Frankfurt-Hahn Airport (HHN) will increasingly focus on e-commerce. All market forecasts predict that volumes will continue to rise sharply. So, the question is: should Hahn join the bandwagon or rather monitor the further market development before taking action? For Rüdiger Franke, CEO of operator TRIWO Hahn Airport, the decision has been made.
HHN enjoys broad public support
The manager’s credo: only those who participate can shape the future. Regarding Hahn, this means that e-commerce needs to be put very high on the agenda in order for the airport to become a player in the million euros ballgame. The most important prerequisites: HHN operates 24/7/365, has a runway length of 3,800 m, offers cargo airlines the choice of two ground handling agents for shipment processing, and Hahn enjoys a dense highway network well connecting it to the trade centers in Luxembourg and the very populated Rhine-Ruhr region. Above all, the entire region supports the airport. A unique feature in aviation-critical Germany, as HHN provides jobs for more than 2,000 people in an otherwise rather structurally weak and rural region.
Limited control capabilities
Until now, however, Hahn Airport has tended to be a bystander in the global e-commerce business, with the flow of goods largely bypassing it and mostly landing in Liège or Budapest – much to the delight of the airport operators there, and to the detriment of Germany’s national budget. “This is because around 80% of the shipments arriving in Liège are transported on to end-consumers in Germany,” Franke maintains, critically eyeballing the Berlin government. He refers to a recent TV report in which it was stated that, on average, one million parcels arrive in Liège every single working day. Last year, over 2 billion low-value parcels (<€150) were brought into the EU. And it is estimated that 65% of these were declared with a commodity value below the duty-free threshold, in order to dodge duties. It would require thousands of additional customs officers to control the legal status of each individual shipment, which is virtually impossible.
Coffers full of money
According to EU regulations, all imports from third countries with a value of less than 150 euros, are exempt of duties. However, the import sales tax remains in the country the destination airport belongs to. “Berlin needs money, and the e-commerce business could provide the state with urgently needed funds to finance infrastructure,” Mr. Franke argues. Despite most of the Shein or Temu items flowing into the EU block of 27 have been ordered by Germany-based consumers, the coffers filled with import sales taxes remain in Belgium, Hungary or anywhere but Berlin. According to New York-headquartered Coresight Research, Shein alone controls around a fifth of the global fast fashion market. Together, Shein and Temu send an estimated 450,000 shipments a day to Germany with most of them processed in Liège or Budapest.
Focusing on e-commerce
The e-tailers’ business is based on drop-shipping. Their local stores send shipments directly from the manufacturer to Miami, Liège, Budapest, Chicago or Sao Paulo, bypassing distribution and sorting centers. This saves costs and reduces the price, which in turn boosts their growth.
When it comes to e-commerce, “we have to really step on the gas pedal now,” says Oliver Hellwig. He is the owner of the Hahn Cargo Center, which offers roughly 7,000 m2 of warehouse space. During our stay on 07AUG24, it was filled with a multitude of shipments flown to Hahn from non-EU countries by Silk Way West Airlines. The carrier serves the airport five times a week, operating a B747F. There used to be almost three times as many flights, but the German government curtailed the traffic due to the previously applicable traffic rights. “For Germany to be a functioning e-commerce location, we need a significant increase in flexibility in the allocation of flight rights, enabling a level playing field for all actors, be it EU-registered or other airlines,” says Robert Kurth, Managing Director Hahn Cargo Services.
Flexibility is paramount
Hahn’s e-commerce strategy will only succeed if the local authorities also play their part. What is required are flexible practices exercised by the border inspection point that controls the lawful import of a multitude of products. Airlines that transport perishables are particularly dependent on the rapid approval of imports by the relevant authorities. Take Egypt Air, for example, which has been landing twice a week at Hahn with A330Fs since 01JUN24, almost exclusively with general cargo on board of its freighters. However, from November to March, the airline will mainly carry perishables on behalf of producers in Egypt, to supply the European market. As the flights take also place on Fridays and Sundays for network reasons, a lot of flexibility on the part of the customs authorities is paramount to keeping the goods flowing.
The dire times seem to be over
The border control point at Hahn, a central official requirement for checking and releasing goods in accordance with the multitude of EU regulations, was reopened in MAR24. A uniform interpretation and application of the European Customs Code in all member states of the block, would make processes easier and boost the business further, holds Mr. Franke. Following a prolonged dire period, air traffic is picking up at HHN again. Just days ago, a freight carrier from the Middle East that operates A321F aircraft among other variants, expressed high interest in cargo flights to and from Hahn, the HHN management confirmed. Provided both sides agree on the terms, the flights would operate several times a week, which corresponds to a weekly transport capacity of 100 tons on offer to shippers and forwarding agents. Perishables are definitely part of the products landing at Hahn. One more reason for the airport to count on the flexibility of the local customs authorities regarding night and weekend availability.
