NEW ENGLAND IS DOWN, BUT NOT OUT

NEW ENGLAND IS DOWN, BUT NOT OUT

New England's air cargo market may be still reeling from the recession, but executives at Northwest Airlines' cargo facility in Boston have nothing to complain about.

In fact, Ray Curtis, the airline's district sales manager at Logan International Airport, couldn't be busier. Last year, Northwest's domestic tonnage increased 20 percent, while international exports increased 25 percent. As for exports to Europe, they were up by a whopping 40 percent alone.Some of the uptick in Northwest's export business, of course, has to do with the dollar's recent tumble against international currencies. Still, Northwest's cargo numbers seem to be the exception, rather than the rule, at Logan. According to the Massachusetts Port Authority, from January 1991 to November 1991, domestic freight tonnage leaving Boston was down 6 percent, while international exports were down 4 percent.

Selling Seafood

Of course, the New England (comprising Connecticut, Massachusetts, Vermont, Maine, Rhode Island and New Hampshire) perishables market - much of it seafood - is still holding up nicely. According to the U.S. Department of Commerce, seafood traffic from New England bound for the Far East (and passing through New York) was up 34.5 percent during the first 10 months of 1991 alone.

Northwest, for example, saw its international perishable tonnage from Logan jump 50 percent last year over 1990, said Mr. Curtis. One factor that he said he thinks helped: Northwest is the only carrier at Logan that now has two warehouse doors dedicated to processing seafood.

Outside of Boston, cargo traffic that depends on a larger percentage of dry freight seems to have run into a few speed bumps. At T.F. Green State Airport in Warwick, R.I., for example, air cargo tonnage last year was down 5 percent, while passenger traffic was down 8.8 percent. That means cargo carriers ferried only 31 million pounds of cargo in and out of Green last year, compared to 33 million pounds in 1990, and 23.4 million pounds in 1989.

Officials at Green, which serves Providence, plus central Massachusetts and Cape Cod, now are considering a number of incentives - including a possible new cargo facility - as a way of attracting more business. Said Mary Brennan, Green marketing manager: "Cargo is something that we hope to concentrate on more in the future."

That feeling is being echoed over at Bradley International Airport in Windsor Locks, Conn., which not only serves Hartford and Springfield, Mass., but also gets traffic from Boston and New York. In 1984 Bradley officials spent $100 million renovating facilities aimed primarily at passengers, but now the emphasis has clearly shifted.

"With passenger business going through so many changes, we're going to stop for the moment, take a breath, and start spending more time concentrating on cargo," said Andre J. Libert, director of marketing and development.

Cargo Concept

While 1991 yearly cargo statistics aren't in yet, Bradley officials saw about 100,000 tons of cargo pass through their facility through November of last year, a pittance but an increase of 15 percent over 1990. Now they're working with a developer, U.S. Airports Development & Services in Rochester, N.Y., to develop a $20 million state-of-the-art cargo facility that might go into construction as early as spring.

When the new facility is completed, it should double the cargo space at Bradley, to 150,000 square feet, said Daniel Saperstone, U.S. Airports marketing vice president. He notes that while U.S. Airports currently has projects in cities such as Minneapolis and Rochester, the Hartford cargo facility is the company's first stab at New England.

"We're looking for Federal Express, UPS, and perhaps one or two other carriers to increase their cargo shipments because of the increased space," said Mr. Libert.

"Bradley is the best-kept secret in New England," he said. "We have open conditions, no delays, no ground congestion, the finest snow removal team in the world, no pilferage, no unions responsible for unloading and no Mafia." In short, he said, "air freight (at Bradley) hasn't gotten to the point of volume that it falls all over itself and injures handling."

Elsewhere, Bradley also gets kudos from carriers and shippers alike. Still, the airport's lack of foreign lift capacity, as well as foreign direct flights, is a drawback. "There's no question that Hartford is very convenient," said a marketing executive at Schenkers International Forwarders in Jersey City, N.J. "If they had foreign lift, it would be utilized."

At present, Bradley's foreign service is confined to commuter aircraft to Canada, as well as charter service abroad, primarily to countries such as Mexico and the Bahamas. Still, Bradley officials aren't sitting still.

Over the past year in particular, they've opened up the airport - free of charge - to an increasing number of charity trip operators to carry supplies to Iran, as well as the former republics of the Soviet Union.

