Nieuws en artikelen
- Delta Air Lines arrives at Budapest Airport 23 May 2006
- Hungarian stock exchange closes above 25,000 point mark 21 April 2006
- Morgan Stanley to employ 400 in Budapest 27 March 2006
- Find out why BAA bought Budapest Airport 7 March 2006
Delta Air Lines arrives at Budapest Airport 23 May 2006
Delta’s new service brings great new competition on Budapest to New York route
BUDAPEST, May 9, 2006 – The first Budapest – New York flight of Delta Air Lines took off at 11:55 from Ferihegy.
"This is a great day for Budapest Airport: a new global airline starts its service on a prestige route.” CEO, Budapest Airport, Chris Woodruff said today. “New York, London, Paris, Frankfurt – the global financial centres of the world are all linked to Hungary via Budapest Airport”
Delta’s new service brings great new competition. “This is good for passengers because competition means more choice and better prices.” – Mr Woodruff added.
78,755 passengers travelled between the USA and Hungary in 2005, 60,353 passengers to Canada, the other direct North American destination from Budapest. Passenger traffic between North America and Hungary rose by 3.1% last year.
US citizens accounted for 4.5% of Budapest’s total traffic.
The number of scheduled airlines operating from Budapest rose to 49 with the new flight of Delta Air Lines. The American airline is the fourth new airline to operate from Budapest this year.
"Our aim is to bring more airlines and more new routes, like Delta and to encourage and support our airlines to start up new services. We play our part by giving you the services you need at a competitive price. That’s why we are cutting our charges. So I look forward to BA’s launching Delta’s second, third and fourth US services once we make success of the New York – Budapest Airport route. We wish Delta good luck” – said Chris Woodruff.
Source - Budapest Airport - www.bud.hu
Hungarian stock exchange closes above 25,000 point mark 21 April 2006
BUX at 25,000 points!
The benchmark index of the Budapest Stock Exchange passed another 5,000-point mark shortly before 3:00 p.m. on Thursday, rising 2.5% during the day. The spectacular rise is coupled with massive trading volume, mostly due to high demand for MOL and OTP stocks.
This is nothing different from global and regional trends, with developed markets setting new records as well as their regional peers. Cheap money is flooding Eastern Europe, global liquidity remains high. Growing optimism has been apparent in the major regional markets: after a 0.5% dip in the morning WIG20 stood 1.3% above yesterday's close in the early afternoon, while Russia's RTS, currently above 1,600 points, broke a new record every day of the week. Prague's PX50 gained 1% today.
Why? The general optimism is generated by the following factors:
- Significant funds are being channelled into the region, including Hungary.
- Previous concerns regarding Hungary's macroeconomic situation have disappeared from the limelight, the significant weakening of the forint over the past weeks has stopped
- Before the first round of the current elections, markets anticipate a more stable political environment will follow when the elections are over, with significant investments being made before this change actually happens.
Source www.potfolio.hu (online financial journal)
Morgan Stanley to employ 400 in Budapest 27 March 2006
Morgan Stanley (MS) will open two offices in Budapest, rather than one as earlier reported, the daily Nepszabadsag said Monday, quoting a Labour Ministry official.
In December, Morgan Stanley said it was planning to open an Eastern European research center in Budapest, employing 25 people. Under the new plans, it will also open a Central and Eastern European business processes service provider center in the Hungarian capital employing about 400 people, the paper said, quoting Laszlo Kordas, state secretary at the Labor Ministry.
Morgan Stanley and the Hungarian government have started talks on potential state subsidies for the investment, the paper said.
Source www.marketwatch.com
Find out why BAA bought Budapest Airport 7 March 2006
Ferihegy is an Airport with Huge Potential
Ferihegy is currently the least competitive airport in the region, but it’s growth potential is huge. That was the explanation Chris Woodruff (46), the new CEO of Budapest Airport Corporation gave to HVG for the purchase price of 465 billion HUF for the 75 year right to operate the airport.
HVG: You were appointed by BAA, the new owners, to oversee the transition of Budapest Airport Corporation, the company operating Ferihegy Airport. What exactly is you task?
Chris Woodruff: My appointment is for 9 months and I have already brought my suc-cessor, Stewart Wingate, the customer service manager from Glasgow Airport, with me in order to ensure a smooth transition after my departure. I’m here to fulfil my company’s vision of making Ferihegy the number one airport in the region. My primary task will be to transform Budapest Airport Corp. from a state-owned company into a private company. The other main task will be the development of commercial activities. We will conclude new contracts with them in order for Ferihegy to provide an international level of service.
HVG: In contrast, you had to start your work at Budapest Airport Corp. with some crisis management. How did you manage to disarm the trade unions, who were threatening to go on strike?
C. W.: Our recipe is simple: we sit down and talk with the unions. We have agreed not to begin formal consultations with employees on any major issues until 1 March.
HVG: But the atmosphere is rather sulphurous because according to the trade unions, 1300 employees will be outsourced shortly and another 500 laid off out of the current headcount of 2300.
C. W.: These calculations don’t add up. If all that was true, there would be only 500 employees left at Ferihegy. We need to operate the airport more effi-ciently and if we want to do that, we will need fewer employees than at present, that’s a fact. But I do not want to go into the numbers specifically.
HVG: What do you consider to be the most irrational thing at Ferihegy? What is it that you would like to change immediately?
