T H E I T A L I A N M A R K E T A I R C A R G O C O N F E R E N C E M I L A N, I T A L Y JULY 2004 NEW CHALLENGES IN THE AIR CARGO MARKET

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 3 Table of Contents The Metropolitan Washington Airports Authority –Washington Reagan National Airport –Washington Dulles International Airport The Washington Market Area The Washington Dulles Distribution Center The Metropolitan Washington Airports Authority and Air Cargo The Galaxy Alliance of Airports

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 4 The Metropolitan Washington Airports Authority

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 5 The Metropolitan Washington Airports Authority Manages Two Area Airports – Dulles International and Reagan National Interstate Compact Between Virginia, Maryland and District of Columbia –13 Person Board of Directors –5 - Virginia –3 - District of Columbia –3 - Federal –2 - Maryland

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 6 The Washington Region’s Two Major Airports Serve Distinct Needs Washington Reagan National Airport –Ultra-convenient central location –Metro access –Short haul services Washington Dulles International Airport –In suburban high technology corridor –Domestic and international services –Hub for United and Star Alliance

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 8 Washington Reagan National Airport Plays a Unique Short Haul Role Source: Official Airline Guide June 2004 ALB ATL BDL BHM BNA BOS BTV BUF CAE CHS CMH CRW DAY DEN DFW DTW EWR JFK GSO GSP HPN IND JAX LGA LAX MCO MHT MIA MSY ORD/MDW ORF PWM PVD PHL PIT PHX SEA STL SAV ROC SYR TPA TYS LAS RDU DCA NAS CLE CLT FLL MCI MSP SLC IAH BDA OMA DSM YUL YYZ ACK MVY ILM MEM MKE PBI RSW SDF LEX CVG SBY HHH MYR HSV 14 Airlines 73 Destinations 2,641 departures/week

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 10 Washington Dulles International Airport Is an Important Domestic Airport … Source: Official Airline Guide June 2004 ALB ATL BDL BNA BOS BTV BUF CAE CHS CMH CRW DAY DEN DFW DTW EWR JFK GSO GSP HPN IND JAX LGA LAX MCO MHT MIA MSY ORD ORF PWM PVD PHL PIT PHX SEA STL SAV ROC SYR TPA TYS LAS RDU IAD CLE CLT FLL MCI MSP SLC IAH MEM CVG 12 Airlines 72 Destinations 2,429 departures/week STT SJU PDX SJC SFO SMF OAK SAN LGB AUS ROA RIC CHO MDT ABE BGM SCE LWB Star Alliance Route Non-Star Alliance Route

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 11 … And a Growing International Gateway for Cargo and Passengers Source: Official Airline Guide June 2004 IAD 18 Airlines 25 Destinations 337 departures/week AMS BGI BRU CDG CPH CUN EZE FRA GRU GUA ICN LHR MAN MEX MUC MXP SAL NRT SJO SVO TAB VIE YOW YUL YYZ YVR ZRH Star Alliance Route Non-Star Alliance Route 1/2 Stop Through Plane Service GIG SRZ POS ADD RUH JED LPB MVD

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 12 IAD ATL BOS EWR ORD RDU CAE HPN ORF PWM BNA JAX SYR BTV BUF CHS GSP ROC ALB CRW MHT TYS LAN GSO SAV CLE JFK CMH DAY BDL IND DTW PVD PIT SDF SWF Source: June 2004 Notes: Service begins in August to: SAV, GSO, CLE, JFK, CMH, DAY, IND, BDL, PIT, PVD, DTW, SDF Service begins in September to: SWF Independence Air Will Reinforce Dulles As A Leading Destination for Low Fare Services

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 13 Washington Reagan National Washington Dulles Passenger Traffic at Dulles and Reagan National Source: Metropolitan Washington Airports Authority, 2004 Passengers (Millions) th

