2009 Mainports 2040 McKinsey

Mainports 2040
Input for exploration phase long-term vision Mainports
Final report, June 2009

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Waterstaat or VenW) to help VenW gain insight in the environment in which Dutch mainports have to
strategically position themselves.
To this end, this report presents (i) different scenarios and key issues for the mainports (ii) perspectives on the
current position of the Dutch Mainports, and (iii) the main opportunities and threats for the Mainports.
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EXECUTIVE SUMMARY
Key messages
The two mainports create important direct and indirect value for the Dutch economy, even if they are of limited importance in
stimulating the growth of upcoming sectors like tourism and the creative industry
Economic interdependences between the mainports are limited and unlikely to be a key success factor for the individual mainports,
thereby limiting the need for a joint strategy. There are, however, areas of mutual interest that warrant a coordinated approach
Schiphol could grow in volumes by a factor 1 to 7 towards 2040, mainly depending on developments after 2020 (developments
until 2020 outlined in recent policy papers, such as the Luchtvaartnota). Growth beyond a level of 2.5-3x current volumes is likely
to require major infrastructural works with relocation being the most extreme variant. Strategic choices need to be made on the
basis of ambition level, no-regret moves that apply to all scenarios, and belief in the likelihood of specific scenarios. Questions that
need to be addressed are, for instance:
What is the impact on The Dutch Economy, if Schiphol would become an airport with good European connections but limited
direct intercontinental connections?
What is the economic impact (direct and indirect) if Schiphol would become one of the 3 primary European intercontinental
mega-hubs, considering Schiphol would grow with a factor 5-7 of todays volume?
What are no-regret moves that are optimal in all scenarios, such as enlarging the catchment area through better hinterland
connections and adaptive policy making to optimize flexibility around scenario-dependent moves?
A balanced choice needs to be made about which volumes of container cargo Rotterdam wants to attract and how these will be
transported to the hinterland
Rotterdam could grow current throughput volume by a factor 1 to 2.5 until 2040, depending on which long-term CPB growth
scenario will unfold. This growth would primarily be driven by container cargo
Port capacity plans seem sufficient to accommodate growth as liquid bulk, which consumes most port capacity, is expected to
grow maximum with a factor 1.5x versus current throughput. However, this could require targeted policies to optimize the use
of available space and assume no wild swing factor that would trigger a bigger volume increase, such as the rise of
alternative fuels
Accommodating container volume growth would require large infrastructural investments to avoid major congestion issues in
the hinterland, unless the modal split significantly changes thereby lowering the share of road traffic
There might be a need to set priorities between expanding capacity versus policies to make optimal use of current
infrastructure. Questions that therefore need to be addressed are, for instance:
Which cargo flows have the highest value-add and least negative externalities in the Netherlands?
What are the best policy instruments to primarily attract high value-add flows and enforce an optimal modal split?
EXECUTIVE SUMMARY
Chapter 1: Role of the mainports in the economy

The Netherlands is a small, open economy heavily dependent on foreign trade. Having logistical hubs and a strong
infrastructure is a prerequisite for sustaining this position in the future. In this chapter, we assert that the two mainports
create significant value-add for the Dutch economy, even if they are of limited importance in stimulating the
growth of upcoming sectors like tourism and the creative industry
Direct value-add is estimated at ~ 1% of GDP for Schiphol and ~ 2% of GDP for the Port of Rotterdam. Direct value
add is defined as the GDP contribution of companies directly related to the mainports key transport and business
functions
Indirect value-add is estimated at ~2% of GDP for Schiphol and ~1% of GDP for the Port of Rotterdam the GDP. One
element of indirect value-add is the role of mainports in attracting business to the Netherlands
Both mainports play a role in attracting business functions that rely on strong transport connections
Examples for Schiphol are European headquarters or training centers, for which easy transportation of people
is a key success factor
Examples for Rotterdam are European distribution centers, which depend on efficient, low-cost cargo
transportation infrastructure
Both mainports are of limited importance for attracting companies and activities not directly involved in
either mainports key functions
Sectors that merely use the mainports, only require a basic level of connectivity and will not choose the
Netherlands as a location on the basis of its superior logistical hub function. Other factors, such as proximity to
clients, availability and cost of talent, and the tax climate, are more important location decision criteria
The role of the Mainports in supporting the growth of upcoming sectors such as the creative sector and
tourism seems limited
EXECUTIVE SUMMARY
Chapter 2: Interdependence between the mainports

The existence of two major mainports in such close proximity is, within Europe, a feature unique to the Netherlands. The
question remains whether the two mainports owe their position to the existence of the other. If so, how could this
interdependence be exploited and stimulated for the benefit of the Netherlands? In this chapter, we assert that economic
interdependences between the mainports are limited and unlikely to be a key success factor for the individual
mainports, thereby limiting the need for a joint strategy. There are, however, areas of mutual interest that warrant
a coordinated approach
Direct economic interdependence between Schiphol and Port of Rotterdam is limited
Primary interdependence comes from companies that are linked to Port of Rotterdam for their cargo flows and
also use Schiphol to transport personnel and business relations. However, the spin-off effect on Schiphol is
relatively small, contributing less than 1% of total business passengers
Secondary interdependence comes from companies that use both Rotterdam and Schiphol for cargo
transportation. Even though these companies benefit from access to two nearby major logistical hubs, this is
not a key location decision factor, as all competing ports have a major airport within hours by truck
Areas of mutual interest exist for which a coordinated approach could benefit both mainports and the overall
economy:
Although hinterland routes for the mainports differ by nature, easing congestion on one could have a positive
spill-over effect for the other e.g., dedicated rail freight routes would benefit Rotterdam directly, while it would
ease congestion of the passenger rail network, benefiting Schiphol
Focused investments to improve the Dutch logistics talent pool, knowledge development and innovation
could help both mainports to maintain their competitive positions. Logistics knowledge build-up through research
and innovation is likely to have a beneficiary spill-over effect of knowledge for both mainports
Government and related organizations involved in strategy and policy making for the mainports can learn from
each other, which could result in better informed decisions at lower costs
***
As interdependence is limited, strategic choices for each mainport are discussed independent of the other
EXECUTIVE SUMMARY
Chapter 3: Strategic choices for Schiphol (1/3)

Schiphol could grow in volumes by a factor 1 to 7 towards 2040, depending on which long-term growth and airport industry
structure scenario will unfold. Growth beyond a level of 2.5-3x current volumes is likely to require major infrastructural works
with relocation being the most extreme variant. Given the high level of uncertainty surrounding these scenarios, strategic
choices need to be made on the basis of ambition level, no-regret moves that apply to all scenarios, and belief in
the likelihood of specific scenarios
Schiphol could grow in volumes by a factor of 1-7 towards 2040, depending on scenarios for passenger volumes
and airline and airport industry structure developments
Air passenger volume growth is the key factor for determining future capacity constraints. Potential cargo
volume growth is less of a factor as belly capacity free-rides on passenger flight movements and demand growth
and full-freighters make up for only 4% of today's Schiphol flight movements.
Air passenger volume growth will be driven by 5 demand factors towards 2040: real economic growth, degree
of continued globalization, relative cost of flying, access to destinations, and availability of alternatives to flying.
Depending on how the combination of these 5 demand drivers plays out, European air passenger volumes could
grow by between 1 and 5% per annum, resulting in 1.4-5 times today's volumes by 2040
High growth scenario (up to 5 times today's volume): Continued economic globalization and a further reduction in
real cost of flying results in high leisure and business demand growth, in line with pre-crisis estimates of ~5% p.a.
Moderate growth scenario (up to 2.7 times today's volume): Slowdown of economic globalization, combined with
an increase of the real cost of flying, results in moderate leisure and business demand growth of ~3% p.a.
Low growth scenario (up to 1.4 times today's volume): A stop to further economic globalization, combined with a
steep increase in the real cost of flying due to high fuel cost, results in low demand growth of ~1% p.a.
The European airport industry structure primarily depends on the degree of airline consolidation and airport
capacity constraints. Depending on the development of these key factors, the following 3 scenarios could unfold:
Schiphol is no longer a major hub (1-3.5 times today's volume): EU airline sector has consolidated into 3 major
players. Each carrier has concentrated its intercontinental hub activities in one mega-hub , facilitated by a stepchange in airport capacity. Schiphol is not one of these 3 hubs and has become a large 2nd tier airport, with
specialized intercontinental routes and a large European network
EXECUTIVE SUMMARY

Schiphol is still a major hub (1.4-5 times today's volume): EU airline sector has not consolidated much further. The
current airport landscape is still in tact, and all airports have grown at the same pace as far as capacity constraints
allowed them to. Schiphol has maintained its current position as one of the 5+ major European hubs
Schiphol is a mega-hub (1.9-7 times today's volume): EU airline sector has consolidated into 3 major players.
Each carrier has concentrated its intercontinental hub activities in one mega-hub, facilitated by a step-change in
airport capacity. Schiphol has become one of these mega-hubs, with daily connections to more than 100
intercontinental destinations. Paris has been degraded to a large 2nd tier airport
The scenario that unfolds will determine whether major infrastructural investments are necessary
A growth factor up to ~2.5-3 times current volumes can possibly be accommodated at Schiphols current
location, assuming selective policies, technological advances and/or less restrictive noise and environmental
regulation. Measures to handle this growth include:
Overflow to regional airports: Transfer non-hub dependent traffic, especially LCC and charters, to overflow
airports such as Eindhoven and Lelystad
Optimize current use of infrastructure within safety limits and legal constraints, e.g., shorten take-off/landing
intervals; redefine noise restrictions; optimize the slot allocation and queuing system; increase pax/plane
Replace feeder flights with high-speed rail: This would reduce the burden on capacity from feeder flights (e.g.,
Brussels, Copenhagen), although potential impact may be small given the limited number of nearby feeder flights
Expand infrastructure at current location: Extend Schiphol with extra runways at the current location
A growth factor beyond 2.5-3 times current volumes is likely to require major infrastructural works,
relocation being the most extreme of these. Two options for relocation are a dual hub system and a full relocation:
For a dual hub, the connection time between the two terminals should ideally be less than 5-10 minutes;
otherwise, the hub function will be undermined and transfer passengers will choose alternative routes
An airport at sea has been found to be technologically and environmentally possible. Being a first mover could
make Schiphol the largest European intercontinental hub, transforming the Netherlands into Europe's logistical
centre of gravity for passenger transportation. However, there are questions around the cost-benefit trade-off
EXECUTIVE SUMMARY
Given the high level of uncertainty surrounding these scenarios, strategic choices need to be made on the
basis of ambition level, no-regret moves that apply to all scenarios, and belief in the likelihood of the various
scenarios. As the lead time of these types of projects spans several decades, procedures should be started as soon
as possible if the ambition for Schiphol is a growth factor beyond 2.5-3 times current volumes
Define the ambition level regarding the role Schiphol should ideally play within the different scenarios that could
unfold. Questions that would need to be addressed are, for instance:
What is the impact on the Dutch economy, if Schiphol would become an airport with good European
connections but limited direct intercontinental connections?
What is the economic impact (direct and indirect) if Schiphol would become one of the 3 primary European
intercontinental mega-hubs, considering Schiphol would grow with a factor 5-7 of todays volume?
Define no-regret moves that are optimal in all scenarios, such as enlarging the catchment area through better
hinterland connections, optimizing airside access, adapting policy making to optimize flexibility around scenariodependent strategic moves
Define optimal actions per scenario, depending on the ambition level:
Carrier / alliance strategy: Which carrier / alliance should be given priority? Could a multi-carrier strategy be
optimal in some scenarios? What should be done with non-alliance traffic on the hub?
Strategic moves: How should Schiphol expand in the long run? Should it be relocated now, in the future or
never?
EXECUTIVE SUMMARY
Chapter 4: Strategic choices for Port of Rotterdam (1/2)

