections in Italy, the West Cont area, and beyond, providing daily capacity for on-deck palletised cargo (hence also bulky items). But one was too ambitious: services ceased after some time. Some years ago a new frequent service from Rome was launched using a smaller turboprop plane (Fokker), taking about five tons of moderately sized cargo. Given economic development, one can believe in a more stable future just thinking of increased just-in-time production and e-commerce.

Regional sourcing

MIA mentions extending the local market to Sicily, Libya and Tunisia. What could that mean concretely?

A regular roadfeeder to/from (eastern/southern) Sicily might make use of the good ferry connections. Larger quantities of air cargo to/from Sicily, instead of being trucked up the long way north to places like Rome or Milan, necessarily also partly by ferry, would then go to incomparably nearer Malta for further transport. The Emirates Dubai run and Air Malta’s Frankfurt services might be particularly interesting.

As regards international airlines linking Benghazi, Air Malta basically holds a monopoly (with Cairo and Tripoli very far away and Cairo having no practical choice regarding roadfeeder). While Tripoli is certainly a larger market, this route should also be promoted as regards belly cargo transhipped via Malta.

It should however be very difficult to compete for the Tunisian market against Tunis and Tunisair (widebody Airbus A300s for key routes at high frequency and diversified network).

Switching between

sea and air modes

“MaltaModal” is mentioned as a further pillar of MIA’s cargo development strategy.

Intermodal transport has goods switching their mode of transport, remaining in the same containing device. There is primarily the classic container for sea-land transport. A big Italian firm for land-based intermodal transport is Ambrogio, operating throughout western and south/western Europe: trailer bodies are swapped between truck and railroad wagon at logistics terminals. This is a fixed logistics chain, like for the auto industry. It clearly does not apply as regards Malta, a major consolidation point exclusively for one mode (sea).

The modality switch field for Malta should be ad-hoc cases combining sea and air transport. Both modes differ strongly with regard to speed and cost, as do value and particularly weight of freight: combinations are usually not planned. Yet the key is the proximity to the Freeport and Grand Harbour.

A possible scenario: due to some time problem an item on board a ship (or in a container) has to be at its destination much faster than planned, e.g. on a trip from Europe to Asia or vice-versa. This can be anything from a spare part suddenly needed more urgently than planned to keep a vital operation running to avoid standstills, or parts for some global supply chain, which are necessary to avoid very costly production standstills. Items could be offloaded from the ship, quickly transferred to the airport, and re-loaded either on to a scheduled or chartered flight. The vice-versa goes for cargo that missed a ship but which is facing a very high delay penalty.

While certainly avoided if possible, with increases in container volumes due to global economic growth, more complex production and sourcing facility networks, and just-in-time production and delivery, such incidents are bound to increase, and Malta is the ideal point to “fish out” cargo.

There might be cases where air/sea combinations are planned from the start, e.g. cargo destined for a place in Saharan or central Africa not easily accessible by road. Items could first be taken to Malta by sea container or truck, and flown the rest of the way, possibly cheaper than flown all the way.

Thus what MIA and the Maltese maritime sector rightly aim at is creating awareness of the possibilities offered with two big seaports and the airport located within a few thousand metres of each other. Directly competing seaports (like Gioia Tauro) are not that near to airports (meaning higher transfer costs, and, in case of outsized cargo, substantial extra time); and these often cannot handle any large cargo aircraft (Boeing B747 / Antonov 124) without problem, contrary to Malta.

Malta as transhipment

centre

Dormant potential lies in the general transhipment/ consolidation with regard to Africa; after all the stream of flown goods crossing the Med is primarily Europe/Far East and North America or Asia to Africa and not Israel/Turkey to Spain. Southbound mostly technical equipment is carried, northbound primarily perishables, but increasingly at least as regards RSA also industrial goods.

MIA has identified primarily the Europe, Middle East and Asia to Africa and Europe to Middle East trade routes for transhipment potential, marking the possibilities opened by MIA’s own development projects, which add to Air Malta Cargo Systems’ centre established in the early 1990s in the old passenger terminal.

However, between Europe and the Middle East there should already be quite some capacity in the market, with ambitious Gulf carriers and dedicated freighter services.

Yet only a limited number of airports in sub-Mediterranean coastline Africa outside the RSA can already technically be considered for a mini-hub, and these might not be so well located for African routes, time/fuel-burn wise. MIA offers a 24-hour operation, low landing and parking fees, highest runway system standard, apart from other advantages. Certainly Cairo, Addis Ababa and Nairobi compete fiercely over being the crossroads as regards Europe and particularly the Middle East and Asia from/to Africa, but for example, Kenya has just proven that political stability cannot be taken for granted. UAE airports are expanding aggressively with regard to Africa too. Competition is tough.

In a scenario, two (or more) cargo planes from/to an according number of different African places with cargo destined to different places onboard would swap parts of their loads in Malta and continue either to the Euro places (which of course could also be done by a direct roadfeeder from a continental airport, thus limited opportunity), or one Euro and one Near/Middle East (where roadfeeder is useless; here Malta’s position is beneficial), or, theoretically, even an North American or Asian place.

One should avoid having too great expectations: for the belly-cargo market there are regular flights with Air France, Lufthansa, Brussels Airlines, TAP, British Airways, South African and Ethiopian around; Emirates also has to be reckoned with. But for the full-freighter market with specialised low-cost operators maybe there is a chance. Particularly interesting are African carriers operating from different African countries to different destinations in Europe and elsewhere. Unfortunately, DAS Air Cargo ceased operations. MK Airlines with its B747s and DC8s might be a partner.

