East Midlands Airport’s growing cargo operation is helping to drive a surge in regional exports
By Steve Griffiths, Managing Director, East Midlands Airport
Airports have a crucial role to play in the economic fortunes not just of the regions they immediately serve, but more widely as major contributors to the UK economy.
This is borne out by statistics showing that more than half of Midlands exporters grew sales in the second quarter of this financial year, with East Midlands firms the second strongest for entering new markets in this period. The UK Trade Barometer, developed by our parent company MAG and The Growing Together Alliance of business groups, also found that 45% of exporters to the US forecast growth in the next quarter and that sales to China are set to surge in the next three months.
As the UK’s number one express air freight hub, East Midlands Airport punches well above its weight in supporting global trade. Recent figures show that growth in our cargo volumes outpaced Heathrow, with more than 100,000 tonnes handled at East Midlands between May and July which is 17.4% up on the same period last year.
This contrasts with industry data that indicates that volumes of cargo carried in the ‘belly’ of passenger aircraft – the majority of Heathrow’s cargo – have remained largely flat year-on-year.
This speaks to one of East Midlands Airport’s unique selling points. Our unrivalled cargo operation deals solely in cargo-only aircraft, which operate in and out of the airport largely at night. These factors, and the ease and efficiency of our operation, provide certainty for freight carriers that their goods won’t be delayed at the airport while passenger flights take priority.
Added to this, our strategic central location, right next to the M1, offers access to 90% of the UK population within four hours. One cargo airline which moved its operations from Heathrow to East Midlands a year ago, One Air, tells us that it’s quicker to get goods offloaded from East Midlands to its warehouse near Heathrow than when it flew into Heathrow.
All these things have attracted major logistics firms like DHL, UPS and FEDEX to base their UK operations here, and contributed to us landing deals with four new cargo airlines since May and the subsequent growth in cargo volumes.
As an island trading nation, the UK relies on strong connectivity to all key markets of the world. We know businesses trading internationally want to get their goods in and out of the country seamlessly, and East Midlands Airport has long played a vital role, forming the backbone of express freight that powers the growth of advanced manufacturing and other high-value industries.
Around half are firms based in the region which rely on the airport to make their business work. This is reflected in the findings of The UK Trade Barometer, which surveys more than 2,000 businesses about their export performance over the past three months and their expectations for the quarter ahead.
The latest survey shows that East Midlands firms grew their global footprint in the second quarter of the financial year, with 58% entering a new market for the first time. That compared with 46% in the West Midlands. Only the North West was higher, at 68%.
Across the Midlands, 51% of exporters increased sales to existing markets, while 29% entered a new market. America topped that chart, followed by Ireland, Poland and China. There was an increase in businesses saying they expect to grow sales to China, those saying they had grown sales to China as an existing market, as well as businesses entering China for the first time. The four new airlines starting operations at East Midlands recently are all flying routes to and from China, while One Air which also already operates to China is starting scheduled services from Hong Kong next month, and so East Midlands is well-placed to support this trend.
To respond to this extra cargo activity, we recently reconfigured our aprons to increase the number of cargo stands that take wide-bodied aircraft. And we also have a longer-term cargo growth vision for East Midlands, with four runway-side plots available for redevelopment. That will include 122,000m2 of warehouse space, new taxiways and stands for up to 18 more aircraft. The plans anticipate a 54% growth in express freight cargo volumes over the next 20 years and could support more than 20,000 new jobs and an uplift of almost £4bn for the economy.
Two of those sites have Freeport tax status, while a third that we own south of the airport is earmarked for a new logistics and advanced manufacturing park developed by global logistics property giant Prologis. It’s estimated this will help unlock £1bn of investment.
Developments like this close to the airport, and the strength of our cargo operation, underline the importance of aviation as a key enabler for the Government’s new Industrial and Trade Strategies, and as a source of jobs and wider economic activity.