Looking Abroad

They've also spent the past two and a half years working with KLM Royal Dutch Airlines to generate air service to Europe. More recently, said Mr. Libert, Lufthansa German Airlines has become interested in offering European service, as have some other carriers.

For many carriers, increased foreign cargo service out of New England is clearly the way to go. Take Northwest's booming Boston cargo operations. Granted, the airline recently did double its cargo warehouse capacity at Logan to just over 60,000 feet.

It also stepped up employee training to make the airline's personnel more receptive to customer's needs - as well as the increasing incursion of foreign carriers such as British Airways into the Boston market. Still, the airline's cargo business apparently generated fresh wind when the carrier recently began offering daily service out of Boston to Amsterdam, Frankfurt, London and Scotland. According to Northwest's Mr. Curtis, the Amsterdam flight - currently the only nonstop out of Logan - has been especially popular.

In February, Northwest joined fellow carriers such as Trans World Airlines in offering nonstop daily service to Paris out of Boston as well. In the past, the airline's Boston-to-Paris flights usually went through Detroit - as circuitous a route as they come. Said Mr. Curtis: "We're very excited. This is a large perishable segment."

This sort of foreign accessibility, of course, is what has Bradley International officials pounding on the doors of carriers such as KLM.

However, Dan Kasper, an international aviation consultant at Harbridge House in Boston, said he thinks that the first foreign carrier to set up shop at Bradley will more likely be British Airways or Lufthansa, simply because these airlines' local traffic is so much larger. As for KLM, he expects it will take its time getting into Bradley, especially since the carrier is apparently now in discussions with British Airways.

Open Skies

''If they're part of a greater entity, then it might not make sense for them to do it as KLM," said Mr. Kasper. Otherwise, he said, "KLM may decide to take a shot at Bradley because that's the only way they can get new authority into the United States."

Lower landing fees are still a strong selling point for New England regional airports such as Bradley. Last August, for example, executives at Marietta, Ga.-based air freight forwarder Lep/Profit International began flying into Hartford. The plane used to fly into Newark - until Hartford's lower landing fees and lack of a curfew persuaded company officials to make the switch.

Bradley now charges the 12 carriers with which it has a contract a $1.40 landing fee for every thousand pounds of freight (otherwise the charge is $1.5O). Logan, on the other hand, charges at least 30 cents more for every thousand pounds, while cargo carriers at Manchester Airport, which services New Hampshire, Vermont and parts of northern Massachusetts, currently have to cough up only 75 cents for every thousand pounds of freight.

As for T.F. Green in Rhode Island, it's sticking to a long-time policy of trying to undercut everyone else: cargo there now costs just 66 cents for every thousand pounds. So far, the strategy seems to be working: While all- cargo carriers such as Airborne Express and Federal Express Corp. now handle about a third of the airport's cargo tonnage, the rest is carried by roughly half a dozen passenger carriers. "We've done well with scheduled carriers out of here," said Ms. Brennan.

Second Tier

Sometime soon, Green may do even better. "What cargo carriers are looking for primarily is a good strong passenger market, and they're not constrained in their access to Logan," says Harbridge House consultant Mr. Kasper.

"Until they can build Boston to as much as they think makes sense, Boston will get most of the growth, and then New York and Newark, and then New England secondary airports that serve as feeders out of the major gateways," he said. "The most likely possibility there will be Hartford, but Green might pick up some too. Northern New England has a way to go, as there isn't that much traffic. Portland is probably the closest, but that's a way off."

And what about the invasion of European carriers? "I think that as European carriers start developing their hub systems more, they'll start introducing more two-engine aircraft such as the 767 into service," he said. ''And that will make service into places such as Hartford likely because it doesn't take too many passengers, or a mix of passengers and cargo, to make economic sense with the 767 that doesn't make sense with the L-1011 or DC- 10."

Not every New England airport, however, is ogling the foreign market. "We have no intention of going international," says T.F. Green's Ms. Brennan. ''First of all, we don't have the runway lanes, but we also figure we've found our niche, one that's also good for the region. We'll remain a small- to medium-sized airport."

Trying for the Show

One New England airport that isn't thinking small is Manchester Airport. In January, airport officials there met with cargo operators at United Parcel Service, Airborne and Federal Express to negotiate a deal for developing an updated - and consolidated - cargo area. Alfred Testa Jr., the airport's director, still isn't sure exactly how large the completed facility will be. But he says the airport has about 30 acres to work with, and that the facility might cost upwards of $10 million, which the carriers will pay themselves.