[ICN Business – Logistics #1] Know the logistics to understand the airport


An airport serves as a gateway for transportation while also being hub for business. This is because it has a great impact on the regional and national economies, creating tens of thousands of jobs and driving the development of related industries.

Through this series, [ICN Business], we would like to introduce the lesser-known appeals of Incheon Airport, which takes the lead of businesses such as logistics, Airport Economic Zone, overseas business, hubs, and construction.


Imagine this.

 

What process does a lobster in Halifax, Canada go through to get to the table of a consumer in Korea? The lobster is first captured, loaded onto a mode of transportation, and shipped across borders. It seems easy when said aloud, but there are many hidden steps within this process.

 

What if…

“live lobsters”

are added to this situation? It must not be easy to keep lobsters alive while shipping them all the way to Korea, right?

Incheon Airport boasts extensive and systematic logistics infrastructure that allows for fast and proper shipment of “cargo” including lobsters. It also provides various technical and institutional support. To help you better understand what Incheon Airport does, we would like to talk about the overall concept and flow of “air logistics” in this post.

#1) What is logistics, and why is it important?

Logistics refers to the “flow of objects” between their point of origin and the point of consumption. In other words, it refers to a process that makes it efficient to transport goods produced by the supplier to the consumer. If transported by ship, it is referred to as maritime transport. If shipped by airplane, it is referred to as air transport. Air logistics collectively refers to a broader process that includes the transport of goods.

In a global era where all types of goods and human resources are exchanged across the world, ensuring “logistical competitiveness” itself carries huge implications. Cargo volume increases where logistics are actively supported, and a higher cargo volume leads to more added value and jobs and a vitalized national economy. As of 2019, Incheon Airport’s cargo volume stands at 2.76 million tons, the third largest in the world. The third largest in the world. Amazing, right?

What made this possible? As Incheon Airport is located in the center of the Asia Pacific, it is best positioned geographically as a logistics hub. An amazing fact is that 32% of the global population, or 2 billion people, live within just 2 hours 30 minutes of Incheon Airport by air! This is why Incheon Airport positions itself proudly at the center of international business.

#2) Does Incheon Airport have terminals other than T1 and T2?

Airplanes are divided into “passenger airplanes” and “cargo airplanes,” depending on what they predominately transport. Passenger airplanes are the ones that passengers board. These types of airplanes carry passengers’ luggage, including carry-ons, in the belly cargo on the underside of the plane. Other types of cargo are loaded and shipped separately in cargo airplanes.

 

Passenger airplanes and cargo airplanes stay in different places, respectively. If passenger airplanes come into passenger terminals, where do cargo airplanes go? They come into cargo terminals!

The cargo terminals are located in a place that ordinary passengers cannot easily access. As you can see in the aerial photograph above, they are located in the Free-Trade Zone far away from the passenger terminals.

The Incheon International Airport Free-Trade Zone is garnering attention as the logistics hub of Northeast Asia as it ensures free manufacturing, logistics, distribution, and trade activities, provides rent that is 10-30% cheaper than that in the nearby area, and offers in-bond benefits. It is divided into the Cargo Terminal Area and Airport Logis Park.

The Cargo Terminal Area is the place where cargo is directly loaded into cargo airplanes. Here, security is very important as it borders both the *airside (A/S) and the *landside (L/S).

  • Airside: Area that includes the airport facilities required for takeoff and landing of airplanes such as the runway, landing strip, taxiway, apron, etc.
  • Landside: Area that includes passenger and cargo processing facilities, parking lots/garages, other subsidiary facilities, etc.

The Airport Logis Park is a free-trade zone established to store, package, and ship incoming cargo, supporting imports and exports of air cargo in Korea. It is also referred to as hinterland which facilitates the efficient operation of cargo terminals.

#3) Air logistics flow understood through the “lobster” shipping example

Now that you understand the basic concept, we will explain how cargo is transported from place to place. Let’s get back to the lobster shipping example.

  1. Frozen-packed lobsters are loaded in cargo trucks at a lobster center in Canada and sent to Halifax Airport.
  1. A cargo airplane of ☆☆ Airlines containing the lobsters arrives at Incheon Airport after a 20-hour flight. More precisely, it arrives at the “cargo terminal,” right? Of course, this is not the end of the story.
  1. Next is customs, which is a process that thoroughly checks whether the goods can be brought into the country, and then comes classification within the cargo terminal.
  1. After successfully passing customs, the lobsters move to Incheon Airport Logis Park. They are temporarily stored in a fresh cargo warehouse in Logis Park.
  1. After being re-classified depending on their destination, the lobsters are loaded in cargo trucks and sent to various wholesalers and retailers such as markets and restaurants.

I would like to give lobsters a pat on the back and tell them, “Job well done,” for flying such a long distance and going through this whole process.

In conclusion, today we took a look at the very basics for understanding air logistics, including the basic concept of logistics, logistics facilities at the airport such as cargo terminals and Logis Park, and the overall logistical flow as seen through the lobster shipping process.

 

Next time, we will introduce Incheon Airport Logis Park in greater detail. If you are wondering why the Logis Park is so great, wait for our second post on logistics!

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