July 6, 2023

Uprooted cargo airlines relocate to secondary airport near Mexico City


MIAMI — Several cargo airlines began operating this week to an alternative airport outside Mexico City to comply with the Mexican government’s new ban on freighter aircraft using the country’s main international airport. The forced relocation is adding costs and operational complexity for carriers even though the deadline was recently pushed back several weeks.

Airlines with passenger and cargo fleets face increased inefficiencies from shipments being split between two locations. And, industry officials say, the Mexican government’s unilateral eviction of freighters without diplomatic consultation sets a troublesome precedent for countries to alter trade agreements governing commercial aviation.

“Considering that 62% of cargo arrives into Mexico City on freighter aircraft the impact will be quite significant,” said Glyn Hughes, director general of The International Air Cargo Association, via email. “Mexico City plays a key role in connecting the West Coast of the U.S. and Latin America, particularly with passenger operations, and it will be crucial to keep that particular flow of traffic moving.” 

Major industries that heavily rely on Mexico City for import and export activity include automotive, medical devices and pharmaceutical, according to Everstream Analytics, which helps companies assess global supply chain risks.

Mexican President Andrés Manuel López Obrador decreed in February that cargo jets were no longer permitted at Mexico City International Airport (MEX) to relieve chronic congestion. Airlines pressed for more time to make the switch to Felipe Angeles International Airport (NLU), a former military airfield about 31 miles away that opened for commercial flights in 2022. Moving involves securing new warehouse space, uprooting workers or finding new ones, transferring equipment and training.  

The government, in response to industry concerns, gave all-cargo airlines until July 7 to move out of MEX and recently extended the deadline to Sept. 1 after Obrador met with U.S. Transportation Secretary Pete Buttigieg. A Mexican official said the timetable was relaxed because airlines need to obtain international permits and certifications, according to Reuters

Infrastructure, including customs processing and pilot accommodation, at NLU are now in place to support cargo activity, said Alvaro Cortina, the commercial director for Mexican cargo airline mas. 

Some carriers have chosen to maintain their original move dates and have already shifted their operations to NLU.

Air Canada and Cathay Pacific commenced flights to Felipe Angeles last Saturday, while Air France/KLM and Lufthansa Cargo say they will begin flying there Friday. A second Cathay Cargo flight arrived Monday. Lufthansa operates six weekly flights from Frankfurt, Germany, to the Mexico City area with Boeing 777 freighters. Air France/KLM has two freighter flights per week and 21 weekly widebody passenger flights to MEX.

Express parcel carrier DHL was the first airline to move to NLU, in March, and now operates three daily flights from its U.S. hub at Cincinnati/Northern Kentucky International Airport. It has a new $55 million facility with more than 53,000 square feet of storage space. 

Having dual locations for airfreight in the Mexico City region creates extra headaches — paying for duplicate warehouse service and making it difficult to consolidate customer shipments — for airlines that also move shipments with their own passenger aircraft or have transfer agreements with partners. Cathay Pacific’s freighter division, for example, does interchanges at MEX with Latam Airlines’ passenger network to move freight from South America to Hong Kong.

During the transition period, some airlines are offering truck service between MEX and Felipe Angeles. Lufthansa Cargo announced a nighttime truck shuttle service to transfer shipments between the two airports.

“Freight forwarders need to register at the new airport. If they don’t register they cannot access the airport. That’s going to be the biggest stumbling block every airline has to deal with. If they don’t register, then they have to pick up and tender freight in MEX,” Fred Ruggiero, Cathay Pacific’s vice president of cargo for the Americas, said in an interview during an air cargo conference here last month. “We’re prepared to help them until they get up and running, but we’re not going to be doing this forever.” Plus, he noted, shippers will lose an entire day tendering freight and clearing it at MEX and then trucking it to NLU. 

Mexico City has one of the busiest airports in the world. (Photo: Shutterstock/Andrea Izzotti)

Cortina said mas postponed its move to Felipe Angeles until July 26 because some logistics customers have not completed registration at the new airport.

“We do anticipate some challenges during the first months of our operation in NLU, particularly in the process of transferring cargo between MEX-NLU and vice versa. However, we are confident that in the long term, NLU will offer cargo operators more flexibility and operational growth than the current airport,” he told FreightWaves in an email message.

The Mexican government is trying to attract more international passenger airlines to NLU, which would be beneficial for cargo connectivity, but so far there have not been any takers. The airport only offers flights to a handful of international destinations in Latin America and the Caribbean.

The use of ground shuttles between the two airports adds security risk for cargo, said Mike White, a veteran air cargo official who provides advisory services to PayCargo and other companies, in an interview at the conference. 

When Dubai completed a second airport in 2010 and moved cargo planes out of Dubai International Airport to free up room, it also built a secure truck lane on a ring road that connects the two facilities. The road was on the perimeter of the city, while the trucks in Mexico must navigate congested city roads. The cargo shipments are also monitored by police and the airport.

“Mexico City doesn’t have the same infrastructure option,” said White.

Paul Doell, vice president of government affairs at the National Air Carrier Association, expressed concern in a phone interview that Mexico’s violation of air services agreements could serve as a green light for other countries to adopt policies that unfairly hinder foreign airlines.

“What if Belgium, or whoever, says, ‘Hey, we’ve got all these noise concerns so we’re not going to let you operate anymore out of our main airport; you’ve got to go to some subsidiary airport 80 miles away.’ Having governments just decree this stuff and forcing carriers to move their operations, we think sets a bad precedent.”

U.S.-Mexico trade is further challenged because the U.S. Federal Aviation Administration downgraded Mexico to the Category 2 air safety rating in 2021, preventing Mexican airlines from applying for new services to the U.S. The FAA is expected to complete a review of the country’s aviation safety this summer. Reinstating Mexico as a Category 1 country would enable new operations from Felipe Angeles that could partly alleviate some of the connectivity that is being lost by moving freighters there, TIACA’s Hughes said.

Click here for more FreightWaves/American Shipper stories by Eric Kulisch.

Contact Reporter: [email protected]

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