Rotterdam is the largest port of Europe due to its naturally favorable location: an easy-to-access deep sea port with a
strong hinterland link over the river Rhine to the Ruhr area, combined with a relatively large port area. Rotterdam is by far
the largest bulk port and the number one container port, but faces strong competition for the latter from Antwerp and
Hamburg for the northern European hinterland. A balanced choice needs to be made about the volumes of container
cargo that Rotterdam wants to attract and how these will be transported to the hinterland
Rotterdam could grow current throughput volume by 1-2.6 times until 2040, depending on which long-term
growth scenario will unfold. Containers and new liquid bulks are likely to account for the majority of this growth.
Trade growth up to 2040 will be driven by 7 key volume drivers: real economic growth, delta factor cost between
developing and OECD countries, fragmentation of supply chains, degree of globalization, cost of energy, level of
recycling and depletion of raw materials, and the rise of new (liquid) commodities. Three scenarios could unfold:
High growth scenario: Continued globalization, further specialization of supply chains and rise of cheap
alternative energies and new liquid fuels drive growth of containers to ~6 times and bulk to 1.5 times today's
volumes. It remains doubtful whether a container growth of ~6 times is realistic, as this would imply a tremendous
growth in consumption of physical goods per capita
Medium growth scenario: Moderate economic growth, a continued difference in factor costs and expensive fuel
drive growth of containers to ~3 times and bulk to 1.3 times today's volumes
Low growth scenario: Low economic growth, high transport and energy costs and a no further globalization limit
growth of containers to ~1.5 times, while bulk volumes decline to 0.7 times today's volumes
The scenario that unfolds will determine whether optimized use of currently planned infrastructure is
sufficient, or if a step-change in infrastructural investments is required to avoid major congestion
Container growth: In all volume growth scenarios, planned storage and terminal capacity seem to be sufficient,
but hinterland road capacity constraints need to be resolved
The 2nd Maasvlakte provides enough room for storage and terminal capacity in all scenarios
Both barge and rail have sufficient capacity to handle 3-7 times the current volume, given that the terminals in
the port can digest the volumes for loading and unloading of both modalities
EXECUTIVE SUMMARY
Chapter 4: Strategic choices for Port of Rotterdam (2/2)

Current road capacity is constrained during rush hours. Measures to improve road congestion can help
accommodate container growth of up to 5 times todays volumes:
- Divert all non-domestic trucked containers to other modalities
- Set up a dedicated barged freight corridor to the north of the Netherlands
- Construct intermodal barge and train hubs in the Dutch Hinterland
- Expand the road network around Rotterdam with, e.g., extra lanes on the A15, A20 and A59
- Increase rail capacity, e.g., by building a 2nd Betuwe route and other dedicated rail freight lines
Bulk growth: In a high growth scenario, planned terminal and hinterland capacity seem to be sufficient, but a
step-change in infrastructure would be necessary to secure sufficient storage capacity
Barging and piping to the hinterland have enough capacity to accommodate even the high growth scenario
For growth of up to 1.3 times current volumes, Rotterdam has little free space to accommodate potential liquid
bulk growth. Measures for freeing up capacity using current available space (incl. 2nd Maasvlakte) may include:
- Reducing strategic oil storage in the port by relocating storage to other locations, potentially abroad
- Relocating dry bulk storage (especially ores and coals for foreign countries) to locations outside the port
- Relocating liquid bulk storage capacity to the port of Amsterdam
Beyond 1.3 times current volumes, drastic measures seem necessary to accommodate growth. This might
include constructing a 3rd Maasvlakte
In the face of these capacity constraints, The Netherlands needs to make a balanced choice between volume
growth accommodation and policies to attract cargo flows that add most value to the Dutch economy. In order
to make this decision, several questions need to be answered:
Which cargo flows have the highest value-add and least negative externalities in the Netherlands?
What are the best policy instruments to primarily attract high value-add flows and enforce optimal modal split?
Contents
Role of the Mainports for the economy

Interdependence between the Mainports?
Strategic choices Schiphol
Strategic choices Port of Rotterdam
Appendix - Beantwoording offerte vragen
EXTERNAL
ESTIMATES
Both mainports are of similar relevance to the Dutch economy

Economic value add of mainports, billion1
Estimate of value add Schiphol
2002, SEO (2006) estimates
Net value add (gross value add adjusted for depreciation)
Direct - aviation only
<1%
Direct - other sectors1
Total direct
Transport & communication

Professional services
Distribution
Construction
1
2
3
4
5
6
Estimate of value add Port of Rotterdam

2006, Port area Rotterdam Rijnmond
Gross value add
Transport modes3
Services for transport
~1%
2
3
2
Handing and storage
Direct value add

- transport related
Industry4
Key functions
Direct related
businesses
Indirect
effect
% of Dutch
economy6
~1%
4
Wholesale
Public and private services
Total direct value add including business location

Indirect value add economic multiplier effect5
Total including
indirect effect
12
1
1
Other sectors
Total incl indirect effect
12
~3%
~2%
5
17
~3%
GDP contribution total

Limited number of studies on value-add available, the numbers on this page are based on two recent reports from well known institutions
Dutch port sector
Other Schiphol located but non-aviation activities, such as: distribution, other transport and financial services
estimated at ~6%
Includes the transport modes: road, rail, barge and pipeline
Includes the sectors: foodstuff, petroleum, chemicals, metals, vehicles and electricity production
Multiplier effect of 1.5 direct value add assumed
Schiphol estimates are net value add and therefore compared with Dutch Nett Domestic Product in 2002, estimated at 396 bln by CBS;
Port of Rotterdam estimates are gross value add and therefore compared with Dutch Gross Domestic Product in 2006, estimated at 540 bln
SOURCE: SEO, Economische Effecten Schiphol, 2006; Port statistics 2006; Havenmonitor 2006; CBS; McKinsey analysis
Many businesses interact with the mainports, but close proximity

to a mainport is not necessarily a key location decision factor NOT EXHAUSTIVE
Sectors and
functions
Sectors
which interact with the

mainports in some way
Business
functions
High Tech
Universities and
innovation
Production
Creative industry
Shared
Services Center
Call Center
R&D Center
Marketing and
Sales
SOURCE: Rankings from World Bank Doing Business; McKinsey analysis
which clearly
economically benefit
from being close to one or
both mainports
Agriculture
Energy
Professional
services
Training centers
European HQ
Production/Assem
blage
for which access to

one of the mainports is
a key success factor
Wholesale
Maritime cluster
Petroleum
Repair Centers
Training centers
European
Distribution
BUSINESS FUNCTIONS
The mainports play a role in attracting business functions

requiring physical transportation of people or goods
Very important
Important
Not important
Elements of investment climate

Corporate Availability
Labor
Bureaucracy Ease of
taxes
& costs of
flexibility
access to
skilled labor
key market
Costs of
doing
business
Living
climate
Access
to port
Access
to airport
Languages
spoken
European
distribution
Importance of element for business activity
Marketing
and Sales
European
HQ
Training
center
Production/
Assemblage
R&D Center
Call Center
Shared
Services Center
Repair
Center
SOURCE: Rankings from World Bank Doing Business; Cushman & Wakefield; IMD; OECD; EIA; World Economic Forum;
IMDB World competiveness; McKinsey analysis
BUSINESS FUNCTIONS
No HQ
The Netherlands have not attracted many Asian businesses
1-5 HQs
Non-HQ significant facilities1 of 1802 Asian companies with internationalization potential3
>5 HQs
Denmark: 2
Service Center
UK: 24
x2
NL: 3
Germany: 12
Marketing
Production
Finance
Subsidiary
HR
R&D
Service Center
Media
Distribution
x5
x5
x3
x3
x2
x2
x2
R&D
x1
Service Center
x1
Subsidiary
x1
Sweden
Finland
Norway
U.K.
x1
Production
x1
Czech
France
Hungary
Slovenia
Croatia
Monaco
Portugal
Slovakia
Austria
Switzerland
x1
Marketing
x2
Subsidiary
x1
Corsica
Spain
Marketing
x1
Production
x1
Hungary: 3
Belgium
Luxembourg
France: 2
R&D
x3
Poland
Germany
Production
R&D
Poland: 2
Belgium: 2
x1
x6
Denmark
x1
x1
Subsidiary
Production
Bosnia
Romani
a
Serbia
Italy
Bulgaria
Macedonia
Montenegro
R&D
x1
Marketing
x1
Subsidiary
x1
Italy: 2
Production
Sardinia
Switzerland: 2
Albania
R&D
x1
Production
x1
Malta
x2
Greece
1 All the facilities excluding HQ, sales and branch offices

2 Data not available for 29 of the 180 companies
3 Companies shortlisted on the basis multiple criteria viz. size, internationalization potential etc.
SOURCE: Company websites and reports; McKinsey analysis
Other 9 facilities
scattered across the
Europe in 9 different
countries
BUSINESS FUNCTIONS
For Asian companies transport and accessibility is less

important then other location decision criteria
ILLUSTRATIVE
Relative importance
Key location factors for Asian companies
CEO Awareness of the country

