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AIRPORT PROFILES Last modified on May 11, 2011

Terminal Velocity


The opening of a new terminal and Hungary’s EU presidency ensure that 2011 will be a year to remember for Budapest Airport, writes Joe Bates.

Budapest Airport and Hungary will not forget 2011 in a hurry after celebrating a series of milestone events in the first few months of the year.

The gateway marked Hungary’s six month presidency of the EU by opening its new €100 million SkyCourt terminal and officially changing its name to Budapest Ferenc Liszt International Airport in honour of the Hungarian born composer.

The good news does not stop there, however, as in April the gateway started work on a €20 million project to modernise and upgrade its older terminals.

And, Celebi Ground Handling has signed a contract to become the first anchor tenant at the airport’s planned new €30 million Cargo City, agreeing to occupy nearly half of the 26,000sqm development which is due to open in late 2012.

Initially acting as the showpiece ‘link’ building between existing terminals 2A and 2B – where passengers will still check-in – SkyCourt ensures that Budapest Airport is now equipped to handle 11.5 million passengers per annum.

The capacity of the main passenger complex (SkyCourt, T2A and T2B) is 8.5 million while a separate low-cost terminal (Terminal 1) is capable of handling up to 3mppa.

However, the planned future expansion of SkyCourt through the addition of two new piers and an extra 170,000sqm of apron could see the airport’s capacity rise to in excess of 20mppa.

Part funded by the EU, the new 24,000sqm terminal is built across fi ve storeys and boasts an impressive central hall equipped with 39 shops and restaurants and a state-of-the-art baggage handling system in the basement.

Its retail facilities spread across a total area of 4,300sqm and include an impressive 1,400sqm Gebr Heinemann walk-through duty free store. The German company has invested €3.5 million in the complex which is its third largest duty free outlet outside of Germany after Istanbul–Ataturk, Oslo and Copenhagen.

A host of F&B outlets include Hippopotamus, Asian brand Yum Cha, Burger King, Italian concept Negroni and, local restaurant Gundel operated by SSP. Other popular brands include Costa Coffee and KFC.

The layout of the new concessions area was created by UK companies, The Design Solution and Pragma Consulting.

Airport CEO, Jost Lammers, enthuses: “The opening of SkyCourt is a real turning point in the 61 year old history of our airport, a real quantum leap into a new class of civil aviation for Hungary.

“We have made a major step forward in reaching our aim, to turn Budapest Airport, the gateway to Hungary, into the best airport in Central and Eastern Europe both in terms of growth perspectives and service quality. Without SkyCourt we would have never been able to reach this goal.”

Perhaps fittingly, passengers on a Malév Hungarian Airlines fl ight to London’s Gatwick Airport were the first to pass through SkyCourt on Sunday, March 27.

Lammers told Airport World that he expects the new terminal to make a signifi cant impact on customer satisfaction levels at the Budapest gateway.

“It is not an overstatement to say that SkyCourt has transformed Budapest Airport in terms of its operational efficiency, facilities and services that we are able to offer both passengers and airlines.

“The shopping and food and beverage outlets it offers are fantastic and there is simply no comparison between the lounges that we are able to offer premium passengers today and the ones we previously used.

“In recent years, we have always been close to average to just below average in ACI’s Airport Service Quality survey. Passengers rank us better than average for our cleanliness and short walking distances, but have marked us down for a lack of lounges, restaurants and shopping facilities. With nearly 40 new retail and food and beverage outlets in SkyCourt alone, I don’t think that this will be an issue anymore.”

Lammers is also quick to point out the positive impact he believes SkyCourt will have on the airport’s passenger handling capabilities. “The creation of SkyCourt has allowed us to be much more fl exible and efficient in our passenger handling,” explains Lammers.

“Before it was built, T2A and T2B were fully independent and basically one handled Malév Hungarian Airlines traffic and the other the bulk of the rest of traffic. This worked well until Hungary signed up to Schengen. The result was that more than 60% of our passengers were squeezing into one facility while throughput at the other tailed off.

“All passengers now pass through a new bigger and better centralised security screening area before walking airside into SkyCourt and then eventually onto their gates which, if they are for a non-Schengen service, will be beyond an immigration control point in a small dedicated area of Terminal 2B. The system basically means that any airline can check-in in either T2A or T2B.”

SkyCourt was designed by the Ybl prize-winning architect, Zoltán Tima, and a team of engineers from Hungarian architectural design company KÖZTI, while local fi rm KÉSZ spearheaded its construction in just 15 months.

“Together with them, we have carried out the investment and construction under the most diffi cult external circumstances, through the months and years of one of the deepest financial crisis of the post-war era,” comments Lammers.

