Atlanta is the new Miami. Dallas-Forth Worth is the new Los Angeles. If only targeting a new air cargo gateway were as easy as making a simple declaration of intent.
Last month, Bob Pertierra, Metro Atlanta Chamber’s vice president of supply chain and manufacturing, talked to American Shipper about Atlanta’s hopes to snare Latin American freighter carriers away from their traditional U.S. gateway, Miami.
Pertierra wasn’t necessarily talking about Atlanta’s airport becoming the next Miami, but he saw reasons for Latin American carriers to think twice about staying in Florida.
Atlanta’s quest to divert carriers from a nearby gateway is nothing new. In fact, the history of U.S. gateways is full of failed attempts to replace the status quo, according to Mark Thorpe, assistant vice president of air service development at Dallas-Forth Worth International Airport. Thorpe, himself, is trying to reposition his airport as a gateway, of sorts, or a secondary option for carriers routing from Asia to Latin America.
Last year, Dallas saw 663,302 tons of cargo activity, a 1.4 percent gain over 2011’s numbers. In the first two months of 2013, the Texas airport has seen 99,904 tons of cargo, which is good for a 1-percent rise over the first two months of 2012. Thorpe’s goal is to bump these numbers up by adding in more Asian and Latin American activity. But he’s not going to fully take on Miami or Los Angeles.
“It seems to me that the rumors of the demise of a Miami or a LAX or a JFK are always exaggerated. As much as you want to replace them as gateways, they’re there for a reason,” he said.
“It’s been tried before and failed many times,” Thorpe continued. “It’s a history littered with a lot of corpses.”
Currently, Los Angeles’ airport is the entry into the United States for Asian carriers, just like Miami has been the throughway for Latin American airlines. A lot of the justification for gateways used to be tied to equipment. Before the introduction of Boeing 767s, which had the capability to stay in the air for longer than their forebears, flights from Europe had to stop at New York’s JFK to refuel. After the larger planes started infiltrating the industry, carriers began flying over JFK in favor of ports in the Midwest. (Airport officials, with a recently released master plan, are striving to get back some of that lost business.)
Dallas’ pitch to Asian carriers for becoming a new gateway, somewhat ironically also hinges on technology. There are currently no aircraft that can fly non-stop from Asia to Latin America, and Tokyo to Miami on an extended-range 787 is still a bit of a challenge, Thorpe said. With these facts taken into account, Thorpe would like to convince airlines that Dallas is simply a better halfway point in the journey than Miami or Los Angeles.
The struggle to remake traditional U.S. gateways, though, is an uphill battle. Thorpe has his eye not on taking gateway status away from Miami or LAX, but giving carriers another option. From his eight and a half years working at LAX and his year and a half on the job in Dallas, he knows changing the engrained routines of shippers, freight forwarders and carriers isn’t easy.
Traditional gateways first emerged in strategic locations around the United States because of geography, but over time, these ports built up expertise handling cargo on these lanes. Miami, for example, has built up large refrigeration facilities because the amounts of perishables routing out of Latin America demand this type of care. Miami officials have also developed a strong U.S. Customs clearance presence that is used to handling these goods.
Taking a large customer from Miami and transplanting the business to Dallas or Atlanta doesn’t transfer the knowledge gained over years of dealing with these carriers and the shipments. And though refrigerated warehouses can be built at Dallas, it doesn’t mean carriers will fly there. Simply put, there’s still a reason that traditional gateways are popular with certain carriers.
Thorpe added the presence of a seaport automatically puts Miami and LAX at the top of the list for gateway airports. While Dallas has extensive trucking infrastructure, it lacks an adjacent ocean port.
“The L.A.s, the Miamis, the JFKs have a huge geographical advantage in their proximity to the ocean as well as just where they are in relation to the regions of the world where they’ve become dominant gateways,” he said.
Thorpe hopes American Airlines, which accounts for 85 percent of Dallas’ traffic, will help push his secondary-gateway goal forward. With the rollout of American’s new Boeing 737-800 planes, the airport is now servicing Bogota, Quito and other Latin American cities that once only saw connections from Miami. Thorpe sees the airport as American’s opportunity to have a pipeline from Latin America to Asia. In that vein, the carrier began a flight from DFW to South Korea’s Incheon International Airport in May, and Thorpe believes American will start a flight to China by next year.
“We’d like to see DFW become, at least on American medal, the dominant Asian gateway,” he said.
American Airlines’ pending $11 billion merger with US Airways, which is expected to close in the third quarter, could help enhance the cargo activity that routes through Dallas. Thorpe said the merger will give American a new beginning, and perhaps a revisiting of strategy, that will help further establish the carrier at DFW.
“It’s an exciting time because there are always new opportunities, there’s a fresh look. A new management team will be a mix of US Airways and American, and there will be a different perspective by bringing a lot of bright minds into the room,” he said. “A plus B is going to equal C, and it’s going to be exciting to see what C is.”
New U.S. gateways easier said than done