Personal recommendation
Visa & work-permits
Closeness to market
Proof of concept
Direct personal contacts with the country
Image of the country
Tax advantages
International Talent pool
Market size
Part of EU
Transport and accessibility
SOURCE: Swiss-American Chamber of Commerce
BUSINESS FUNCTIONS
The top 3 factors for location decision are access to market,

availability and cost of qualified labor and tax climate
Ernst & Young - European
Headquarters
Cushman & Wakefield - European

Cities monitor 2007
Ministry of Economics Affairs Quickscan 2006
Perception of EHQ location factors

% of total weight
Essential factors for locating a

business
% of respondents (n=500), 2007
Key location factors
Client proximity
23
Qualified staff
62
Transport/accessibility
15
Client proximity
58
Quality & availability

of labor
15
Quality of telecom
55
52
Corporate taxes
Transport
Infrastructure
Centrality
Cost of staff
Airport proximity
Languages spoken
29
Climate of taxes/
financial incentives
27
Other
25
36
1 Headquarters
Multilingual personnel
Proximity to international airports
Corporate tax rates
2 R&D
Availability of qualified personnel
International proximity
3 Distribution & logistics
Corporate tax rates
International proximity/centrality
Quality of labor
4 Production & manufacturing
Availability of skilled labor
Real labor costs
International centrality/proximity
Top 3 elements of investment climate:

Market proximity
Availability & cost of talent
Tax climate
SOURCE: Ernst & Young (2005); Cushman & Wakefield (2008); Ministry of Economic Affairs (2006); Buck Consultants
International (2006); McKinsey analysis
SECTORS
Six industry clusters have been identified as key future growth

areas in which The Netherlands should invest
ILLUSTRATIVE
Economische sleutelgebieden
Renewable energy
Windparks
Rotterdam /
biofuels
Distribution /
Logistics
Rotterdam
Amsterdam
Schiphol
High Tech
Zuid-vleugel
(maritime)
Eindhoven
Detailed
further1
Food
Wageningen
Westland
Creative Industries
Amsterdam-Utrecht
Eindhoven
Chemicals
Maastricht
Eindhoven
Arnhem
Rotterdam
1 Creative industries and renewable energy are potential future high growth sectors for which the interdependence with the Mainports is least well known
SOURCE: Berenschot 2008; Innovatieplatform; McKinsey analysis
SECTORS - CREATIVE INDUSTRIES
Creative business services is the fastest growing segments

within the broader creative industry
Creative industry
Arts
Characteristics
Subsectors
Rarely driving economic
Visual arts
Performing arts
Festivals, events
30,322
57,894
36,317
4.2
2.9
9.9
Occasionally innovative
Partially share of
14,641
14,089
41,588
3,154
n/a
(2.9)
10.2
(11.4)
6.0
n/a
Nearly always innovative Design

Small share of subsidies Architecture
Advertising
in total revenues
Fashion
13,299
59,213
33,739
9,011
58.8
14.8
11.2
24.0
Media and publishing
Creative business services
Contribution Employment
in Dutch
growth for 2004-07
1
employment Percent
innovation
Very high share of
subsidies in total revenues
expositions etc.
Film
Television & radio
subsidies in total revenues Literature & books
Journalism
Digital media
1 Based on data by CBS, measured in 2007 FTEs on SBI93 codes

2 No Dutch employment data available
SOURCE: Broek, Wils and De Kleijn, 2008; Stam, Marlet and De Jong, 2008
SECTORS - CREATIVE INDUSTRIES
The success and relative size of a regions creative industry is

currently not correlated with intercontinental network quality
Number of long haul destinations1
Creative employment of total employment

Indexed, Milan = 100
46
100
Milan
Budapest
93
Helsinki
93
4
19
9
86
Barcelona
15
79
Dublin
64
Leipzig
Amsterdam
57
Munich
57
Sofia
57
50
Poznan
1
68
38
0
0
7
Birmingham
43
Riga
43
Toulouse
43
1 Long-haul defined as a flight lasting at least 6 hours. Schedule for 12 month period ending March 2009 analyzed
SOURCE: Florida, R. (2004), Europe in the Creative Age; Slideshare (2009) - Musterd, S. (2008), Creative Industries in
Europees en regionaal perspectief, OAG; McKinsey analysis
SECTORS - RENEWABLE ENERGY: ETHANOL
Ethanol could make up for more than 5% of liquid bulk throughput

and storage capacity for the Port of Rotterdam by 2020
Ethanol demand worldwide, billion gallon, 2020
Trade flows of ethanol
EU-27
Bioethanol
Breakdown of ethanol demand

Percent
4.3 billion gallon

shipped to Europe
equals ~16 mln m3
Currently Rotterdam is
the biggest biofuel port
in Europe
Assuming Rotterdam
attracts 80% of the
intercontinental traded
biofuels, ~5% of all
liquids in the port could
be biofuels by 2020
100% = 59,7 bln gallon

Europe
11 Traded ethanol
2,1
Local use 89
3,6
NA
0,7
Brazil
Assumptions ethanol
Same subsidies as today
Crude oil price 70 USD / bbl
Tariffs - same as today
Brazil to NA: US$ 0.58/gallon
Brazil to EU: US$ 0.91/gallon
Logistics - same as today
Inland freights + maritime freights
Brazil to NA: US$ 0.16/gallon
Brazil to EU: US$ 0.21/gallon
SOURCE: McKinsey land use and biomass model 2020
Africa
Energetic value of Bio-ethanol is 35 - 40%

lower per liter than most oil based fuels
If bio-fuels volumes would grow

significantly up to 2040, this could cause
problems with storage capacity in the port
SECTORS - RENEWABLE ENERGY: CCS
CCS could address almost half of European CO2 emissions from

fuel combustion and industrial processes
Total emissions1
100% = 4.2 GtCO2, 2007
CCS addressable emissions

100% = 2 GtCO2, 2007
100
Power: gas
Not adressable
by CCS
16
53
6
1
Power: coal 52
Addressable
by CCS
Power: oil
47
Predominantly
large, stationary
sources
9
8
Power: other
Cement
8
Iron & Steel3
Refineries
2007
1 IEA estimates of CO2 emissions from fuel combustion and industrial processes in 2007. Does not include miscellaneous small CO2 emitters and nonCO2 emissions such as methane (e.g. forestry, farming, etc.)
2 Not including biomass, oil sands, paper mills, ammonia, ethanol, ethylene, hydrogen, and other industries
3 Includes metal ores processing
SOURCE: EEA GHG Emission Trends and Projections 2007; IEA World Energy Outlook 2007; McKinsey analysis
SECTORS - RENEWABLE ENERGY: CCS
CCS expected to be economically viable as of 2020, if sufficient funding

for pilot projects becomes available
/tonne CO2 90
Es
ti m
ate
dc
Economic gap
Demonstration
phase: Not
economically
viable in itself
85
80
75
70
65
60
55
50
45
40
35
30
25
20
15
10
5
0
os
to
fC
Commercial
phase: Cost of
CCS likely to
approach the
range of the
future carbon
price
CS
Carbon price forecast*
Demonstration
phase (2015)
Early
commercial
phase (2020+)
Mature
commercial
phase (2030+)
1 Carbon price for 2015 from 2008-15 estimates from Deutsche Bank, New Carbon Finance, Soc Gen, UBS, Point Carbon, assumed constant afterwards
SOURCE: Reuters; McKinsey analysis
SECTORS - TOURISM
Schiphol position as a major intercontinental hub is unlikely

to be a key vacation destination decision factor
Price argument:
flying to Schiphol is
cheaper
Ticket price from Tokyo to

Round trip via Schiphol,
Amsterdam
1,250
Helsinki
1,300
Oslo
1,299
Stockholm
Tourists visiting
The Netherlands
instead of another
European city
because of
Schiphol as a large
hub
+4%
1,301
Milan
Convenience: it
is easier to fly to
The Netherlands
CASE EXAMPLE
1,345
Price differential of ~4% will

not make people choose for
The Netherlands as tourist
destination instead of a city
with a 2nd tier airport
Travel time from Tokyo to

Hours, Airport to Airport1
Amsterdam
Helsinki
Oslo
Stockholm
Milan
1 Oslo and Stockholm are one stop connections via Schiphol, others are direct flights
SOURCE: Destination Holland, NBTC (Nov 2006); AF-KLM website; OAG, McKinsey analysis
11,8
10,3
13,7
12,4
12,4
Travel time differential on

a intercontinental trip only
~1.5 hours on a 12 hour
trip, thus also not likely to
be a key final tourist
destination decision factor
+5%
SECTORS - TOURISM
Intercontinental tourists do not seem to visit The Netherlands to

benefit from Schiphol as easy access point into Europe
Total tourism spend in The
Netherlands by residents from
2005, mln
UK
Germany
Belgium
Most popular combinations

with a visit to The Netherlands
2005, mln
874
628
192
France
139
Italy
100
Spain
135
Scandinavia
USA
Germany
France
Belgium
UK
Ireland
Japan
Italy
UK
Belgium
Germany
France
159
Other Europe
346
Total Europe
2,573
US
279
Japan
55
Other intercontinental
639
Total
3,546
Other intercontinental
guests
Germany
France
Belgium
UK
Italy
SOURCE: Destinatie Holland - de buitenlandse toerist nader bekeken, NBTC; McKinsey analysis
More then 70% of foreign tourism

spending in The Netherlands
comes from residents of
European countries
Intercontinental guests(<30% of
spending) tend to combine a visit
to the Netherlands with countries
that also have good
intercontinental connections
Therefore, these tourists do not

seem to visit The Netherlands
because of Schiphol
Contents

Some sectors use both Schiphol and Rotterdam

for transportation of cargo and/or people
BASED ON KIM REPORT

QUALITATIVE ASSESSMENT
High use of flow
Medium use of flow
no use of flow
Flow
Business
clusters using
one or both
mainports1
Schiphol
Pax
Rotterdam
Perishables
Express
High value
products
Dry bulk
Liquid bulk Containerized

products
Agriculture2
Petroleum
High Tech
Wholesale
Professional
services
Maritime
cluster3
Only High Tech and Wholesale have limited over-lap

in Cargo flows
Many business clusters use Schiphol for pax and Rotterdam
for cargo, suggesting economic spin-offs exist
1 Business clusters as defined by KiM that extensively use one or both of the mainports
2 Export mostly flowers, import grain, fruit and vegetables
3 Shipbuilding, offshore, and maritime construction
SOURCE: KiM: Synergie tussen de Mainports?; McKinsey analysis
Some direct economic spin-off exists between the two mainports
Schiphol benefits from pax

generated by Rotterdam
An estimated 130k-500k Pax are

generated by companies directly
linked to the Port of Rotterdam
Lets assume 80% of these Pax will fly

through Schiphol
Even then, with a total annual

business volume of ~17.5 million pax,
this equals to 0.6-2 % of total Schiphol
business passengers, less than 1%
of Schiphol pax volume
SOURCE: Port of Rotterdam, Schiphol, Airport Emission Control; McKinsey analysis
Rotterdam benefits from the need for

kerosene by Schiphol
Schiphol requires approximate 600 mln liters

of kerosene each year
This kerosene is transported from the Port

of Rotterdam to Schiphol by barge and
pipeline
Schiphol demand for kerosene equals ~1.1%

of the total annual oil products throughput ,
which equals ~0.3% of annual liquid bulk
throughput of the port of Rotterdam
Port of Rotterdam generates less then 1% of Schiphol

business passengers
Pax Generated
by employees
of port related
companies
Total Pax
generated by
Rotterdam
Pax Generated
by Port of
Rotterdam for
Schiphol
Pax generated
by customers
visiting
companies
Pax generated
by consultants
helping
companies
% of Pax
generated by
Rotterdam that
uses Schiphol
Pax Generated
by direct port
related
companies
Pax Generated
by indirect port
related
companies
BACK-UP
INDICATIVE
80.500 employees directly working the port

