As the U.S. home base for Amazon Air and DHL Express, Cincinnati/Northern Kentucky International Airport (CVG) moves large volumes of express shipments. Now the airport is positioning itself to attract general cargo carried by passenger and freighter operators interested in bypassing crowded international gateways for faster turnarounds.
Officials have arranged to process significant amounts of cargo to be carried by a new British Airways (LSE: IAG) passenger service and recently struck a deal with a private company to develop an air cargo warehouse facility with airside access on 4.5 acres of airport property.
British Airways is scheduled to launch nonstop service between London Heathrow and CVG on Monday. Flights will operate five times a week utilizing Boeing 787-800 Dreamliners, switching to four times weekly on Boeing 777-200 aircraft during the winter season. Airline officials were drawn by the fact that Dayton’s population bleeds into the Cincinnati area and there are millions of people within a two-hour drive of CVG.
British Airways selected Miami-based Alliance Ground International, a fast-growing airport services company backed by private equity, to provide warehousing and pallet buildup/breakdown and sorting. AGI is occupying a 15,000-square-foot building where staff will bring cargo offloaded from British Airways flights and send out exports.
The only other carrier that provides trans-Atlantic service from CVG is Delta Air Lines (NYSE: DAL), which flies to Paris.
Although the route is ostensibly for passenger business, cargo opportunities likely factored into British Airways’ decision too. The 787-800 has room in the lower hold for more than 16 tons of cargo. Larger 777-200s can carry 22 tons of cargo and baggage. Stakeholders anticipate the new service will draw substantial interest for goods movement.
GE Aviation, aircraft engine maker Safran, Procter & Gamble, and drug and medical device research company Medpace Holdings all have headquarters and manufacturing sites in the Cincinnati area. Crane Worldwide Logistics has a 1 million-square-foot distribution center about 2 miles from the airport and is building another 600,000-square-foot facility nearby. Amazon Air and DHL Express have superhubs at CVG, where they process millions of packages each week.
“While DHL Express maintains its own dedicated air network … the expanded commercial space that British Airways brings with its new service to CVG will offer additional capacity to our express shipping network. This enhancement will benefit our customer shipments moving in both directions between the Americas and European regions,” said Joe Reusch, vice president of Americas network management at DHL Express, in a statement to FreightWaves. “It also facilitates more direct connectivity for the benefit of management teams that need to travel between our largest hub in the Americas region at CVG and the extensive British Airways network.”
CVG is a new location for Alliance Ground International, which has expanded its U.S. airport footprint over the past two years through a series of acquisitions.
“The way Cincinnati is growing and with the freight forwarders in that area there are a lot of opportunities. So we’re very excited to be getting into that market,” said Warren Jones, AGI’s vice president of business development.
Having a cargo agent with a large customer list and national footprint is a drawing card as the airport authority pursues other cargo airlines, said Simon Wood, director of air service development at CVG.
Cincinnati/Northern Kentucky is the seventh-largest cargo airport in North America by tonnage, according to Airports Council International. More than 70% of the throughput is domestic freight, thanks to the Amazon facility.
In mid-May, CVG officials struck a deal with Burrell Aviation on a master lease under which the Aspen, Colorado-based firm will invest a minimum of $20 million to develop an 80,000-square-foot air cargo transfer facility. Last year, the airport demolished old cargo facilities to make way for a new air logistics center on the northern end of the property. Construction planning is underway.
“We’re expecting a lot of general air freight to take place in that new area. It’s got a huge apron on that side for large freighters. We’ve got great courier business but the missing piece here has been general airfreight and maximizing the belly freight that comes through here,” said Wood.
Nearly two-thirds of the U.S. population is within a day’s truck drive of CVG. A new $3 billion bridge span between Covington, Kentucky, and Cincinnati, made possible by the 2022 federal infrastructure law, is designed to alleviate congestion on Interstates 71 and 75 crossing the Ohio River. The current bridge handles a large volume of daily truck traffic.
Many logistics companies are looking for alternatives to Chicago O’Hare and other major airports where it often take two or more days to retrieve cargo because of labor shortages, poor truck access, limited storage capacity and other factors.
Wood said there was room for CVG to gain air cargo without detracting from cargo-focused Rickenbacker airport, less than two hours northeast in Columbus, Ohio.
IAG Cargo, the consolidated cargo business for British Airways and IAG Group airlines, declined to comment for this story.
Click here for more FreightWaves/American Shipper stories by Eric Kulisch.
Twitter: @ericreports / LinkedIn: Eric Kulisch / ekulisch@freightwaves.com
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