In general, one has to look at operators/networks for whom not just Africa-Europe but also Africa-Near/Middle East and Russia/Asia are important, or, as regards Europe, are focused not just on one area but on several: establishing Malta as an air cargo crossroads between Europe, Africa, the Middle East, Asia and Russia.

Military charter

After creating awareness and getting into business with the key Antonov 124 operators flying outsized civilian cargo (130-150t capacity) to Africa (from telecom equipment to exploration equipment to power station components), Malta is seeing these firms in the general military support charter field for peacekeeping or catastrophe relief missions. Being Europe’s southernmost tip makes Malta an attractive refuelling point: no stops in politically problematic areas with insufficient infrastructure.

As an example, Antonov charters for the German Bundeswehr, temporarily based in Kinshasa to help maintain security during the elections, staged through Malta, routing Germany-Malta-Kinshasa. It speaks for the standard and low costs offered when flights stop at a commercial airport rather than at Nato partner’s bases in the immediate neighbourhood. Recently, there apparently were flights for the Austrian Forces to Chad/Darfur (Linz-Malta-N’Djamena). Mostly it concerns smaller forces lacking strategic airlift capacity.

Low-fare Africa / South America flights –

a missed chance

Finally, while the following is primarily concerned with passenger travel, it will show that Malta had missed a great cargo opportunity a decade ago. Today it sounds unbelievable what happened, but it is still interesting to recall the case.

Aeroflot had, during the mid 1990s, presented Malta with a one-time opportunity to develop into a hub for low-fare passenger flights between western and southern Europe and Africa and South America.

In June 1998 Aeroflot even launched a non-stop flight Luqa-Buenos Aires (beginning and ending in Moscow) with the new Il-96 long-haul jets, greatly advertised in Maltese papers and very interesting for Italy with the large community of Italian origin in Argentina. Additionally, one already had links to numerous places in Africa’s Atlantic coast area.

Definitely all places had zero value for Malta’s tourism, and for most routes there was no sufficient point-to-point volume even for Russia. So where was the opportunity?

Aeroflot carried not just the few Russia-Africa passengers, but also Russian tourists to Malta on the Moscow-Malta leg. In Malta the tourists disembarked for their holiday, leaving empty seats behind. The hubbing opportunity was that the then vacant seats could have been filled with passengers for Argentina or Africa arriving via Air Malta’s western European and Italian network, and vice-versa.

Aeroflot could have made their flights viable and more stable, which could also have improved frequency. Air Malta could have filled empty seats from numerous Western Europe and Italy sectors on a year-round basis, helping to keep more routes/frequencies open, benefiting tourism and company coffers. All would have been entirely non-cannibalising on existing flights. The airport would have profited.

Sure, maybe initiative from Aeroflot was missing, or Air Malta had other things to worry about those days (Avro), or promoting authorities did not see the potential, and they were hard days for Aeroflot re-organising with economic instability in Russia, and maybe the airport was not pushing it. A problem was the fortnightly rhythm of the Africa runs, which did not help demand, yet had its cause just in the low demand resulting from limited volume/lacking Euro feeders. There were no east/west barriers hindering cooperation: the quoted 1997 schedule showed that US giants American, Continental, United and also Qantas and Lufthansa had no problem working together with Aeroflot for connections. Aeroflot needed Air Malta as marketing and feeding partner, and certainly traffic rights between Malta and the other countries.

But at least the traffic/marketing rights issue was no problem: the Aeroflot summer schedule of 1997 had a Malta flight for two key airports, Accra/Ghana (large ethnic communities particularly in Italy and Britain), Lagos/Nigeria (relevant both for business (oil!) and ethnic travel from various European countries) as well as niche market Cotonou/Benin on sale. The Buenos Aires non-stop run was widely advertised in Maltese English-language papers: no traffic rights problem either. Additionally, Aeroflot operated (without sale opportunity) flights interesting for hubbing via Malta to/from: Douala/Kamerun, Luanda/ Angola, Brazzaville/Congo, Lome/Togo, Dakar/Senegal and Conakry/Guinea.

Aeroflot later gave up most routes. Indeed, who would fly from for example Rome first to Moscow and then fly, with a fuel stop in Malta, to Buenos Aires, or Milan-Moscow-Accra, Amsterdam-Moscow-Lagos? Travelling with a quick transit in Malta down south would have been ideal, saving time and money.

Africa routes make good money for European (non-stop) carriers, Royal Air Maroc, and now also Libyan carriers. Rising from flight embargo ruins, Tripoli, only 200 nautical miles south of Malta, so interchangeable, is developing dynamically with this traffic; see Afriqiyah’s (A320, A330, A350) and Libyan Arab’s impressive aircraft orders. Particularly Afriqiyah (www.afriqiyah. aero) specialises in flights to key European cities during the day with onward connections way down till the Gulf of Guinea (and planning beyond) during the night, maximising aircraft utilization. By offering both moderate fares and a generous baggage allowance they can be successful. Experienced European carriers make good profits on these routes. Emirates developing Africa as a key growth market should be a further proof of the opportunities recognised.

So what has this lost in an article about developing air freight in Malta?

Together with improving passenger load factors on Euro routes by making Malta into a mini-hub for low-fare flights aimed at Africa and partly even South America, this could also have been a super opportunity to put Malta on the map regarding cargo to Africa, generate belly-cargo revenue for both partners, which would have improved route profitability, thus also stabilising further Euro routes – and tourism could have profited from this too.