Due to local nature of work, 5-10% is expected
to travel by air
Average annual travel by air per person 2-10
60.400 employees indirectly working the port

Due to service orientated nature of work, 10-20
% is expected to travel by air
Average annual travel by air per person 2-10
Approx 2.500 companies connected to Port

of Rotterdam
On average an estimated 20-50 customers visit
these companies
Approx 2.500 companies Connected to Port

of Rotterdam
On average 20-50 (technical) consultants flying
in on a yearly basis
Estimated maximum of 80% of total Pax
generated to fly from Schiphol
Rotterdam Airport expected to accommodate
at the remaining (i.e., minimum 20%)
Total business related PAX

generated by Port of Rotterdam
and flying on Schiphol: 0.1-0.4 mln
SOURCE: McKinsey analysis
Having an airport close to a major port is not a unique feature

within the western European port sector
Most large ports have a major airports nearby
ILLUSTRATIVE
which makes the proximity of

Schiphol to Rotterdam not unique
Port
Airport
All large NW European ports have a

International air passenger hub
within hours of driving distance
All ports have International air

cargo hubs within hours of driving
distance
All ports have small local airports,

convenient for flying e.g. technical
staff in and out
Despite not having an international airport, Hamburg has been able

to attract Chinese business through creation of a Chinese community
Pillars of the Chinese-German community
Examples
Hamburg has a welcoming attitude towards Chinese

people
Chinese healthcare practitioners are supported
There is a large number of Chinese organizations
There are good distribution facilities
Relationships
Business
Research
Politics
Culture
There are cultural events for the Chinese
community in Hamburg
There are large cultural events to educate
Hamburg about the Chinese culture
SOURCE: Press search; McKinsey analysis
CASE EXAMPLE
All official documents and websites are translated

into Chinese
The country leads in education of Chinese medicine
There are Chinese sector associations (e.g., law, IT,
food, culture)
Port of Hamburg is the largest Chinese distribution
centre of Europe
Sector conferences of Chinese and German

businesses
Most active student exchange program between
Europe and China
Shanghai is twin city of Hamburg
Ex-chancellors and the Chinese prime minister are
involved in establishing relationships between
politicians
Many Chinese cultural associations

3-day city event that involves high-profile Chinese
and German politicians / CEOs
Hamburg is Chinas leading investment hub
400 Chinese companies in Hamburg
Port of Hamburg is the most important trading partner of
China, processing 25% of the Chinese export to Europe
Chinese expats consider Germany the most attractive
country to settle after the US
Although there is limited direct economic interdependence between the

mainports, there are areas of mutual interest
Hinterland
connections1
Talent pool,
knowledge and
innovation
Impact on Mainports
Advantages of combined approach
Solid hinterland connections will help
Although hinterland routes for both main-
secure and extent Schiphol O&D

catchment area
Low congestion on hinterland
connections is necessary for Rotterdam to
continue its growth, especially in
containers
Competitive position of Schiphol as a hub
highly depends on quality and service of

its labor force
Rotterdam's competitive position is
partly due to its relatively high skilled
labor force and resulting high quality of
service
Mainports benefit from sound policies

Strategy and
policy making
and regulations
ports differ by nature, easing congestion

on one, could have a positive spill-over
effect for the other e.g., dedicated rail
freight routes would benefit Rotterdam
directly, while it would decongest the
passenger rail network, benefitting
Schiphol
Focus on education of labor force in
logistics could benefit both mainports in

maintaining their competitive positions
Logistical knowledge build-up trough
research and innovation is likely have a
beneficiary spill-over effect of
knowledge for both mainports
Government and related organizations

involved in strategy and policymaking for
both mainports can learn from each other,
which can result in better informed
decisions at lower costs
1 In practice, both mainports are also competing for funds, as public funds to invest in infrastructure are limited
2 Quantitative ambition commission van Laarhoven (Innovation program logistics and supply chains): increase value add from ~ 3-10 bln by 2020
SOURCE: Expert interviews; DGLM interviews; McKinsey analysis
Contents

Schiphol currently in first league of European intercontinental airports

12 month period ending March 2009
Number of longhaul
destinations1
"First
league"
"Second
league"
"Third
league"
(examples)
LGW
MXP
MAD
FCO
MAN
MUC
BRU
ZRH
DUS
ORY
HEL
LIS
DUB
VIE
CPH
ARN
ATH
BCN
GVA
PRG
LYS
MRS
WAW
BUD
Weekly long-haul seat

capacity offered,
outbound seats 000
98
97
85
68
CDG
FRA
LHR
AMS
Average daily frequency of flights2 by

destination
68
44
41
41
41
38
35
30
27
21
19
17
15
15
12
11
9
9
6
6
6
6
5
4
New York
234
215
11.8
6.7
408
153
Hong Kong
3.2
2.4
26.0
10.2
Tokyo
4.9
3.0
4.7
2.0
6.8
2.0
61
28
96
51
35
48
32
41
19
34
20
23
23
17
18
13
2.0
3.6
4.6
6.5
4.0
1.9
4.9
4.8
1.5
2.5
0.9
1.9
4.8
0.9
1.8
2.2
0
0
0
1.0
0
1.0
0
1.0
0
0
1.0
0
0
0
0
0
0
1.0
0
1.4
0
1.0
0
1.0
0
0
0.6
0
0
0.8
0.9
0
9
8
6
4
3
2
5
3
2.2
3.3
2.4
0.9
0.4
0
1.4
1.0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Three
"leagues" of
airports can
be identified in
long-haul
offering
Schiphol
currently in
top league
1 Flights lasting more than 6 hours included

2 Weekly number of connections divided by seven
SOURCE: Back Aviation Solutions OAG database; McKinsey analysis
Small home market is a potential threat for Schiphol attractiveness

as a hub location, however relatively good score on other key factors
(Intercontinental) hub key success factors
EXPERT
OPINION
Evaluation of major EU hubs vs key success factors

Schiphol
Large home market, .i.e. high O&D

volume
Frankfurt
London (LHR)
Paris
Strong infrastructure and

sufficient expansion options1
Favorable location (center of, e.g.,

continent)
Other (e.g., weather, quality,)
Schiphol and Frankfurt are well positioned to serve as
major EU hub and have strong infrastructure, small home

market is primary weakness
London, although it has a strong home market, suffers from
bad weather, sub-optimal geographical location and
congested infrastructure
Paris has a strong home market, good location, good
weather, but is a question mark due to its bad infrastructure
1 Includes hinterland connectivity (landzijdige bereikbaarheid), Airport infrastructure as well as airside connectivity (luchtzijdige bereikbaarheid)
SOURCE: Expert interviews; McKinsey analysis
Within the top-league, Schiphol has least long-haul destinations

and is relatively dependent on transfer passengers
Airport breadth and depth
12 month period ending March 2009
Passenger composition
Million, 2007
Frequency1
Daily average
3.0
2.5
3th
league
2nd league
Transfer
O&D
55
45
FRA
1st league
100% =
53
LHR
AMS
2.0
59
41
46
1.5
AMS
1.0
CDG
FRA
0.5
LHR
35
CDG
32
65
68
68
57
0
0
20
40
60
80
100
Long-haul destinations2
Number
LGW
13
87
35
1 Number of annual flights divided by 365

2 Flights lasting more than 6 hours included
SOURCE: OAG; UK CAA; McKinsey analysis
Schiphol physically has most room for infrastructure expansion

Hectare of available land for expansion within a 20x20 km area around the airport
Capacity for runways
1,000 2,000 3,000 4,000 5,000 6,000
Dubai
Amsterdam
Madrid
London Stansted
Paris CDG
Rome
Frankfurt
London Gatwick
Munchen
Helsinki
Barcelona
London LHR
Brussels
Milan Malpensa
Copenhagen
Vienna
Weeze
Koln
Liege
Istanbul
Luxemburg
Zurich
Paris - Charleroi
Dusseldorf
Manchester
Capacity for businesses
Within Europe, Schiphol has most

room for business expansion
Schiphol also has most room for

runway expansion1
However, actual expansion

potential dependent on restrictive
policies, such as noise restrictions
1 Not taking the effect of noise and other restrictions on actual capacity into account
SOURCE: Internationale benchmark capaciteit luchthavens, Kennisinstituut voor Mobiliteitsbeleid; McKinsey analysis
Schiphol is relatively constrained in its airside access, but easily

accessible by land
Together with Heathrow, Schiphol is very constrained on the
airside access of the airport
Usage of landing and take-off slots within legal constrains, 2007
Journey time to
city centre by train
minutes
Available slots
Used slots
Paris (CDG)
Frankfurt
90
10 539
97
489
Schiphol
97
450
89
29
705
London (LHR)
London (LGW)
Frequency of
train connection
Per hour
# of
parking
spaces
100% =
23
77%
Schiphol is 2nd best airport with regard to ease of access by

land after Frankfurt
Ground access, 2003
11 291
10
15,970
4-6
16
36,500
#1 10
#1
30
SOURCE: Internationale benchmark capaciteit luchthavens, KiM; Airport capacity profiles, IATA; McKinsey analysis
18,220
#2
29,900
27,000
Schiphol profits from being in a highly accessible location for transporting air cargo in to Europe, with fierce competition however
Top 10 European Airfreight Airports
Million metric tons, 2007
European Trucking Accessibility Map

