DHL Express is planning major new airport facilities at Milan Malpensa and Madrid as part of €1.3 billion worth of ongoing European network expansion projects, and is adding more flights to the UK and Amsterdam this winter, according to a senior executive.
“It’s all about making sure the network is fit for future growth and making sure we are ready for the next 5-10 years,” Roy Hughes, EVP Network Operations & Aviation, told CEP-Research in an exclusive interview at the company’s European air hub at Leipzig.
The largest ongoing investments by far are at the European air hub at Leipzig and the regional sub-hubs at East Midlands Airport in the UK (€213m) and Brussels (€172m).
However, sizeable investments are also planned at Milan’s Malpensa airport and at Barajas in Madrid (both more than €50m) while there are mid-sized projects (of more than €25m) at Hamburg, Hannover and Nuremberg in Germany, as well as in Stockholm and Budapest.
In Italy, DHL Express aims to defend its position in the industrial north after rival FedEx launched flights at Milan Malpensa airport in 2013 and also strengthen its air network in the rest of the country.
“We want a two-hub solution in Italy. We need to solidify our position in the north. Malpensa will help protect our market share in places like Turin,” Hughes explained. “We opened Malpensa last November as the first stage of going to a big hub.”
This two-hub approach means retaining the existing regional sub-hub at Bergamo while expanding in Malpensa, which has a much longer runway and is well located north-west of Italy’s industrial metropolis. DHL expects to invest about €70-75 million in a new facility at the airport.
“We will keep Bergamo but Malpensa gives us a dynamic development, huge opportunities and will help to protect our market share in north-west Italy. We need this up and running within the next two years,” the network chief declared.
At present DHL Express has six flights to and from Milan Malpensa, with two daily B757F flights to and from the Leipzig hub, a feeder flight to East Midlands connect to the first daily flight to the USA, and twice-weekly B777 flights to Hong Kong (on Thursdays and Sundays). No major flight changes are planned until the new Malpensa hub is operating, according to the company.
Elsewhere in Italy, DHL Express plans to switch Rome flights from the small Ciampino airport to the main international airport of Fiumicino, and is looking at a new greenfield facility to cover Venice.
In Spain, DHL Express plans to invest more than €50 million in a new hub at Madrid airport and will spend a further €20 million expanding its regional sub-hub at Vitoria in the Basque Country.
“We will build a greenfield hub in Madrid. We hope for an operational start within the next two years,” Hughes revealed. This new facility would provide more operational capacity, enabling DHL to add flights and also to use more commercial capacity on flights to Latin America.
In France, DHL is expanding Marseille into a regional mini-hub for flights to North Africa after adding feeder flights from there to Algiers and Tunis. The ground infrastructure should be complete by November and the company hopes to launch the new facility in the first quarter of next year.
Other significant new or improved airport facilities around Europe will include Warsaw, Budapest and Sofia, while Bucharest is also in line for a new facility.
In terms of air operations, the European air express network will be enhanced in the forthcoming winter 2015/16 schedule with several new flights, including a second Amsterdam flight.
In the UK, Hughes said he wants to increase the number of regional flights such as the recent start of flights to Aberdeen in north-east Scotland. “I’m looking to improve our platform in the UK,” he explained. DHL will launch six weekly flights to Manchester where it opened a 3,465 sqm facility last November that is designed to cope with volumes for the next 10 years.
In south-east England, DHL is considering expanding flights either to Luton or Stansted, two low-cost airports located north of London that offer faster access to parts of the British capital than from Heathrow via often congested west London. “This would allow us to get from the hub to the service centres earlier,” Hughes commented.
