Bangkok's New Airport a Long Way from Its Aspirations

A military coup in Thailand in September may be of little consequence as far as the air freight world is concerned, but opening an airport can seriously hurt your business. As the clock was ticking down to the opening of Bangkok's new Suvarnabhumi International Airport, the head of cargo of one major Asian carrier was feeling decidedly jittery, and this had nothing to do with the heavy military presence in the streets of the Thai capital after the military had just taken over the government in a bloodless coup.

A week before the opening of the $4 billion Thai gateway, a year after its original due date, the cargo infrastructure was hardly inspiring confidence. According to carriers, the buildings were up but the information technology setup was far from ready, which threatened dire problems once carriers switched over from Bangkok's old Don Muang airport.

So one airline was contemplating suspending its cargo operations in Thailand for a couple of days to avoid a potential meltdown.

In recent history some mega-airports in Asia inflicted painful cargo experiences in the wake of their grand openings. Memories are still vivid of the first months of the new gateways in Hong Kong and Kuala Lumpur in the late 1990s, openings marred by system failures and assorted problems that added up to heavy congestion and crippling delays.

In both cases it took months to clear the backlogs.

Golden Land

Thai exporters shared these concerns. Perishables exports by air, which account for some 40 percent of Thailand's air export volume, were down 20 percent on the day the new airport opened. Members of the Thai Fruit and Vegetables Association Producers Association had suspended air shipments on that day to avoid trouble.

In the event, Suvarnabhumi (which means 'Golden Land') suffered minor glitches on the passenger side on the first day of operation, but the much-feared breakdown failed to materialize.

Six days later, however, the pessimists' predictions were apparently coming true after all. Malfunctions in the IT system forced cargo handlers and customs officials to switch temporarily to a manual system. Some flights left without a kilo of freight because goods could not be loaded on time, the Thai Airfreight Forwarders Association reported.

Moreover, Bangkok Flight Services, the second handler at the airport besides national carrier Thai Airways, was understaffed and did not have enough ramp handling equipment, according to forwarder reports.

Ole Ringheim, vice president of air freight for the Asia Pacific region at DHL Global Forwarding, said the disruptions proved short-lived, however. After one day of turmoil, the situation was more or less under control.

Having come through its first scare, the new airport aims to establish itself as a major cargo gateway for the region.

Thai exports - besides perishables foremost, as well as electronics and automotive traffic - will be the main engine, but the authorities are looking at a role that transcends the country's borders. Suvarnabhumi, which boasts the world's longest commercial runway (13,120 feet) and the tallest control tower, can handle 1.5 million tons of freight in a year, twice the capacity of its predecessor.

Local Flavor

Thailand's immediate neighborhood seems to hold some promise.

Ken Choi, president of Korean Air Cargo, sees good potential for traffic growth in Bangkok from nascent textile exports out of Burma and Cambodia.

A more prominent role for Suvarnabhumi would be a good deal more challenging to attain. "To put it in a league with Singapore or Hong Kong as a hub would be a bit of a stretch," Ringheim said.

Existing maindeck capacity may be sufficient to absorb the growth from Burma and Cambodia, but it is nowhere near levels usually associated with regional hubs. This is unlikely to change any time soon.