Value creation

Economic benefits

Munich Airport has regional economic impact at a number of different levels. A basic distinction is made between the effects resulting directly from airport operations on the one hand and the effects of its use on the other.

Value-added effects resulting from airport operation

The value-added effects generated by airport operation can be categorized into direct, indirect, and induced effects. In 2012, all of the companies that were based on the airport campus generated direct added value of 2.48 billion euros. Every hundredth euro generated in Bavaria is generated by Munich Airport.

Effects resulting from use of air traffic

Effects resulting from the use of Munich Airport are known as location effects. These include positive economic effects, such as an increase in productivity and investments, plus a high level of employment and innovation. Proximity to the airport is seen as an important criterion for companies deciding to settle in the area, particularly those operating on an international scale. The airport also offers impressive advantages for the tourism industry.

How much wealth the airport creates

Effects Brief description
Direct effects All value created by Munich Airport’s economic activities. The direct value created is used to pay salaries and wages.
Indirect effects The sum of all effects within the area under review which are generated by preliminary services supplied from this area to companies at Munich Airport.
Induced effects Economic activities with a value-added effect in the area under review which are generated by purchases made using income at Munich Airport.
 

Location effects

1) IHK study 2015

Central procurement of services 2)

Group-wide product group management

Munich Airport does not have a conventional supply chain, and instead procures the wide range of products and services needed to operate an international hub airport. The range of essential products is comparable to the requirements of a small town: The 139 product groups range from office supplies and road construction to vehicles and buildings. In 2016, the total volume of orders placed by the Munich Airport Group amounted to around 740 million euros. All procurement by specialist areas and subsidiaries is handled by the central Group-wide product group management system at the Procurement department. The only exceptions are the merchandise, food & beverage, and medical equipment product groups, where purchases are made directly by the eurotrade, Allresto, and MediCare subsidiaries.

Legal provisions in respect of procurement

The Munich Airport Group, a sectoral contracting entity, operates in the field of «Ports and Airports». As a result of this, the Procurement department’s work is based primarily around antitrust law in the field of procurement, particularly with respect to exceeding certain thresholds. Where public contracts are involved – including construction and supplier contracts or services offered by commercial entities or professional freelancers – the calls for tenders are issued on an Europe-wide basis in keeping with the binding regulations under procurement law. Orders that are not subject to public procurement legislation are normally put out to tender based on a formal, Group-wide process.

Supplier structure

Around 4,600 suppliers work for the Munich Airport Group. The supplier structure during 2016 was relatively consistent with the previous year. Of the companies supplying Munich Airport, 92 percent are headquartered in Germany. Of these, 52 percent are from Bavaria and 32 percent are from Munich and the area surrounding the airport.

Supplier management

In 2016, Flughafen München GmbH assessed around 150 of its framework agreement partners according to the following criteria: the quality of the product or service, reliability of delivery, and service and price trends, as well as the company’s certification according to quality and environmental standards. In the event of poor outcomes, the suppliers had the opportunity to eliminate existing deficiencies in supplier audits.

The product group structure at Flughafen München GmbH

  • Office and other overheads
  • Raw materials
  • IT
  • Marketing
  • General services
  • Maintenance/repairs
  • Vehicles, machinery, and equipment
  • Semi-finished products, tools
  • Electrical, automation, and process control technology
  • Energy
  • Construction and planning

Sustainability aspects

A party submitting a tender must confirm it complies with statutory provisions in order to rule out anything that would prevent it taking part in public procurement or tendering procedures. Those submitting tenders must also provide evidence that they comply with the standards relating to quality assurance and environmental management. For example, energy consumption and environmental impact must be taken into account when purchasing road vehicles. The top priority when commissioning products or services is to draw up agreements that satisfy environmental, social, and economic requirements. (Legal basis: Section 21, of the SektVO (Sector Ordinance) Section 7 of the SektVO (Sector Ordinance))

The Munich Airport Group awards contracts on the basis of cost-effectiveness and places particular emphasis on the utilization of materials and products that are both durable and use low levels of natural resources. Where necessary, any subsequent costs for servicing and maintenance (life cycle costs) are also taken into account. The centralized nature of procurement helps to avoid any duplicate orders and results in savings due to economies of scale.

The Group is mainly supplied by business partners in the region, which helps reduce transportation distances and CO2 emissions. For example, Allresto purchases food worth almost 20 million euros each year – nearly all of which originates from Bavaria, and a good 50 percent of which comes from the area directly around the airport.

2) The figures relate to the total volume of orders placed by the Munich Airport Group in 2016.