In a year of struggle, cargo represents a rare opportunity in Canadian aviation

Sensing rare opportunity in the midst of the pandemic, Edmonton International will expand its cargo apron, adding enough space to handle two additional wide-body aircraft within the next year or two.

“We were really blessed this summer to have three of the largest aircraft in the world on the ground at the same time,” said Myron Keehn, the airport’s Vice President of Air Service and Business Development, referring to the Antonov 124. “We couldn’t handle all them in one place. Because as you can imagine, the wingtips on those lovely Russian-made aircraft are are pretty extensive.”

The airport will spend $36 million to expand its general cargo apron, Apron VII, by 47,000 square metres. The project will include new hydrant fuelling on the apron and a cold storage facility that will roughly triple in size. It also includes a new connection to taxiway A for more efficient aircraft movement.

“We’re maxing out in that just a pure cargo into four wide bodies of code F aircraft at a time,” said Keehn. “This expands the stand to add additional parking positions. It also provides us with additional cold storage we can move farm agro products into different markets.”

The federal government is funding half the project through its National Trade Corridors fund.

“We are supporting projects which help move goods efficiently to market, and people to their destinations,” said Transport Minister Omar Alghabra in a statement.

Growing cargo

Since the pandemic began, cargo is one of those rare bright spots in Canadian aviation. Most cargo is shipped in the bellies of passenger aircraft. But COVID-19 has upended the sector’s economics.

Statistics Canada reported in January that Canada’s major carriers earned almost as much from their cargo operations as from passengers. At the same time, spending on e-commerce jumped more than 75% in one year. Shippers send the most time-sensitive packages by air.

“A box just doesn’t appear on my doorstep or at my business,” said Keehn. “There’s a whole bunch of people that have been involved in the movement of that good. So we want to ensure that we are enabling that activity to not only occur but to flourish and grow.”

Edmonton handled 46,000 tonnes of cargo last year, the airport reported. That’s an increase of 7.5%, reflecting a national jump in air cargo shipments.

Airports across the country have reported cargo spikes in 2020, with the trend continuing into 2021. Hamilton International, the country’s busiest overnight air cargo hub, handled 658,000 tonnes last year. That’s up a remarkable 24%. Moncton International’s cargo business was up eight per cent. The number of cargo flights into Winnipeg jumped 7.5% in the crucial pre-Christmas period.

Cargojet, the country’s largest all-freight airline, announced major expansion plans. It is adding five Boeing 767 aircraft and a pair of 777s over the coming years. The new planes will boost domestic capacity and be used for new services to Asia and Europe.

Air Canada is investing millions to convert a pair of ageing Boeing 767s for cargo use. The goal is to have them in service by Christmas, deployed on international routes.

Will COVID lead to lasting trade?

Airports have pointed out that some of their largest shipments this year were of personal protective equipment meant for health workers. Now, they’re heavily involved in the distribution of vaccines across the country.

“Our airport has all the necessary infrastructure as far as vaccines right now,” said Keehn. He said Edmonton spent two years working on its CEIV Pharma certification from the International Air Transport Association. CEIV Pharma standardizes pharmaceutical handling around the world. “We have all the infrastructure including the ultra cold freezers here at the airport to be able to handle pharmaceuticals.”

Airports say these vital shipments are a key reason to stay open during the pandemic-induced downturn. Canada’s airports make most of their money from passenger fees. So when the pandemic hit and passengers stayed home, revenues dried up.

Cargo helps soften the blow.

“We had to make hard decisions on what capital infrastructure we invest in,” said Keehn. “But going back to our mandate; after health, safety, and security, our job is to drive regional economic prosperity. And that doesn’t mean the airport is getting returns, that means that the community as a whole, Alberta, Western Canada, and Canada get a win in this.”

Enabler of growth

The Organization for Economic Cooperation and Development said COVID-19 could serve as a catalyst for e-commerce. That means reinventing supply chains.

“At this point in time, there is great uncertainty as to how changes will shake out in the long term,” Bruce Rodgers, the Executive Director of the Canadian Freight Forwarders Association recently told the Commons Transport Committee. He said the drastic reduction in passenger flights and retirement of some wide-body aircraft have led to “significantly increased costs and the addition of ad hoc charter flights.”

Conversely, that has also increased the need to handle cargo-only aircraft.

“This region has the potential to become a major entry point for all North America,” said Malcolm Bruce, the Chief Executive Officer of Edmonton Global. The company promotes international trade and investment in Edmonton. “International cargo logistics and transportation provides tremendous value and jobs. Our northern location is a significant advantage and this investment is a major boost to create long-term opportunities for both exports and imports.”

“We don’t ever want to be a governor of growth,” said Keehn, “we want to be an enabler of growth. And so, as you see this infrastructure investments from the Canadian government really helping Canada and Edmonton further establish our leadership in global logistics. We want to work with our partners – FedEx is one of them, DHL, UPS, Purolator, Cargojet, and all of our other cargo partners that fly in and out of here.

Work on the expansion will start this summer. Once it’s complete, Edmonton’s Apron VII will be able to handle five wide-body freighters at the same time. FedEx also has its own terminal at the airport, capable of handling a pair of widebodies.

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