Budapest Blooms

Budapest’s bud SkyCourt is the centerpiece of the airport’s recent development. (All images BUD)

The introduction of new facilities during Budapest’s spring has raised its international profile.  Tom Allett reports.

Budapest’s bud SkyCourt is the centerpiece of the airport’s recent development. (All images BUD)

Those who keep an eye on Budapest Airport will have seen many changes in recent years: a new terminal; new owners/operators, new airport name and now, a new chapter in its history.

Last year Budapest handled almost 8.2 million passengers and its management team believes that the airport is well on track to becoming the most successful airport in Central and Eastern Europe in terms of passenger growth, service quality and operational efficiency.
Located within two hours’ flying time of almost all major European destinations, Budapest now serves 97 destinations through 33 airlines.  It offers a strong European route network as well as flights to the Middle East (enabling excellent connections to Asia), together with New York and Beijing – both non-stop flights.  Since the beginning of the year new airlines are committing to Budapest and flag carrier Malev, part of the OneWorld alliance, is also enhancing its schedule and adding new routes.
 
Variety
Budapest Airport caters for both traditional and low-cost airlines.  Terminal 1 (T1) is dedicated exclusively to low-cost carriers (with a 30-minute train transfer to downtown Budapest) while Terminals 2a & 2b are devoted entirely to the traditional carriers.  Not surprisingly, it’s the full-service facilities that have recently benefited from significantly increased capacity, with the opening of the bud SkyCourt, a brand new, centrally located building linking Terminals 2a and 2b.  It has doubled the commercial area of the terminals and provides a wide range of retail outlets, international brands and greatly improved dining options for travellers.
 
Key Driver

Long haul services to New York with American Airlines and Doha with Qatar Airways – and their respective onward connections – have greatly increased Budapest’s route network.

With regard to its expanding route network, the airport says that a key driver in this area has been: “its innovative marketing and airline support” offered by its dedicated team whose “continual focus ensures airlines have the best service from the airport.”
“We are going through the greatest change in our history,” says Jost Lammers, Budapest Airport’s CEO.  “Carriers operating at the airport have been attracted by the expanded marketing incentives and opportunities which have resulted in increased frequency, more airlines, and a higher number of destinations
now accessible from the airport.
“Year on year figures demonstrate the strengthened airline activity with average passenger growth in the low cost sector of 11.9% and in the scheduled sector from non-based airlines of 4.3%.”
The first quarter of 2011 has seen passenger figures increase by an average of 7.5%, a very strong performance when compared with the average European passenger growth of 4.6%.
 
Route Development
Mr Lammers says that continued optimism is fuelled by rising consumer confidence and improved connections onward connections via New York (American Airlines) and the Middle East (Qatar Airways).  Budapest has announced eight new routes in the last 12 month period (May 2010-2011), including KLM’s three times a day service to Amsterdam, plus new routes to Antalya (Wizz Air), Barcelona (Malev), Bern (Sky Work Airlines), Doha (Qatar Airways), Edinburgh (Jet2.com), Istanbul (Wizz Air) and New York (American Airlines).  AirBaltic were due to start flying Budapest-Riga as this edition went to press and summer charter services to Hamilton, Canada, with Air Italy Polska will start in June.  Qatar Airways, which experienced a positive start on Doha last year has already announced plans to make the route daily and direct instead of the four times per week hop via Bucharest, from September.
The airport’s aviation team, led by Director for Aviation Mr Kam Jandu, says that it operates an active route development policy: “mirroring the requirements of their aviation clients”.  What it describes as “attractive incentive schemes for both traditional and low-cost carriers in Terminal 1” include landing charge discounts for short, long haul and seasonal flights in the first few years of operation while current and future fees can be worked out online using the airport’s Charge Calculator.  This interactive facility – located in the B2B section of its website – www.bud.hu – enables businesses to plan their operational costs by giving them details of landing, noise, parking and passenger handling fees.  It also explains the incentives provided for higher frequency and new destination business.
While operators have their own forecasting methodology, the airport’s aviation team says that its analysis is: “acclaimed by its operators” and that its (the team’s) marketing support “assists airlines by implementing a range of targeted and value-for-money strategies.”
The marketing team explains that, from the outset, they continually analyse passenger habits and travel routines to glean information for airline business development.  Passenger surveys are undertaken all year round on a quarterly basis, with a sample of 50,000 passengers providing representative data for every route.  Amongst the areas covered by the team’s research are passenger demographics, purpose of journey, ticket purchasing habits, booking processes and travelling patterns.  Market research statistics are shared through an online databank where airlines can download the results of their routes.  All statistics are available on the website, monthly, via personalised log in codes.
Terminal 1 caters for the low-cost market while Terminals 2a&b accommodate the full-service carriers.

Despite its successes in the passenger market, the airport’s latest major development project is an air freight hub called Cargo City.  At the time of writing – May 2011 – the final design and planning permission stage is almost complete.
As a first step, a 538,195 sq ft (5,000m2) international exchange was completed for the Hungarian Post service last October.  The next stage is to build two further cargo facilities cargo areas, covering 118,403 sq ft (11,000m2) and 53,819 sq ft (5,000m2) respectively.  Located within the southeastern part of the airport, construction work is due to start this September.
The airport operator has already leased out 80% of the cargo centre’s floor space through agreements with two major ground handling companies; Celebi Ground Handling and Malev.
Looking ahead, the airport’s Property Director, René Droese said:  “Developments will not stop when the Cargo City’s first phase is complete as the preparations for the second phase are in full blast.  The project has received very positive feedback from the market, which is clearly indicated by the quick commitment of our two big business partners.
“Cargo City offers a lot of advantages for the local community by creating new job and business opportunities, while boosting the economy of the entire Southern Budapest region around the airport.”
The Cargo City will replace existing facilities located near T1 and, says the airport, will have a: “positive impact at several levels, bringing both operational and environmental benefits for air cargo operators,” whose trucks will have direct access to the local motorway network without going through the suburbs of Budapest.  The first phase of the project is should be completed by the autumn of 2012, but in terms of cargo volumes, when the final stage is completed it is estimated that the cargo capacity will reach 2.5 million tons per year, about 30 times greater than the current level.
 
Budapest Development
• Qatar Airways going direct and daily
• SkyCourt opened in March
• American Airlines starting NY service
• New Cargo City being developed
 
SkyCourt – pledging extra capacity

A KEY value proposition in marketing Budapest Airport in 2010 centred around the provision of additional capacity as a result of its bud SkyCourt – a brand new, centrally located building, linking terminals 2a and 2b (home of the traditional carriers).  The bud SkyCourt, (pictured here during the opening ceremony in March) represented an €88 million (US$126m) investment and entered service on time and on budget.  For operators considering Budapest, SkyCourt boosts capacity of Terminal 2 – from approximately 5 million to 8.5 million passengers per yeat and enables more transfer opportunities, important for the likes of Malev which needs to make connections with its OneWorld partners.