Based on time travel matrix1
2.1
2 Frankfurt
2.1
1.6
3 Schiphol
10
4 London (LHR)
1 Paris (CDG)
6 8 7
5 2
1.3
0.9
5 Luxembourg
6 Brussels
0.7
7 Cologne
0.7
8 Liege
0.5
9 Milan (MXP)
0.5
10 Copenhagen
Low accessibility
0.4
High accessibility
1 The travel time matrix and resulting accessibility indicator for trucks, i.e. for good transport, can be interpreted from the perspective of producers
on (potential) markets as the answer to the question which location has the highest market potential
2 Top ten share of total volume transported is 64%
SOURCE: ACI; IRPUD; McKinsey analysis
While Schiphol is a large cargo airport, relatively air cargo is less

important than passenger for understanding future capacity constraints
Amsterdams position as a major cargo airport
seems secure due to its size
Air cargo throughput, 2007 1000x tons
Frankfurt / Main
Paris De Gaulle
Schiphol
London Heathrow
Luxembourg
Brussels
Cologne / Bonn
Liege
Milan Malpensa
Copenhagen
Istanbul
Madrid
East Midlands
Zurich
Munich
London Stansted
Vienna
London Gatwick
Manchester
Milan Orio al Serio
but Liege took off during that last 10 years

Freight activity, 1000x tons
2,074
2,053
1,610
1,314
856
738
705
490
471
396
333
322
275
265
251
207
192
171
166
134
164 208
1
35
1994 95
96
97
98
270 273 327
99 2000 01
02
374 382
03
04
326
05
406
06
490
07
Pax flights are significantly larger in volume to

than full freight
Percent of total number of flight movements, 2006
Full
LCC Freighter Major carriers
Schiphol
20
76
100%
As full freighters account for only 4% of all

Schiphol flight movements, the remainder of
this chapter focuses on passenger demand
SOURCE: Sowaer website; ACI; Helder Kiezen, keuzes helder maken; McKinsey analysis
There are 5 key drivers of air passenger volume growth towards 2040
High
Low
Description of trend
Change in trend?
Impact of driver
Past
1
Real economic
growth
2
Continued
globalization
Real GDP growth is the key driver of air

travel demand: more business means
more travel and more GDP per capita
means more leisure demand
Future economic growth

uncertain, but will still be a key
driver of air travel demand growth,
question is at what multiplier?
Globalization increases the need for

business travel to meet with overseas
business relationships
Global social networks and VFR1 trips
increase
Decreasing cost of flying (in real terms)
has been a key driver of traffic growth,
especially leisure demand
Globalization may continue, but

may also flatten out as a response
to current economic crisis
Key question mark is cost of

(alternative) fuels and climate
taxes
Increased offering of number of

destinations and frequency
Trip time decreased
There is a physical limit to

improvement of access and
marginal utility of increasing
frequency declines
Land travel: train, car

Communication: video conferencing, virtual
meetings
High speed rail will play an

important role on intra EU traffic
Virtual meetings impact on
business travel is a question mark
3
Cost of flying
4
Access to
destinations
5
Alternatives
to flying
Future
1 Visits to Friends and Relatives

SOURCE: Expert interviews; McKinsey analysis
1 Economic growth has been the key driver of global passenger volumes
Correlation between yoy change in real GDP and global passenger numbers, 1971-2007
BACK-UP
Normal GDP-air travel
growth correlation
Economic shocks
Year on year change in global

airline passengers carried, %
15.00%
2004 recovery
y = 2.0562x - 0.0166
R2 = 0.536
10.00%
1974, 75 stock
crash, oil
1982,
Year on
recession
year change
0.00%
in global
real GDP -3.00% -2.00% -1.00% 0.00%
%
-5.00%
Historically, there
is a reasonably high
correlation (R of 0.70)
between changes
in real GDP and
passenger numbers
However, during
shocks to the
economic system this
relationship is broken
1973 stock
crash, oil
5.00%
Expectation
given GDP
change, 2009
1.00%
2.00%
1991, Gulf War
3.00%
2002
(post9/11)
4.00%
5.00%
6.00%
7.00%
Observed
YTD, 2009
-10.00%
SOURCE: Worldbank World Development Indicators; ICAO; McKinsey analysis
2 Globalization is an important underlying driver of air passenger volume

ILLUSTRATIVE
Air travel to
do business
Explanation
Evidence
Increasing business links between
Number of seats (mln seats per annum both
China and Europe

Value of FDI of European countries in
China increased with an ~18% CAGR
between 2000 and 2005*
Airline capacity offered between China
and Europe also increased
substantially
ways combined) offered on flights between

China,HK and EU increased by 10% p.a.
+10%
5
11
11
12
2000 2001 2002 2003 2004 2005 2006 2007 2008
International
labour
movement
A high number of Indian people are
currently employed in Dubai working

eg in the hospitality industry and in
construction
This has also led to substantial
increase in air flows between Dubai
and India
Number of offered seats on Emirates flights
from Dubai to India increased from 306

thousand in 2000 to 1.8 million in 2008
At the same time, the number of
destinations in India served by Emirates
increased from 4 to 10
1 Austria, Czech Rep, Denmark, Finland, France, Germany, Italy, Netherlands, Norway, Poland. Portugal, Switzerland, UK taken as sample for Europe
SOURCE: SOURCE: Innovata schedules via APGdat, OECD; McKinsey analysis
3 Cost of flying decreased significantly

Passenger yield1 European carriers2, constant, USD cents / RPK
17,5
17,0
16,5
16,0
15,5
15,0
14,5
-26%
14,0
13,5
13,0
12,5
12,0
11,5
11,0
10,5
10,0
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
1 yield = passenger revenue / revenue pax km

2 Association of European Airlines members only, system wide traffic
SOURCE: AEA; McKinsey analysis
SYNTHESIS OF 21
PREVIOUS STUDIES
3 Leisure demand is most sensitive to price changes
Market segment
Number
Number of
of studies estimates
Long-haul international business
16
Long-haul international leisure
49
Long-haul domestic
business
26
Long-haul domestic
leisure
16
16
Short-haul business
Short-haul leisure
-2
-1.5
-1
-0.5
Rationale
Paid for by company;

no substitutes
One part of trip spend

but no need to travel
Paid for but has some

land substitutes
One part of trip spend

but no need to travel
Paid for but has many

land substitutes
Opportunistic pricedriven booking
Elasticity
More
Less
SOURCE: Air travel demand elasticities - Concepts, issues and measurement, Gillen, Morrison & Rietveld (2002)
3 At consistent high fuel prices airlines may change their behavior,

reducing frequencies in order to increase load factor
Percentage of total operating costs for an average stage-length
100
60
Fixed cost1
Other
variable cost2
Fuel cost
26
14
50
100
55
24
100
51
22
100
48
As fuel costs increase, airlines

may change their behavior
In a fixed cost environment,

20
21
27
32
80
110
140
airlines were prepared to

discount seats heavily to
contribute to their fixed cost
base
With variable costs above

50%, airlines may be prepared
to reduce frequencies and
only fly when the aircraft has
adequate yield
Price of jet fuel

$/bbl
The industry break-even oil price is around ~$95/bbl,
at which point variable costs are ~45% of revenue
1 i.e., in the near term, cost is not affected by the load factor or the number of frequencies flown
2 Most variable cost (including fuel) varies mainly according to the number of frequencies flown rather than the load factor
SOURCE: Airline industry fuel model; annual reports; Airline Business; press searches; McKinsey analysis
4 Ease of access to far-away destinations increased over time
CASE EXAMPLE
Kangaroo route in 1947
55 hours needed to fly the route, excluding

stopovers
6 stopovers, including two overnighters: LondonTripoli-Cairo-Karachi-Calcutta-Singapore-DarwinSydney
Lockheed Constellation flying the route, carrying 29
passengers
Average Australian needed to work 130 weeks to
buy a return ticket
Kangaroo route now
21.8 hours needed to fly the route

One stopover (e.g., in Bangkok, Singapore, Hong
Kong)
B747-400, B777, A380 flying the route* carrying
between 224-525 passengers
Average Australian needs to work 2 weeks to buy
a return ticket
SOURCE: OAG; press articles; McKinsey analysis
5 High speed rail is a substitute for short-haul flights
Airplane
Market shares, percent
Eurostar
Market share on Paris-London Route

100
100
100
100
36
31
29
28
Market share on Brussels-London Route

100
52
64
69
71
2004
2005
SOURCE: UK CAA; Press Research; McKinsey analysis
100
100
44
39
35
56
61
65
2004
2005
2006
72
48
2003
100
2006
2003
Long-term scenarios are formulated as combinations of these 5 factors

Positive
G
ec lob
on al
om re
a
ic l
gr
ow
C
o
gl n
th
ob tin
u
al e
iz d
at
io
n
C
os
to
ff
ly
in
A
g
c
de ce
st ss
in t
at o
io
ns
A
l
t
to er
fly na
in tiv
g es
Global scenario
High
growth
~5%
~3%
~1%
SOURCE: Expert interviews; Workshop discussions; McKinsey analysis
CAGR, %
Economic scenario
Impact on air travel demand
Continued economic globalization

resulting in high economic growth
and further supply chain
specialization
Further reduction in real cost of
flying, driven by technological
advances and plenty available alternative energy at reasonable cost
Stable economic globalization

resulting in moderate economic
growth and stable supply chain
specialization
Real cost of flying flattens out,
driven by and high cost of fuel and
limited technological advances
De-globalization resulting in low

economic growth and reversed
supply chain specialization
Real cost of flying flattens out,
driven by and high cost of fuel and
limited technological advances
Low
growth
... Growth
Description of scenario and impact on air travel demand
Moderate
growth
Negative
High leisure demand

growth due to low ticket
and global social and
business networks
High business demand
growth due to high economic growth and continued
economic globalization
Moderate leisure demand
growth
Moderate business
demand growth
Low leisure and intercontinental business

demand growth
Moderate intra-Europe
business demand growth
Volume growth under these scenarios could vary from 1-5% p.a.
Boeing growth
rate forecasts
Assumptions vs
Boeing forecasts
CAGR, %
Scenario summary
description
Global scenario
High
growth
Moderate
growth
Low
growth
~5%
~3%
~1%
Continued economic globalization

Further reduction in real cost of
flying
High leisure demand growth
High business demand growth
2007 volumes
RPK, trillion
From EU to
EU
NA
ASIA
ROW
Total
0.6
0.4
0.4
0.4
1.8
Stable economic globalization

Real cost of flying flattens out
Moderate leisure and business
demand growth
EU
NA
ASIA
ROW
Total
0.6
0.4
0.4
0.4
1.8
Stop to further globalization

