Air cargo tonnage has dropped 25 percent at JFK over the past decade, and the airport’s ranking in cargo volume has slipped from the third to tenth, according to an announcement this week from the New York Economic Development Corporation.
Changing patterns in international air traffic and the economic downturn have contributed to the decline, but all is not lost.
Improving truck access, replacing outdated buildings and business practices and boosting promotional efforts are all ways industry and government can help the airport regain its dominance, according to a study released this week by the Port Authority of New York and New Jersey and the EDC.
“Air cargo is one of the many issues facing our area’s airports, and we applaud the NYC Economic Development Corporation and Port Authority’s efforts to address this vital issue,” said Joseph Sitt, founder and CEO of Thor Equities.
“Without the modernization of our airports — particularly JFK, which is a major gateway to international markets — the New York City metro region risks falling behind as a top global competitor.”
Sitt is the chairman and founder of the Global Gateway Alliance, an organization of business, academic and political groups “established to address the major challenges facing the metropolitan region’s airports that, if left unaddressed, will serve as a major impediment to the long-term growth of New York City,” according to its mission statement.
According to the alliance, failure to modernize the city’s airports for the benefit of passenger and cargo traffic could cost New York and New Jersey $79 billion in losses to the regional economy, including over $16 billion in lost revenue and $5.5 billion in lost labor income over the eighteen-year span from 2008 to 2025.
According to the EDC, cargo traffic alone supports over 50,000 jobs, provides nearly $3 billion in wages and over $8.5 billion in sales in the New York/New Jersey metropolitan area.
Some initiatives contained in this week’s report already are underway, with others planned to begin soon to strengthen the industry.
The study includes plans to expand opportunities at JFK’s existing Foreign Trade Zone to defer taxes on goods processed in the zone, increase cargo tonnage, build new state-of-the-art cargo facilities and improve co-operation between agencies to move cargo trucks in and out of the airport more efficiently.
“The regional air cargo industry has few rivals as an engine for our economy, which is why it is so important to nurture and expand this vital business,ˮ Pat Foye, executive director of the Port Authority, said in a statement. “Working with our industry partners will create a platform for expansion of the cargo industry in New York City and the creation of additional jobs.”
JFK has long been one of the world’s top air cargo gateways, but has seen competition increase with the growth of international markets — in Latin America, Asia and the Middle East — as well as nationally.
Los Angeles International Airport developed a focus on trans-Pacific traffic, Miami International Airport with South and Central America, and Chicago O’Hare International Airport, given its central location in the U.S., pursued commerce with all markets.
After September 11, 2001, the industry experienced substantial changes with the substitution of trucking activity for domestic air cargo and domestic legs of international air cargo, a trend furthered by unstable fuel prices and the rising costs of security.
On the positive side, the study confirms JFK’s largest competitive advantage, access to the nation’s largest consumer market, served by a network of freight forwarders and cargo brokers located adjacent to the airport in the Springfield Gardens neighborhood of Queens.
Plans already are underway to replace JFK’s outmoded cargo buildings and infrastructure on-airport with a new state-of-the-art cargo facility, a new truck center and a new animal handling facility.
The $32 million animal facility will handle up to 70,000 animals per year and will offer the most comprehensive services of any facility in the United States.