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Heavy lifting: Brazil's second-largest cargo airport gets the cash it needs to become a mega-terminal.

The government administrator of Brazil's 66 airports, Infraero, has ambitious plans for the country's second-largest cargo airport, Viracopos International, in the area known as Campinas, 100 kilometers from Silo Paulo. During the next 15 years, Infraero aims to transform Viracopos into a mega-airport with the capacity to handle 470,000 take-offs and landings and 55 million passengers per year, as well as the capacity to store 720,000 tons of cargo.

"It will be a complete airport and certainly one of the biggest in Latin America," says Lia Segaglio, Viracopos' superintendent. Currently, up to 25,000 take-offs and landings per year take place at Viracopos, and the complex has the capacity to warehouse 300,000 tons of merchandise. If the necessary environmental permits don't delay the plans, Viracopos will receive US$100 million in investment during the next three years to modernize infrastructure of the cargo and passenger areas and to build a second, four-kilometer runway Its physical area will double to 17 million square meters from 8.5 million now.

The expansion of Viracopos has great significance for the air cargo business in Brazil, which has grown steadily. According to Infraero, national air cargo volume, including imports and exports, grew by 15% in 2004. The agency this year approved investments in several airports in response, Viracopos being the biggest. In 2004 it received a third of Brazil's imports and almost 40% of its exports sent by air, some 600,000 tons of goods.

In the first two months of this year alone, exports passing through Viracopos increased 64% compared to the same period last year. "The expectation for growth in 2005 is 30%," says Segaglio.

Viracopos became known as a cargo airport in 1985, when it lost its international passenger flights to the new Guarulhos Airport, nearer to the city of Sao Paulo. Among Viracopos' attractions are a low rate of closure due to weather, just eight hours per year, and for being in Campinas, responsible for 9% of Brazil's gross domestic product. Many electronics manufacturers have opened facilities in the region precisely because of the proximity to Viracopos, which also serves companies from other states.

All the logistics for moving cargo through Viracopos are sustained by cutting-edge technology. It has the biggest automated pallet-storage system, operated by 10 robots, of all airports in Brazil. And, thanks to the partnership between Infraero, the Brazil's tax authority and the companies that use the airport, Viracopos installed in December VCP-Express, a service that reduces the time it takes to release cargo to four hours from two days. "We managed to get the logistics and customs processes moving along just about as fast as an airplane," says Carlos Alcantara, the director of logistics for Infraero.

According to Alcantara, moving cargo by air can cost up to 20 times what it costs to move it by sea, and users, generally manufacturers of high-value-added products, choose it only because it's fast. "The airport is the fundamental link between the plane and the market. If the link's not agile then we're not viable," says Alcantara.

The first company to take advantage of the new development was Solectron, a technology group, which imports 90% of the materials for electronics and telecommunications products through Viracopos. Currently, the company gets 100 tons per month of imported merchandise at its plant, 53 kilometers from the airport, within three hours of the plane touching down. "We've come to have the same agility with exports: A year ago, we took three days to load the products. Now the process gets done within hours," says Claudionor Lopes da Silva, logistics director for Solectron. The company buys components from the United States, Europe, Mexico and China and ships mobile phones and computers to neighboring countries in South America.

For now, only the companies participating in Recof, a system created by Brazil's tax service to benefit Brazilian industries exporting at least $10 million per year, can really take advantage of this rapid export channel. Those companies represent less than 10% of Viracopos' 500 clients, but Infraero believes that in the medium term it will extend the benefits to more industries in Brazil.

Unplanned. Although Viracopos uses 70% of its cargo capacity over most of the year, slowdowns are at times inevitable. "Bottlenecks will always exist in air transport because 60% of all cargo is not planned," says Hernan Merino, executive director of Absa, an air-freight company responsible for 20% of the cargo exported through Viracopos.

For exporters, the main problem rests with the lack of regular flights, because many planes take off empty to pick up better-paying cargo in nearby countries--leaving Brazilian exporters without planes. "We get caught several times a month without an available flight for products," says Paulo Oliveira, logistics director for mobile phone manufacturer Motorola. In 2004, the company imported $1.30 billion in components and exported $550 million in mobile phones and other telecommunications products to the United States and Latin America, 80% of it via Viracopos. "Brazil needs to increase export volumes to attract more planes," says Oliveira. "If that doesn't happen, not even a mega-airport can avoid bottlenecks."
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Title Annotation:CARGO
Comment:Heavy lifting: Brazil's second-largest cargo airport gets the cash it needs to become a mega-terminal.(CARGO)
Author:Pfeifer, Margarida O.
Publication:Latin Trade
Geographic Code:3BRAZ
Date:Jun 1, 2005
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