Real cost of flying flattens out
Low leisure and intercontinental
business demand growth
Moderate intra-Europe business
demand growth
EU
NA
ASIA
ROW
Total
0.6
0.4
0.4
0.4
1.8
SOURCE: Boeing; workshop discussions; expert interviews; McKinsey analysis
Growth
assumption
CAGR, %
2040 volumes
RPK, trillion
2.0
3.5
1.9
4.7
2.4
5.7
5.0
>4x
2.0
3.0
4.0
3.5
1.5
1.0
1.0
1.5
2.0
8.2
1.2
1.1
1.4
1.2
~3x
4.9
1.0
0.6
0.5
0.6
<2x 2.8
Pre-crisis market forecasts support the high growth scenario

of 5% growth per annum
RPK, trillions, 2000-2027
Boeing
5.0
10
Airline
Monitor
4.8
Airbus
4.6
12
Actuals
CAGR
07-27
Global passenger growth

14
BACK-UP
6
4
Market forecasters see

continued strong
growth in global pax
The Boeing detailed

growth rate forecasts
for EU traffic are used
as proxy for the High
Growth Scenario
2
0
2000
2007
European passenger growth1
2027
5
4
3
2
EU-EU
3.5
EU-NA
4.7
EU-ASIA
5.7
EU-RoW
5.0
1
0
2000
2007
2027
1 Based on Boeing detailed traffic outlook per region

SOURCE: Boeing, Airbus, Global Insight; McKinsey analysis
Airline consolidation and airport capacity constraints are key

determinants of what the EU airport industry will look like in 2040
EXPERT
OPINIONS
High
Low
Description of trend
Importance
Airlines are consolidating to increase scale

economies
In a low growth scenario with airport

overcapacity, airlines with multiple hubs in
close proximity might rationalize the hub
function
Currently all major European airports are

facing serious capacity constraints
Large ME carriers (e.g. Emirates) with a

favorable geographic hub location
compete for traffic
In a high growth scenario without a step

change in capacity by 1 or more of the 1st
tier EU airports, growth will defer to 2nd tier
airports and hub consolidation will not
occur
EU hubs maybe bypassed on increasing
number of routes when these carriers get
equipment that can economically make
these alternative connections
Larger equipment (A380) for trunk routes

and specialize smaller equipment for longhaul direct connections make more
combinations possible
The market has seen an inflow of LCC and

point-to-point players, flying directly
between peripheral cities and even
creating completely new routes
Carrier
consolidation
Airport capacity
constraints
Competing nonEU hubs/carriers
Specialized
airplanes
Rise of LCC
Impact on EU airport sector
Large economic equipment increases shift

towards mega hub consolidation
Specialized long-haul equipment enables
carriers to bypass large hubs
Pure LCCs do not compete with mainline
carriers for traffic on key routes between
large cities
1 depending on degree of airline consolidation, which is a driving factor

SOURCE: DGLM interviews; Expert interviews; McKinsey analysis
Key question is to what extend hubs will consolidate into mega hubs
and what the role of Schiphol could be under such a scenario
Scenario need to believes
A Schiphol not a hub

anymore
3 large EU hubs
B Schiphol still a hub

>5 large EU hubs
Size of Schiphol
Scenario name
C Schiphol grows into

a mega hub
3 large EU hubs
EU airline sector has consolidated into 3 major players

Each carrier has concentrated its intercontinental hub activities into one large
mega hub, facilitated by a step-change in capacity by these airports
Schiphol is not one of these 3 hubs, and has become a large 2nd tier airport,
with specialized intercontinental routes and a large European network
EU airline sector has not consolidated much further OR airline consolidation

has not resulted in hub consolidation due to airport capacity constraints
Current airport landscape still in tact, all airports have grown at the same
pace as far as capacity constraints allowed them to.
Schiphol has maintained its current position as one of the 5+ major
European hubs.
EU airline sector has consolidated into 3 major players

Each carrier has concentrated its intercontinental hub activities into one mega
hub, facilitated by a step-change in capacity by these airports
Schiphol has become a large mega hub with daily connections to more then
100 intercontinental destinations
SOURCE: Expert interviews; DGLM interviews; workshop discussions; McKinsey analysis
Schiphol passenger volume could be 1-7x current volumes by 2040
ESTIMATES
Schiphol 2040 passenger volume growth scenarios, indexed, volumes 2007 = 1

A Schiphol not a
hub anymore
3 large EU hubs1
O&D
B Schiphol still a C Schiphol grows

hub
into a mega hub
5 large EU hubs1
3 large EU hubs1
Total
Can growth be
accommodated at
current location?
10.0x
High
growth
5.0x
~5%
Uncertain
1.3x
No
3.5x
5.0x
7.0x
Assumptions:
Today ~40% of passenger
volumes is transfer
5.3x
Moderate
growth
Low
growth
~3%
~1%
Yes
5.0x
5.0x 5.0x
0.7x
Transfer
2.7x
1.9x
2.7x
0.3x 1.4x
1.4x 1.4x
1.0x
1.4x
SOURCE: Workshop discussion; McKinsey analysis
2.7x
2.7x 2.7x
3.7x
2.8x
If Schiphol not a hub, it looses

75% of transfer passengers
If Schiphol becomes a mega

hub, transfer volume doubles,
as Schiphol takes over transfer
passengers from other hubs.
This is on top of autonomous
market volume growth
1.4x
1.9x
Beyond 2.5-3x volume growth, relocation of Schiphol might be necessary

INDICATIVE
ESTIMATES
Actions
1x
Transfer non-hub dependent traffic,

especially LCC and charters, to
overflow airports such as
Eindhoven and Lelystad
E.g. shorter takeoff/landing intervals;

optimize slot allocation and queuing
system; reconsider noise restrictions;
more pax/plane
Reduces burden on capacity from

feeder flights (e.g., Antwerp,
Brussels, Copenhagen, )
Extent Schiphol with extra runways

at current location in order to
increase capacity within noise /
environmental boundaries
Overflow to
regional airports
Optimize use
of current
infrastructure
Replace shorthaul traffic by
train
Physical runway
optimization at
current location
Expand at
alternative
location or
relocate
2x
3x
multiplier
4x
5x
6x
7x
8x
x1.2
X1.5-2
x1.1
Build new airports or expansion

within 5-10 minutes by super fast
train to current Schiphol (e.g.,
Singapore)
Low Growth
Moderate growth,
Schiphol not a hub Schiphol still a hub
SOURCE: workshop discussions; McKinsey analysis
x Capacity increase
Volume growth factor Schiphol 2040 vs 2007
Rationale
>8x
High growth,
Schiphol still a hub
High Growth
Schiphol a mega hub
Schiphol could increase capacity by outplacing non-hub traffic

Percent of total number of flight movements, 2006
LCC LCC- leisure

Full
business motive & Charter Freighter
Schiphol
12
24
Currently, 24% of Schiphol flight movements

do not contribute to the hub function
Paris (CDG)
17
By moving charters and LCC with leisure

motive to regional airports, Schiphol can
free-up 8% of current capacity
Frankfurt
London (LHR)
If LCCs with a business motives also would

be moved, Schiphol could free-up 20% of
current capacity, creating room to increase
hub related capacity by 25%
SOURCE: Lange Termijnverkennning Schiphol; Helder Kiezen, keuzes helder maken; McKinsey analysis
Schiphol could potentially double its capacity at current location

Schiphol Airport passenger capacity, million pax per year
Impact of measures on passenger capacity
Million
Current operations
Assumptions / rationale
47
Headroom capacity
within current constraints
13
Current foreseen maximum
60
Technological advances planes make less noise
10
Technological advances larger planes
10
Capacity after technological advances
80
Policy - stimulate use of larger planes
INDICATIVE
ESTIMATES
10
2008 total pax handled 47 million
Current terminal capacity 60 million pax
New aircraft are 50% quieter than aircraft 10 years ago;

IATA expects a 50% reduction in noise by 2020
Trend towards larger equipment, especially for truck

routes (e.g. A380)
Average aircraft size at LHR is currently 28% more than

at AMS (195 seats versus 152 seats)
Policy - enforce use of

quiet planes
0-10
Use landing charges to incentivize use of quieter planes
Policy less restrictive regulation
Relaxation of regulation to increase competitiveness
Capacity after
policy measures
~100
~ 2x current traffic of
50 mln pax per annum
SOURCE: Lange termijnverkenning Schiphol; Jaarverslag Schiphol Group 2008; IATA; OAG; ACI; McKinsey analysis
Substitution of feeder flights by HSL is estimated to have a

small impact, unless all short-haul flights would be substituted
Feeder flights on destinations within 500-800 km
can be partly substituted by High Speed Rail
Number of flight movements that can be substituted
Paris
London
5,800
Assumed
substitution %
49
3,100
Estimated effect of substitution <3% of

total flight movements
Brussels
800
60
If 100% of traffic could be substituted,
Frankfurt
300
11
This excludes the extra traffic that will
Other1
5,000-11,000
Total
15,000-21000
impact could be substantial at >100.0002

flight movements or 17% of capacity
be attracted as the effective catchment
area is being enlarged
na
~3
Current total number

of flight movements
of ~450.000
1 Other European spokes within 500-800 km from Schiphol, such as Munich, Zurich, Lyon, Geneva, Copenhagen
2 Assuming 100% substitution for Paris, London, Brussels, Frankfurt and the lower range of other (assuming 10% substitution for original estimate)
SOURCE: Lange Termijnverkennning Schiphol; McKinsey analysis
Contents

The port of Rotterdam is the largest European port, especially

in the dry and liquid bulk segments
Rotterdam is the biggest port of Europe
especially in bulk, while it has similar container volumes compared to

its main competitors
Total throughput 2006-07, Mln tons
Total dry bulk throughput 2007, Mln tons

2003
2007
Delta
2003-07
100
200
300
400
Market share
Rotterdam
91
49%
51
25
27
5
500
Rotterdam
24%
Antwerpen
28%
Hamburg
32%
Amsterdam
34%
Le Havre
10%
Bremen
42%
Duinkerken
14%
Wilhemshaven
8%
Gent
-5%
40
15
27
17
46
2
14
41
Total container and general cargo throughput 2007, Mln tons

