With an airport revamp, top-notch convention facilities and the world’s largest beer festival, could Munich be Germany’s ultimate MICE destination? Paul Revel reports
Lufthansa’s wide-ranging restructuring programme has been extensively reported – a fairly drastic efficiency-drive designed to boost operating profits to more than €2 billion by 2015. However this hasn’t stopped it investing heavily in one of its key hubs, Munich airport.
The airline has a 40 per cent stake in the airport’s Terminal 2, which is used exclusively by the national carrier and its partners. Lufthansa is sharing a €650 million investment with the airport owner to build a new 125,000sq m T2 satellite, which will have gates for 27 aircraft and increase capacity by 11 million passengers per year (MPPA) – the main terminal having reached its limit of around 25 million MPPA.
At the topping out ceremony last autumn, airport CEO Michael Kerkloh said the satellite, which is scheduled for completion in 2015, is designed with a built-in option for a second-phase expansion that could further increase capacity to 17 million MPPA.
Marianne Sammann is Lufthansa’s director of passenger sales management for southern Germany. She says the airline’s current winter timetable offers flights from Munich to 112 destinations in 44 countries. “Each week about 5,000 Lufthansa flights take off from, or land at, Munich,” she says, adding that this summer will see new routes to Mexico and Toronto.
It seems business travel and meetings, incentives, conferences and exhibitions (Meetings, incentives, conferences and exhibitions) activity are helping drive demand for this added capacity. The Munich Convention Bureau reported some healthy statistics for the first ten months of 2013 – its monthly overnight stay figures averaged a 5.85 per cent year-on-year rise, while arrivals were up an encouraging 4 per cent.
So who is doing business in Munich? Lufthansa’s Sammann says top sectors for the city include finance, hi-tech and automotive. “Munich is also Germany’s number one location for the insurance industry,” she says. “And there are around 22,000 hi-tech companies based in the area.”
She adds: “Munich is Germany’s DAX capital [DAX refers to the 30 largest companies trading on the Frankfurt stock exchange]. It’s the city with the highest number of DAX companies in Germany, of which six are headquartered in the area. And SMEs [small- and medium-sized enterprises] in Munich grow at a rate of 23,000 new registrations a year.”
The Munich Convention Bureau says growing source markets for MICE include China, India, the Asia-Pacific region and the US. The convention bureau offers support services to events planners, including help with the RFP process, coordination, accommodation, and pre- and post-event excursions.
The hotel sector is also noting healthy demand from the corporate sector. Jon West, UK managing director for hotel booking specialist HRS, says his research shows that the city’s leading international fairs, and popular events such as the Oktoberfest beer festival (see panel, right), mean reservations tend to be booked up to one year in advance. “Another trend we’ve noticed is Munich has the most expensive hotel market in Germany, with an average rate of €112 a night in Q3 of 2013,” he says.
“However, it’s also ranked as the best value for hotels in the country,” adding that for overnight stays, Munich is the country’s second most popular destination after Berlin, with 9.7 million overnights during January to September 2013.
LeRoy Sheppard is UK sales director for German hotel chain Maritim, which has 38 properties in the country, and focuses on business travel and Meetings, incentives, conferences and exhibitions. He says: “Due to the strength of the automotive industry in Munich, as well as the city being the HQ of Siemens, both of these segments continue to be very strong source markets. We’ve also noted an increase in the number of pharma events.” He has seen business boosted by investment in both air networks and infrastructure on the ground.
Sheppard and others cite the auto sector as a source of business, offering spectacular events opportunities. Munich is the home of BMW, and BMW World is a stylish events venue for petrol-head delegates, with its eye-catching architecture, factory tours, iconic vehicles from the past, and the latest gleaming models.
Munich has the facilities you’d expect from a key destination, such as a large convention centre and a comprehensive list of luxury and conference hotel brands. And beyond the ‘conventional’, there’s a wealth of modern and historic attractions and venues to tempt event planners. The splendid Residenz Palace complex houses priceless treasures that reflect the power of an 800-year royal dynasty, and the Versailles-style Nymphenburg Palace sits in acres of woodland, parks and ornamental lakes. Bavaria has dozens of fairytale castles, some of which offer stunning corporate event settings.
However, while the region benefits from a strong core business base, infrastructure and international network, how it fares in 2014 and beyond will no doubt be affected by the fledgling ‘grand coalition’ agreed at the end of last year, which sees Chancellor Angela Merkel lead the government in partnership with the opposition Social Democratic party.
BAVARIA BY THE BARREL: The romantic road to Oktoberfest
My memorable Bavarian journey started in the pilot’s seat of an A380, and ended with dancing, singing and hoisting vast steins of beer while a live band belted out pop anthems to a 10,000-strong crowd, resplendent in dirndls and lederhosen.
Our group flew from London, Manchester and Birmingham into Frankfurt airport, where we met retired veteran Lufthansa pilot Heinz Rieckert for a fascinating tour of the airline’s cavernous, purpose-built A380 hangar, and had a chance to get up close and personal with a superjumbo – from its cockpit to its 22 nitrogen filled tyres and the 3 metre-diameter titanium fans in the vast Rolls-Royce engines. Rieckert said 40,000 items are delivered to the plane for every flight, from cutlery and condiments to the red roses for the first class cabin.
Then it was time to hit the Romantic Road, a picturesque route winding south through quintessential Bavaria. The route offers several options for corporate incentives and activities. Highlights include beautifully preserved medieval towns such as Rothenburg (pictured) and Nordlingen – the only one in Germany with a fully-intact city wall, best viewed in a glorious 360º panorama from the top of the 90m-tall tower of St George’s Church.
The church and many other historic buildings are largely built of a rare rock called suevite, formed in the white heat of a massive meteor strike 15 million years ago – the town sits in a shallow crater 25km in diameter, formed by the impact. The town’s crater museum charts this epochal event and its history.
Activities on this route often involve imbibing – good training for the Oktoberfest beer festival at our journey’s end. There’s al fresco wine-tasting among the pretty vineyards at the family-run boutique estates at Bad Mergentheim, and artisan beer-tasting at the Wallerstein Brewery. At the Michelin-starred Mayers Keller restaurant, chef Joachim Kaiser cures his famous hams – said to rival those from Parma – for two years in the restaurant’s vaulted cellars.
Then its time for the famous Oktoberfest. The figures speak for themselves: in 2013, 6.4 million revellers visited the 420,000sq m fairground and consumed 6.7 million litres of beer, as well as 114 whole oxen and 48 calves. We checked into Munich’s 347-room Maritim hotel, which features extensive conference facilities and an indoor rooftop pool with city views – and is a ten-minute stroll from the fairground.
Maritim’s UK sales director LeRoy Sheppard says: “Oktoberfest is a pre-built, corporate event heaven. With its world-renowned reputation it automatically increases the interest of corporate clients looking to attract maximum numbers to an event.”
However, he warns that “booking tables at the fairground is key to the success” of any corporate event. Leading the festivities at Oktoberfest are the massive brewery-sponsored tents, with capacities of around 10,000. Their daily sessions with excellent live bands are very popular, and there are only a limited number of reservable tables in the VIP areas, and events managers need to plan well ahead to reserve these.
Suffice to say, many steins were hoisted, cheesy pop songs bellowed, tables danced on, and alarmingly silly hats donned… The perfect end to a trip that demonstrated the beguiling German ability to approach business and having fun with the same level of dedication.