The twin ports

Latin CEO: Executive Strategies for the Americas, August-Sept, 2002

From the early flights of Pan Am Clippers to South America, and the first cargo ships plying the Caribbean, Miami has always been a transportation hub for the Americas. Now, with their ongoing building programs, the city's ports are becoming more vital than ever for the region.

The global aviation industry is still recovering from the disastrous year that followed the infamous Sept. 11 airborne terrorist attacks, but it would be hard to tell that at Miami International Airport. There, a massive, US$4.8 billion remodeling project is in full swing -- including the development of a fourth runway and a US$1 billion-plus passenger concourse for American Airlines, which maintains its Latin American hub in Miami. A big new south-terminal development will house the operations of several major carriers, including Mexicana and Brazilian airline yang.

Building greater airport capacity is widely seen among business and political leaders as critical to keeping Miami-Dade economically competitive, and for good reason. Last year, Miami International ranked as the 17th busiest airport in the world in terms of passenger traffic, and No. 3 in terms of cargo volume, according to Airports Council International, a trade group.

More specifically for the Americas, MIA is now the top airport in the US for international freight and the recognized cargo gateway to the Americas. MIA has more scheduled non-stop cargo flights to Latin America and the Caribbean than the airports of Orlando, Houston, New Orleans, Atlanta, Tampa and New York combined. In terms of passengers, MIA is the No. 3 US airport for international passengers (15 million, arriving and departing); more importantly it is the top US airport for international travelers to and from Latin America.

"We have some 59 percent of the total [US] airplane seats to South America, about 44 percent to Central America and about 38 percent to the Caribbean, and we're number one in the US to all of those markets," says Miami-Dade County Aviation Director Angela Gittens. The old adage that it's easier to reach anywhere in Latin America from Miami than from anywhere else in Latin America is still true, says Gittens.

Like most airports worldwide, however, traffic has not yet returned to pre-Sept. 11 levels, but it is returning. "It started 60 percent off, then 40 percent off, then 30 percent off, then 25 percent off--so it is coming up," Gittens says. As of July, MIA was just 12 percent off from 2001, year-to-date.

What has helped MIA recently is what has helped it since the airport was founded in the 1950s--its intimate links to Latin America. No other single airport in the world has as many routes to cities in the region, and those connections have again and again led regional multinationals to locate in Miami. All told, MIA has direct flights to 67 cities in Latin America and the Caribbean, with another 13 cities reached after one flight change. That beats even the airport's connections to US and Canadian cities--41 direct and 22 after one change. And even with the slowdowns caused by Sept. 11, the route structure for MIA has largely stayed intact.

"In these very difficult times for our key partners, the carriers that serve us have continued their lift into these [Latin American] markets," Gittens says. "Delta has stopped flying into Buenos Aires, for example, so that Atlanta has no direct flights to Argentina. But American and United have continued their service to there from here, because they understand how important these markets are."

In terms of cargo markets served, Brazil is clearly the leader. With almost US$6 billion in air cargo through MIA last year, "Brazil is the strongest market," says air cargo specialist Werner Von Blon, the MIA gateway manager for freight forwarder Schenker International. In fact, Miami dominates US air cargo traffic with most of the nations of Latin America--88 percent of all air cargo trade with Peru and Venezuela, for example, 73 percent of all air cargo trade with Chile, and just under 60 percent of all air cargo trade with Argentina and Brazil.

And By Sea

Brazil is also Miami's dominant trade partner at the Port of Miami, which, like the airport, is a dominant seaport in US trade with Latin America. While Miami is the world's top cruise port, it is not the largest bulk cargo port with Latin America--oil imports from Venezuela to Houston's port at Galveston dwarf Miami, for instance. Miami is, however, the leading port for high-value TEU's, the multi-modal containers which can be lifted by crane and placed onto trucks.

"The first container port, as you come north from the Panama Canal, is Miami," says Bernard List, assistant port director in charge of marketing and customer services. "We are the largest container port of the 14 deep-water ports in Florida, and we're very pound of that. We're [fast approaching] the 1 million TEU level, and we're going to end up very close to that by the end of 2002 fiscal year."

Also similar to MIA, the Port of Miami is undergoing a series of upgrades and capital improvement projects--37 different projects in all, of which 33 are cargo related. "We are re-aligning roadways, improving technology, segregating cruise and cargo for greater efficiency" says List. "We are staying on the leading edge of capacity"