119
Other general
99
26%
PoR
Containers
58
10
SOURCE: Port of Rotterdam (Port Statistics); McKinsey analysis
187
129
38%
28
Total liquid bulk throughput 2007, Mln tons
49%
Zeebrugge
10
28
Antw Hamb Adam Le H
16
Bre
Dnk
34
5
0
Wilh
Z.bru
Gent
Historically, Rotterdam has benefited from strong global

trade growth, driven by underlying global trade flow drivers
Global trade growth, 87-08, mln tonnes
ESTIMATES
Catch-up effect in 90s and 00s
(opening of E. Europe/China)
Long-term drivers of trade growth, 1980-2008
9,000
Factor as multiple of global GDP
Impact on global trade
Growth in
global consumption/
production
8,000
7,000
6,000
5,000
0.7 - 0.8
Sectors with high transport intensity

(agriculture, construction) grow slower
than GDP
Service industries grow faster than GDP
4,000
3,000
Productivity
gains
0
1987
0.1 - 0.2
Physical output outpaces real value

added
Substantial global labor cost differentials

remain
Real transport cost at historical lows
2008
Rotterdam total volumes, 00-07, mln tonnes
Labor cost
arbitrage
420
400
0.30.5 - 0.7
0.5
~0.2
380
Increasing
specialization
360
0.5- 0.7 0.7 0.9
340
~0.2
320
Total multiple
(trade on GDP)
0
2000
01
02
03
04
SOURCE: McKinsey global trade flows
05
06
1.7 - 2.1
0.3- 2.00.5 2.6
Economies of scale drive consolidation in

manufacturing
Multi-national manufacturers operate
trade-intensive net-works and technology
clusters become global factories
Long-term trade to GDP growth expected

at around 2
Catch up effect of 90s/00s fading
2007
Key global trends likely to drive cargo volume growth towards 2040
Tick mark explanation
Increase of global business resulting in more global

trade
Emergence of different trade patterns driven by
shifting economical powers and new rising
economies (e.g., Africa)
Increased
globalization
Decreased
globalization
Rise of alternative energy will result in low energy

cost, both due to abundance of energy as low
environmental taxes as renewables impose less
burden on the environment
Rise of cheap Continued

new energy
dependence
on expensive
fossil fuels
Depletion of easy to quarry raw materials could result Depletion and Little recycling
possible
is shift to harder to quarry raw materials in the rest of increased
depletion
recycling
the world accompanied by changing trade flows
Possible rise of new commodities due to increased
recycling with likely shifting trade patterns
Description of drivers
Globalization
Low cost
energy
Depletion /
Recycling
New (liquid)
commodities
Rise of alternative liquid fuels driven by renewable

energy revolution (e.g., biofuels, H2, other types of
energy carrying liquids, LNG)
SOURCE: Expert interviews; workshops; McKinsey analysis
Plenty new
commodities
Continued
dependence
on current
liquids
Global scenario1
Ec
on
o
Megatrends1:
m
ic
D
gr
el
ow
ta
fa
th
ct
G
or
lo
ba
co
ls
st
s
up
G
pl
lo
y
ba
ch
liz
ai
at
ns
io
Lo
n
w
co
R
st
ec
en
yc
er
lin
gy
N
g
ew
/d
ep
co
le
m
t
m
od ion
iti
es
Future scenarios are formulated as combinations of these key drivers
~5%
Medium
growth
~3%
Low
growth
Negative
Growth
CAGR, %
Impact on global trade volumes
High
growth
Positive
~1%
High economical growth, while global trade volume

outgrows GDP growth driven by increased
globalization, specialization of supply chains, and
cheap alternative energy
Gap between OECD and emerging countries
becomes significantly smaller (e.g. factor costs, GDP
per capita and consumption)
Moderate global economic growth due to climate
taxes and expensive energy cost
Continuation of gap between emerging countries and
OECD
Majority of production remains in Asia as difference in
factor cost continues to exist
Low economic growth due to expensive energy and
multiple international conflicts which has lead to deglobalization (regionalization)
High transport costs and international conflicts and
crisis lead to emergence of regional trade areas
along continental split (i.e. EU, Asia, North Africa)
1 See appendix for detailed description of scenarios and megatrends

SOURCE: Expert interviews; team analysis
CPB WLO scenarios are used to quantify these scenarios
CPB WLO scenarios
Story behind CPB WLO scenario
Global Economy
Transatlantic
Market
Regional
Communities
Link to scenarios in this report
Little governmental intervention in the

European Union
Liberalization of global trade
EU expands with Turkey, Ukraine
and other small countries
Increased labor mobility
Similar to High Growth scenario

Globalized open economy
High global economic growth
Low environmental burden on economy
EU member states focus primarily on

national interests
EU redirects its attention to the US
Global free trade agreements fail
Increased flexibility of the labor
market
Similar to Moderate growth scenario

Current level of globalization remains
Medium economic growth
Difference in factor cost remain
between OECD and developing
countries
Little modernization of welfare states

World fragmented in couple of Tradeblocks
Welfare split in old EU members
and new EU members
No free global trade
Similar to Low growth scenario

Regional trade areas
Low economic growth
Environmental policies potentially
harming growth of economy
SOURCE: Welvaart en Leefomgeving: scenario descriptions
CPB scenarios estimate overall growth between -0.5% and 2.5% p.a.
Mln ton
CAGR,
2005-40, %
Total volume Dutch ports (including container)

1,200
Global
Economy
2.5
800
Transatlantic
Market
1.4
600
Strong Europe
400
Regional
Communities
1,000
-0.5
Total volume is
expected to grow at
maximum 2-3%, and is
even expected to shrink
in RC scenario
Primary driver behind

this growth are
container volumes
200
0
Total container volume Dutch ports

600
Global
Economy
500
400
Strong Europe
300
200
100
0
1984
5.2
2005
2020
Transatlantic
Market
3.3
Regional
Communities
1.3
2040
SOURCE: CPB, Aanpassing WLO scenarios voor containervervoer, McKinsey analysis
Overall throughput growth is primarily driven by container segment

Scenario summary description
Volume 2040, mln tonnes
Global scenario
A
High Growth
B
Medium Growth
C
Low Growth
CPB scenario
High economical growth, while global trade

volume outgrows GDP growth driven by
increased globalization, specialization of supply
chains, and cheap alternative energy
Gap between OECD and emerging countries
becomes significantly smaller (e.g. factor costs,
GDP per capita and consumption)
Moderate global economic growth due to
climate taxes and expensive energy cost

Continuation of gap between emerging
countries and OECD
Majority of production remains in Asia as
difference in factor cost continues to exist
Low economic growth due to expensive energy
and multiple international conflicts which has

lead to de-globalization (regionalization)
High transport costs and international conflicts
and crisis lead to emergence of regional trade
areas along continental split (i.e. EU, Asia,
North Africa)
Container
542
Size vs 07
5.9
Bulk
426
1.5
Total
968
2.6
Container
287
3.1
Bulk
362
1.3
Total
649
1.8
Container
144
1.6
Bulk
191
0.7
Total
335
0.9
The high growth CPB scenario would require a combination of very

positive developments to materialize
Mln ton
The high growth CBP scenario
implies one has to believe that
542
287
Consumption per capita of containerized

goods in Western Europe increases by
a factor 6x, and/or
the ~10% containers with nonWestern Europe final destination grows

by a 2 digit factor, and/or
global supply chains specialize

further to such an extent that goods are
shipped back-and-forward multiple
times more than today
144
92
2005
Implied
containers
per capita
0.2
Low
Growth
0.3
Medium High
Growth Growth
0.5
~90% of Rotterdam container

throughput has a WesternEuropean final destination
Especially the moderate and high growth scenarios could

create serious congestion problems
ILLUSTRATIVE
No bottleneck
Bottleneck
Terminal
transshipment
capacity
Dry Bulk
Terminal
space /
storage
capacity
Liquid Bulk
Detailed
further
Hinterland
connections
Explanation
Storage capacity likely to be sufficient

Hinterland connections mainly by rail
and barge, no major bottleneck
expected
Little room for expansion of current

storage capacity on terminals
Sufficient spare capacity for pipelines
to hinterland
Container
Terminal storage space reached its

limits early 2007, but 2nd Maasvlakte
likely to provide sufficient storage
Hinterland connections (especially
road) currently congested, likely to
become worse
CONTAINER HINTERLAND CONGESTION
Different actions can help to accommodate container volume growth

ROUGH ESTIMATES
+ Additional capacity
Examples of actions
1x
Transport more
containers by rail
or barge
Dedicated
freight corridor
to North of NL
Intermodal
hubbing in
Hinterland
Expansion of
hinterland road
network
Expand requirements set for

certain modal split for all newbuild capacity on 2nd
Maasvlakte to rest of port
Set-up a barge corridor to

divert all cargo currently
trucked to the north
Construct Inland hubs and

divert all transfer containers to
this hub
Enlargement of RingRotterdam from 2-3 lanes to

4-5 lanes and A15 & A59 from
2 lanes to 4 lanes
Build 2nd Noord-oever
connection
Prepare roads with possible
capacity increase
Expansion of rail
network
capacity
2x
3x
4x
5x
6x
7x
+~0.5
+~0.3
+ ~1
+ ~1
Build 2nd Betuweroute to

accommodate growth
Build an new dedicated railroute to Antwerp
+ ~1
Low Growth
SOURCE: Team analysis
from measure
Volume growth factor of Port of Rotterdam
Medium Growth
High Growth
Rotterdam has the most containerized transfer traffic in the Hamburg Le Havre range
Destinations of hinterland container flows of port outside national territory, percent of total
Other
France
Belgium
The Netherlands
30
Rotterdam
22
Antwerp
Zeebrugge
15
10
13
9
Bremen
21
2
7
13
62
52
5 50
18
Hamburg
Le Havre
17
16
Germany
60% of Rotterdam
inland container traffic
has destination
outside of The
Netherlands
German and French

ports have less than
20% of total inland
container traffic for
foreign destinations
11
SOURCE: Notteboom, Economic Analysis of the European Port System (2009); McKinsey analysis
Containers with destination outside The Netherlands make up for at

least 1/3 of containerized road traffic from the Port of Rotterdam
Roughly 40% of total inbound containers in
Rotterdam is for the Netherlands
Containerized cargo by road, rail and barge
while ~60% of the container

throughput is done by truck
Modal split container throughput, 2007
100%
100%
Germany
Belgium
Barge
31
Rail
10
France
19
Other
Can
potentially
be diverted
to other
modes
Truck
The Netherlands
~40
Assuming all Dutch

containers are
trucked implies 1/3 of
containers currently
trucked could be
diverted by rail or
barge to decrease
congestion
This would reduce

total annual truck
movements in
Rotterdam with
500.000 - 1.000.000
40
SOURCE: Notteboom, Economic Analysis of the European Port System (2009); Port of Rotterdam; McKinsey Analysis
Dutch waterways could potentially accommodate up to 7x current

volumes, but climate change adaption policies could reduce this potential
The Dutch waterways can

cope with a 100% increase in
growth, while the Rhine can
even accommodate seven times
the capacity that it currently
processes
Bureau Voorlichting
Binnenvaart
Extreme dry summers and wet
winters due to climate change
could reduce the capacity of the
rivers
Interview with DG Water
SOURCE: Bureau voorlichting binnenvaart, Waardevol transport 2007 ; Interview DG Water
Container growth is likely to generate more road

congestion, if the current modal split would prevail
Port of Rotterdam
Total throughput 2007, Mln tons
% of total (2006)
Capacity left
Container - Modal split throughput