“And here I would also like to point out the commitment of Budapest Airport’s international shareholders and the Hungarian government, who were supporting and pushing forward the completion of the SkyCourt project even in these most difficult times.”

Martin Gauss, CEO of Hungarian national flag carrier, Malév, is certainly a fan of the new addition to the airport’s facilities.

Gauss, who steps down from his position in May, believes that SkyCourt has transformed the look and feel of Budapest Airport from an old, slightly weary gateway into a facility that is comparable against some of the best passenger terminals in Europe.

He enthuses: “The terminal will make a huge operational difference to Budapest Airport, especially in terms of convenience and connections times for transfer passengers, which make up a large part of our business.

“As well as winning on times, passengers also win in terms of some fabulous new facilities. It is the most modern passenger terminal in Europe and arguably one of the most customer friendly.”

He is not alone in liking SkyCourt, which even before it was completed won the annual Tierney Clark Award for being the best civil engineering project in Hungary.

The award is presented by the Institution of Civil Engineers (UK), the Hungarian Chamber of Engineers, and the Hungarian Association of Consulting Engineers and Architects.

Budapest Airport is operated by a HOCHTIEF AirPort led consortium, which paid BAA €1.9 billion for a 75-year operating lease in June 2007 and has since invested in excess of €215 million on upgrading the gateway.

In addition to SkyCourt, the new owners have installed new IT systems, added 80,000sqm of apron and built a central distribution centre for the Hungarian postal service as part of the five-year expansion plan ‘BUD Future’, which aims to position the airport as a key Eastern European hub.

Operating company, Budapest Airport Zrt, counts HOCHTIEF Concessions (37.25%) – through subsidiary HOCHTIEF AirPort – and the Hungarian government (25%) as its main stakeholders. The remaining stake is held by four financial investors – Caisse de dépôt et placement du Québec (Montréal; GIC Special Investments (Singapore; KfW IPEX-Bank (Frankfurt; and Goldman Sachs Infrastructure Partners (US) courtesy of its holding in Aero Investment sarl.

“Budapest Airport is a shining example of HOCHTIEF Concessions’ strategy of taking a long-term interest in airports as an industrial investor,” says Reiner Schränkler, chairman of the executive board of HOCHTIEF Concessions.

“We expand and modernise the facilities cost efficiently and in line with demand. Together with our operating expertise and active management, we continuously optimise an airport’s efficiency.”

HOCHTIEF Concessions currently has shareholdings in six airports, in Athens, Budapest, Düsseldorf, Hamburg, Sydney and Tirana, which between them handled around 93 million passengers in 2010.

Not surprisingly, Malév the dominant carrier at its Budapest hub where it accounts for around 38% of all passengers passing through Hungary’s capital city gateway.

Amsterdam, London and Paris have traditionally been Malév’s best performing and most profitable routes served from Budapest, although Hungary’s presidency of the EU for the first six months of 2010 has seen passenger traffic soar on its Brussels service.

“I have tried to get Hungary’s EU presidency extended for another six months, but nobody has listened to me,” jokes Gauss.

The airline currently operates more than 70 daily flights to 51 cities in 33 countries across Europe and the Middle East using a fleet of 24 comprising 18 B737NGs and four Bombardier Q400 turboprops.

Its fleet and network ensure that it is essentially a regional airline, with its longest routes being Madrid, Beirut and Damascus.

The airline does, however, codeshare with oneworld partner, American Airlines, on the new daily New York JFK–Budapest service.

Competition for Malév in Budapest is provided most fiercely by low-cost carrier Wizz Air and the Lufthansa Group, with Austrian Airlines (Vienna), Lufthansa (Munich, Frankfurt and Milan) and SWISS (Zurich) all serving the gateway.

Budapest is actually served by nine low-cost carriers that include Wizz Air, Jet2.com, Germanwings, Augsburg and Air Baltic.

In addition to Malév, the biggest airlines serving Budapest today are Wizz Air, which handles more than one million passengers yearly, and Lufthansa, which accommodates around 700,000 passengers.

Budapest Ferenc Liszt International Airport’s route network ensures that it is primarily an O&D gateway, although transfer traffic is on the rise and now accounts for around 20% of the passenger throughout.

In addition to SkyCourt and T2A and T2B – the former having dedicated gates for Schengen traffic – the gateway also boasts a low-cost terminal (Terminal 1) that is currently used by Wizz Air and other low-cost carriers serving the gateway.

A total of 8.2 million passengers (+1.5%) and 83,000 tonnes of cargo (+20%) passed through Budapest Airport last year to put the gateway back on the growth track after a 2009 dip in traffic, attributed to the global financial crisis.

Airport World 2011 - Issue 2

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