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 14 Dulles Continues its Rapid Growth Today 1962Washington Dulles International Airport opens 1987Metropolitan Washington Airports Authority begins operations 1990United Airlines starts Dulles-Frankfurt service 1991United Airlines purchases London routes of Pan Am; starts Dulles-London/Paris 1992First U.S.-Europe open skies agreement with Netherlands 1996Virgin Atlantic inaugurates services as third Washington-U.K. airline 1997Star Alliance created by Lufthansa, United and others. Dulles is eastern U.S. hub 2001bmi British Midland starts services as fourth Dulles-U.K. airline Scandinavian Airlines starts services to Dulles 2002United Airlines services to Sao Paulo, Buenos Aires link Dulles to South America 2004Independence Air chooses Dulles as hub for low fare services Alitalia starts nonstop service between Dulles and Milan Malpensa

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 15 The Washington Airports Enhance the Region’s Strong Economy Source: Martin Associates, 2002

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 16 The Washington Market Area

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 17 Washington D.C. is More Than the Center of U.S. Government Population of Region 5.2 Million: Fourth Largest in U.S. Third Largest Effective Buying Income Per Capita The Capital of the United States … AND … –The world’s leading center for biotechnology research –Headquarters for 15 Fortune 500 companies –Best performing large U.S. city for job creation –Located at the center of the mid-Atlantic east coast road network - a large manufacturing and consuming region –Site of Reagan National and Dulles International Airports

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 18 Washington D.C. is Both the National Capital and a Growing, Sophisticated Urban Community

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 19 Washington Dulles’ Core Air Cargo Catchment Area Includes Extensive Manufacturing of High Value Products Shipped by Air Machinery, except Electrical (SIC 35) includes Computers, Terminals and Peripherals –11,490 Firms –338,335 Employees Electrical and Electronic Machinery (SIC 36) includes Semiconductors, Circuit Boards, and Communications Equipment –3,027 Firms –307,698 Employees Transportation Equipment (SIC 37) includes Aircraft and Aircraft Parts and Aerospace –2,253 Firms –331,170 Employees 10 States and Washington, DC have a Total of 76,776 Manufacturing Firms 836 Firms Export by Air 521 Firms Import by Air PENNSYLVANIA WEST VIRGINIA DELAWARE MARYLAND VIRGINIA NORTH CAROLINA SOUTH CAROLINA GEORGIA KENTUCKY TENNESSEE High Technology Firms and Employment by Industry (SIC Code) Source: US Census Bureau 2002

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 20 The I-95 Corridor is Home to Many World Class Manufacturers and Shippers POWERTRAIN

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 21 The Washington Dulles Distribution Center

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 23 Dulles is the Undisputed Air Cargo Gateway to the Washington Region Source: Metropolitan Washington Airports AuthoritySource: Metropolitan Washington Airports Authority, 2004 Tonnes 350, , , , , ,000 50, th 240, , , , , , , , , ,614

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 24 International Air Freight at Dulles has Grown by More than 900% Since 1980, Far Out-Pacing Total U.S. International Freight Source: Metropolitan Washington Airports Authority, Air Transport Association , ,000 80, ,000 ‘80‘81‘82‘83‘84‘85‘86‘87‘88‘89‘90‘91‘92‘93‘94‘95‘96‘97‘98‘99‘01‘02 Dulles International Cargo US International Freight RPM Index Tonnes ‘03 ‘00

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 25 Dulles Offers an Airfield With Abundant Capacity, With Room to Expand

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 26 Dulles’ RFS Serve Key U.S. Markets in Under 14 Hours – From Aircraft Landing to Destination Loading Dock Source:

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 27 Washington Dulles Airport Offers a Low Cost Business Environment, Compared to Other World Cargo Hubs Such as JFK Lower Landing Fees are One Example of IAD’s Savings Note: Landing fees at JFK and IAD are based on different criteria. JFK on MTOW; IAD on MLW. Source:The Port Authority of NY and NJ, Schedule of Charges for Air Terminals, May 2004; Metropolitan Washington Airports Authority, 2004 Summary of Airline Rates and Charges, January 2004 COST/OPERATION WEIGHT RATE (000) lbs. LANDING TOTAL/YEAR 5 New York JFK606,000 1 $ $3,183.08$496, Washington IAD407,777 2 $ $1,019.75$159, S A V I N G S $2, $337, Maximum Gross Takeoff Weight, A lbs 2 Maximum Landing Weight, A lbs 3 Landing Fee, effective date for New York JFK, May $/000 lbs 4 Landing Fee, effective date for Washington IAD, January 1, $/000 lbs 5 3 Opns/Week

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 28 Dulles Management Works Closely With Cargo Community, Government Agencies DACMA - Dulles Air Cargo Managers Association TSA - Transportation Security Administration USCBP - US Customs and Border Protection

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 29 Cargo Handling

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 30 Washington Dulles World Cargo Center Aircraft and Air Cargo Handlers

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 32 The Metropolitan Washington Airports Authority and Air Cargo

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 33 The Washington Dulles World Cargo Center Supports Its Cargo Airlines – Every Pallet and Every Step of the Way Washington’s Dedicated Cargo Development Program –Assistance with Marketing, Promotion, Problem-solving Customer-focused – 24/7 Cargo-friendly, An Advocate for International Air Cargo Specific Support for Cargo: Washington’s FTD Program

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 34 The F.T.D. Cargo Promotion Program: A Partnership with Dulles’ Airlines Jointly Funded – 50/50 Basis Flexible Cost-effective Program to Help Stimulate Business Provides Quantifiable Support for cargo carriers Builds on a Strong Working Relationship between the Metropolitan Washington Airports Authority and its cargo operators

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 35 The Metropolitan Washington Airports Authority Supports the Air Cargo Industry Provides High Quality and Low Priced Facilities Attracts All-cargo and Passenger Belly Services Promotes Forwarder Consolidation at Dulles Facilitates Cooperative Market Development Publicizes Cost and Revenue Advantages of Dulles Liaison Between Airlines, Forwarders, Government Quality Control of Dulles Services Intervenes in Route Allocation Proceedings Ensures That Regulators and Community Understand Importance of Air Freight Promotes Worldwide Cooperation on Air Cargo Through Galaxy Alliance

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 36 Galaxy Alliance

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 37 The Galaxy Group of Airports Promotes Air Cargo Cargo-friendly Airports Around the World With a Common Vision These Airports Recognize the Unique Needs and Economic Benefits of Air Cargo Galaxy Seeks Better Environment for Air Cargo Through –Liberalization –Solving “doing business” issues –Common standards –Greater public awareness Exchange of Information and Ideas

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 38 Galaxy’s Scope and Founding Members Chateauroux (CHR) Shenzhen Fairbanks Stockholm Bucharest Casablanca Hamilton Sharjah Accra Avalon Milan Kuala Lumpur Washington Dulles (IAD) Koln/Bonn.. Prestwick Dublin Manchester Houston Calgary Johannesburg Venice February 2004 In 1999, the Metropolitan Washington Airports Authority, operator of Washington Dulles International Airport, and Chateauroux Airport in France joined together to establish the International Cargo Airport Alliance.

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 39 Conclusions

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 40 Air Cargo is a Vital Industry that Needs Proactive Stewardship Air cargo is important to the Washington Region The Dulles World Cargo Center is large and rapidly growing The Center offers high quality and attractively priced air cargo facilities The Metropolitan Washington Airports Authority promotes air cargo to enhance regional development The Authority believes international cooperation is a key to the growth of air cargo The Galaxy Group of Airports provides air cargo-friendly airports a network of support The Group lets cargo-friendly airports speak with one voice

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference 41 Richard P. Norris Air Cargo Development Manager Metropolitan Washington Airports Authority 1 Aviation Circle Washington, DC Tel: Fax:

NEW CHALLENGES IN THE AIR CARGO MARKET The Italian Market Air Cargo Conference