Number of moves
802
5,637
5,090
5,859
1,354 Barge
4,391
486
515
Headroom left
per modality2
Rail
23
2-7 times3
3-5 times4
45
0 times5
24
n/a
407
2,619 Road
Other cargo
302
287
Containers
105
2007
1,400
20401
Containers makes up for ~25% of

throughput in tons
2003
04
05
Feeder
Throughput
2006
Majority of throughput to hinterland still

by road
No major modal shift has happened for
hinterland transport in the past years
1 Medium Growth scenario

2 Given the port terminals can handle these volumes per modality
3 Capacity of the Dutch waterways according to Bureau Voorlichting Binnenvaart
4 Rough estimates based on current usage of Betuwe-route vs theoretical capacity
5 Currently capacity constrained in rush-hours
SOURCE: Port of Rotterdam (Port Statistics); Bureau Voorlichting Binnenvaart; McKinsey analysis
LIQUID BULK STORAGE CAPACITY CONSTRAINTS
Different actions could help to accommodate bulk volume growth
INDICATIVE
ESTIMATES
+ Additional capacity
Examples of actions
from measure
Volume growth factor of Port of Rotterdam

0x
1x
2x
3x
Capacity increase 2nd Maasvlakte

Reduce
strategic
reserves
Stop storing
ores and coal
in port
Relocate
storage to
Amsterdam
Re-allocate strategic oil reserves

outside the port to free-up space
to accommodate bio-fuels
Re-allocate storage of ores and

coals for the non-Dutch market
outside of the port
Relocate liquid bulk storage to

port of Amsterdam
Expand port capacity to

accommodate volume growth,
e.g., by constructing a 3rd
Maasvlakte or dedicated storage
capacity in the Dutch Hinterland
Increase capacity of pipelines to
accommodate new liquids
growth and store these liquids
outside of the port area
Increase port
capacity
Increase
pipeline
capacity
+0.1
+0.1
+0.1
+ 0.3-0.5
?
Low Growth
shrink
SOURCE: Team analysis
Medium
Growth
High
Growth
LIQUID BULK STORAGE CAPACITY CONSTRAINTS
Besides on the 1st and 2nd Maasvlakte, Rotterdam has little

spare terminal space available
General cargo
Liquid Bulk
Dry Bulk
Food
Distribution
Other Activities
Strategic oil reserves in the Port of

Rotterdam occupy an estimated
5% of total liquid bulk storage
capacity in the port
SOURCE: Port of Rotterdam; COVA; McKinsey Analysis
Contents

Appendix - Beantwoording Offerte vragen
Antwoord op specifieke vragen zoals gesteld in de offerte (1/3)

Vragen
Antwoord
Onderbouwing
in rapport
Rol mainports in Economische

structuur van 2040
Welke rol kunnen de mainports

spelen in de vernieuwing en
versterking van de economische
structuur?
De mainports kunnen een sterke rol spelen voor de direct aan de

mainports gerelateerde sectoren en daaraan gerelateerde
economische structuur. Voor vernieuwing van de economische
structuur lijkt de aanwezigheid van de mainports niet bepalend te
zijn. Andere factoren lijken een grotere rol van betekenis te
spelen voor vestigingsklimaat van buitenlandse bedrijven en de
groei van nieuwe sectoren. De mainports helpen wel met het
versterken van de economische structuur.
H1
Kunnen de mainports door hun

faciliterende rol voor zowel de
kenniseconomie, de zakelijke
dienstverlening en de hoogwaardige
industrie en logistiek bijdragen aan
robuuste(re) economische structuur?
Samen kunnen de mainports de kenniseconomie beperkt

versterken doordat theorie opgedaan aan universiteiten en
andere innovatie-instituten, gecombineerd kan worden met
praktijk van de aan de mainports gerelateerde bedrijvigheid
H1
Welke rol speelt het feit dat de

economie steeds meer een
netwerkeconomie wordt voor de
betekenis van de mainports?
Het feit dat samenleving steeds meer socially networked wordt

zal waarschijnlijk een impuls gegeven aan het mondiale
vliegverkeer en zal waarschijnlijk een extra groei driver zijn
voor Schiphol
H3

Vragen
Antwoord
Onderbouwing
in rapport
Sectoren met belangen in de

mainports in 2040
Welke sectoren of activiteiten

hebben baat bij sterke mainports?
Direct ver bonden aan de mainports verbonden sectoren, zoals

het petrochemisch cluster, hebben baat bij sterke mainports. Van
de niet rechtstreeks aan Mainports verbonden sectoren hebben
de volgende activiteiten wel baat bij sterke mainports:
(Europese) hoofdkantoren, Europese distributie, Training centra,
productie en assemblage en Shared Service Centra
H1
Is toerisme bijvoorbeeld een

potentile groeisector en kan
toerisme een groeisector zijn zonder
mainports? Hetzelfde geldt
bijvoorbeeld voor milieu (CO2opslag, windenergie, bio-energie)
als groeisector
Toerisme is een potentile groeisector, maar is niet afhankelijk

van sterke mainports.
Milieu als groeisector kan heel groot zijn voor Rotterdam door
verwachte groei in o.a. biobrandstoffen en waterstof. Vooral
daar de energetische waarde van deze brandstoffen lager is dan
van conventionele brandstoffen, waardoor meer verwerking- en
opslagcapaciteit vereist is in de haven
H1
Hoe zit het met nieuwe activiteiten

zoals design, entertainment, gameindustrie, mode, .. Welke rol spelen
zij in 2040 in onze economie en hoe
passen de mainports daarin?
Schiphol zal een faciliterende rol spelen voor nieuwe kennis

sectoren zoals de creatieve sector en de game industrie, maar is
niet een sleutel succes factor. Het huidige aantal bestemmingen
en frequentie van Schiphol is voldoende voor deze opkomende
sectoren
H1
Wat zijn de consequenties voor

deze sectoren en activiteiten als we
niet meer zouden investeren in de
mainports?
Voor de verdere ontwikkeling van kennis gedreven en

internationale diensten is het opportuun dat Schiphol minimaal
de huidige intercontinentale bereikbaarheid houdt in 2040
H1

Vragen
Antwoord
Onderbouwing
in rapport
Mogelijke interventies en
consequenties
Wat kunnen de antwoorden op

voorgaande vragen betekenen voor
de ontwikkelingsrichting van het
mainportconcept en de mogelijk
daaraan gekoppelde interventies?
Het belang van een gezamenlijke strategie voor de mainports is

beperkt, gezien het feit dat de samenhang tussen beiden
gelimiteerd is en waarschijnlijk geen belangrijke succesfactor
voor de beide mainports. Er zijn echter wel gebieden van
gezamenlijke belang die een gecordineerde aanpak billijken
De toekomst voor Schiphol is onzekerder dan die van Rotterdam
door grotere complexiteit van de industrie structuur. Gezien de
mogelijke groei tot 7x het huidige volume zullen keuzes gemaakt
moeten worden met betrekking tot wenselijkheid van het
accommoderen van die groei
Indien de verwachte hoge groei in containers materialiseert, zal
dit een grote druk zetten op de achterland verbindingen van
Rotterdam. Naast infrastructuur verbeteringen zal Nederland
beleidsmaatregelen in moeten zetten welke stromen via welke
modaliteit naar het achterland vervoert mogen worden
De mogelijke groei in met name natte bulk zal grotendeel
geaccommodeerd kunnen worden in de Rotterdamse haven.
Allen als de groei zeer hoog uitvalt zal er aanvullende opslag en
verwerkingscapaciteit nodig zijn
H3 & 4

2009 Mainports 2040 McKinsey

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2009 Mainports 2040 McKinsey

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Mainports 2040

Input for exploration phase long-term vision Mainports

Final report, June 2009

McKinsey & Company | 1

Chapter 1: Role of the mainports in the economy

McKinsey & Company | 3

Chapter 2: Interdependence between the mainports

Direct economic interdependence between Schiphol and Port of Rotterdam is limited

McKinsey & Company | 4

Chapter 3: Strategic choices for Schiphol (1/3)

McKinsey & Company | 5

Chapter 3: Strategic choices for Schiphol (2/3)

McKinsey & Company | 6

Chapter 3: Strategic choices for Schiphol (3/3)

Define optimal actions per scenario, depending on the ambition level:

McKinsey & Company | 7

Chapter 4: Strategic choices for Port of Rotterdam (1/2)

McKinsey & Company | 8

Chapter 4: Strategic choices for Port of Rotterdam (2/2)

McKinsey & Company | 9

Role of the Mainports for the economy

McKinsey & Company | 10

Both mainports are of similar relevance to the Dutch economy

Direct - other sectors1

Transport & communication

Estimate of value add Port of Rotterdam

Handing and storage

Direct value add

Public and private services

Total direct value add including business location

Total incl indirect effect

GDP contribution total

McKinsey & Company | 11

Many businesses interact with the mainports, but close proximity

which interact with the

SOURCE: Rankings from World Bank Doing Business; McKinsey analysis

for which access to

McKinsey & Company | 12

The mainports play a role in attracting business functions

Elements of investment climate

Importance of element for business activity

McKinsey & Company | 13

The Netherlands have not attracted many Asian businesses

Non-HQ significant facilities1 of 1802 Asian companies with internationalization potential3

1 All the facilities excluding HQ, sales and branch offices

McKinsey & Company | 14

For Asian companies transport and accessibility is less

Key location factors for Asian companies

CEO Awareness of the country

SOURCE: Swiss-American Chamber of Commerce

McKinsey & Company | 15

The top 3 factors for location decision are access to market,

Cushman & Wakefield - European

Ministry of Economics Affairs Quickscan 2006

Perception of EHQ location factors

Essential factors for locating a

Key location factors

Quality & availability

Top 3 elements of investment climate:

McKinsey & Company | 16

Six industry clusters have been identified as key future growth

McKinsey & Company | 17

SECTORS - CREATIVE INDUSTRIES

Creative business services is the fastest growing segments