Wednesday, December 21, 2016

Lehigh Valley International Airport looking at short-term, long-term cargo traffic solutions: 110 million pounds of freight came through in 2016

HANOVER TWP., Pa. - If the airport authority hadn’t expanded its cargo plane apron in the 1980s, Lehigh Valley International Airport couldn’t have possibly handled the massive influx of cargo now flowing through the Lehigh County airport.

And the airport can’t grow what has become a new, significant source of revenue until it expands that capacity.

“I think we’re on the edge of a remarkable opportunity,” said Mike Dowd, chairman of the Lehigh-Northampton Airport Authority’s board of directors.

The board on Wednesday received an overview of the airport’s burgeoning cargo flight business that will include a short-term fix next year to the growing problem of a lack of space and logistical hurdles.

Connie Phillip, the authority’s director of commercial services, told the board that space is at a premium in LVIA’s 35,000-square-foot cargo warehouse. Add to that the nearly 30-minute, 2-mile round trip for cargo haulers from the warehouse to the cargo apron and the authority needs to make the process more efficient.

That distance certainly presents “operational challenges” especially during inclement weather, Phillip said, noting it could take 18 to 20 trips to unload and reload a cargo plane.

A new cargo warehouse situated near the apron that can currently accommodate five cargo planes is the goal. The authority has recently added temporary trailers to for staff and administrative needs.

In 2015, FedEx saw about 471 flights carrying about 30 million pounds of freight compared to 433 flights carrying more than 30 million pounds of freight, so far this year. Phillip said LVIA handled about 39 million pounds of cargo by this this time last year. That number has swelled to about 110 million pounds.

The cargo operation, in fact, has become an almost 24-hour-a-day operation with one flight scheduled to leave at midnight. Outbound planes are destined for locations such as Indianapolis, Memphis, Tampa, Charlotte and Ontario, Canada.

Darren Betters, the authority’s business development director, said Amazon is negotiating a lease agreement with PennCap Properties for warehouse space at 2200 Hangar Place. The authority will have nothing to do with the lease for a building that’s off airport property, but it’s much closer to the cargo apron, he said.

The authority is working with PennCap and Amazon to plan access from the warehouse to the nearby cargo apron. Authority Executive Director Charles Everett said officials have already started laying out a route from the warehouse to the apron. He expects that project will be completed within the next six months.

That will buy the authority about 18 to 24 months to plan, design and build a new cargo warehouse and expand the cargo apron, Everett said. How many planes an expanded cargo apron can handle will be part of the planning that will take place in 2017, he said.

Officials said ample land exists around the existing cargo apron to accommodate an expansion.

Cargo traffic has become such an integral part of LVIA’s business plan that a drop in November passenger traffic was counterbalanced by more-than-projected revenue from cargo flights, according to Todd Quann, the authority’s finance and administration director.

LVIA collects revenue from landing fees, fuel sales, facility and equipment rentals and apron fees.

Wednesday’s board meeting marked the final meeting in what officials have called a productive and important year for the previously embattled airport authority.

The authority closed on a $7.8 million land deal with the Rockefeller Group for a new FedEx hub and made the final payment on a multi-million legal settlement that had the authority selling property in the first place. The authority was even reimbursed $57,000 over the disputed final payment.

Officials have been working on a $10 million line of credit to build new hangar facilities geared toward corporate tenants. And the authority has restructured its landing fees to increase revenue and now has a clear plan for Braden Airpark, which had labored under a cloud of uncertainty.

The authority is headed into 2017 with a clean slate, Everett said. The end of the years-long legal battle has moved the authority from a position of putting out fires and just trying to survive to looking at ways to thrive, he said.

Years of deferred maintenance can now be a priority, and officials now have the time to thoughtfully and deliberately plan projects like the expanded cargo warehouse and apron, Everett said.


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