C. W.: Let me tell you something that seems irrational, even though it is logi-cal. We are going to reduce prices, aviation charges, that is, in order to increase efficiency and revenues in general.
HVG: How does this relate to you announcement of increasing charges at the three airports in London in order to cover the costs of the investments there?
C. W.: During the first 15 years following the privatisation of Heathrow Air-port, we continuously decreased airport charges. However, 4 years ago we em-barked on a large-scale development that necessitated the raising of the charges. Terminal 5, currently under construction, costs about 4.2 billion pounds, or 1550 billion forints. The regulatory background is also very different in the two coun-tries. In Hungary, a decree has been published, specifically regulating the charges that Budapest Airport is entitled to collect from the airlines each year. This is 12 euros per passenger this year, already a decrease from last year. In addition, the decree prescribes a periodical annual decrease in the charges. However, even this is not enough as far as we are concerned. We would like to reduce the charges at an even faster rate than the decree stipulates. We are also going to boost commercial revenues. This is going to be the company’s main source of profit.
HVG: Last September, Márton Vági, the CEO of ÁPV Rt. said the main rea-son for the privatisation of Budapest Airport was that several hundreds of bil-lions of forints need to be invested into its development. By comparison, you have only undertaken investments of 65 billion forints. Why are you so modest?
C. W.: I have never heard this figure of several hundreds of billions of forints. I think 65 billion is a huge number, it will entail a rate of development unheard of in the history of Ferihegy. At the same time, we mustn’t forget that this is only the minimum level of investments guaranteed to the Hungarian state in the privatisation agreement. So it conceivable, in fact, probable, that we will be in-vesting even more than that.
HVG: You paid an astronomical sum, 465 billion forints, for the right to op-erate the airport. Consequently, you expect Ferihegy to develop immensely. Just how much growth do you expect?
C. W.: We paid an appropriate price for the airport because we are optimistic about the long-term prospects at Ferihegy. We did not sign the contract for short-term gain. This is also evident from the history of BAA; we do not sell our airports. Following on from the 7.5 million passengers last year, we are expect-ing to have about 12 million passengers within 5–6 years. This is also good news for the Hungarian economy. As János Kóka, the Minister of the Economy has said, one million extra passengers will create about 3000 new jobs. After that, we would like to continue to increase the capacity of the airport and pas-senger numbers, so that we will have 25 million passengers a year at Ferihegy by 2020–2025. That would be equivalent to the size of Stansted airport today, which is third amongst London’s airports, behind Heathrow’s 55 million and Gatwick’s 32 million per year. There is intense competition in Central Europe. Vienna is in the lead with 14 million passengers a year. However, its rate of growth was only 7.2 percent in the first ten months of last year. Prague had more than 10 million passengers last year. But even their growth rate of 12.8 percent is behind Budapest’s figure of 27.1 percent.
HVG: What are your ambitious plans on the traffic increase based on? Are you going to attract passengers from nearby airports?
C. W.: The other airports in the region are much more competitive than Feri-hegy, primarily due to their price structures. In order to increase competitive-ness, we have to reduce prices, not only landing charges, but also ground han-dling fees for example.
HVG: Do I understand correctly, you paid a huge sum for the least competi-tive airport in the region?
C. W.: But Ferihegy’s growth potential is larger than that of the others. Buda-pest is progressing a similar path to Prague, except it is about 3 years behind the Czech capital. We have examined the tourism potential in Hungary and we see tremendous opportunities for growth. Hungary recently joined the EU, Budapest is an attractive city, Hungary’s GDP-increase is turning out quite well and there is an increasing demand for travel. Today, if Hungarian citizens want to travel from Budapest to America, Asia or Australia, they have to fly to a hub, change and take another flight to their destination. We have already begun negotiations with the airlines on launching direct flights from Ferihegy to new countries, to distant destinations. So we will seek to attract those passengers who have been forced to fly to various hubs until now. Malév’s accession to the Oneworld alli-ance is also a great opportunity. What makes Ferihegy very attractive is that it has two runways, just like Heathrow, and roughly the same land area. So we purchased what we can make out of this airport.
HVG: Is it true that you are indeed going to purchase the 20 hectare land area in Ecser that caused a scandal before privatisation?
C. W.: Why would we need more land?
HVG: And is it true that you agreed with Hochtief, who also wanted BA, they will not sue in connection with the perceived irregularities in connection with the Budapest privatisation process, whilst BAA, which only has a bridge-head in Naples outside of the UK, will not compete for other Italian airports?
C.W.: That’s not true. Neither BAA, nor Hochtief are tendering for the opera-tion of Milan Airport, which was mentioned in certain Hungarian media reports. The reason is that there is no such tender.
HVG: What is Ferihegy going to look like in 5 years and what is your final goal?
C. W:: Most of the developments concern Terminal 2, where we will join Terminals A and B into one. We will also expand it to make more space for check-in, open more restaurants and shops and expand parking facilities outside the terminal building. A less spectacular development for passengers is building more parking spaces for aircraft.
HVG: What was your calculation, how long would it take to get a return on the purchase price and the investments? When will BA start making a profit for BAA and how much?
C. W.: Good Lord! You are not going to get our rate of profit out of me. But this airport is going to produce a profit for us for sure.
HVG: Then let me ask you this. What portion of the profits will the Hungar-ian state receive in return for its 25 percent stake in BA? According to some re-ports, this will only be 10 percent.
C. W.: We have agreed on the financial construction with the government, the situation is clear for both parties. I do not wish to say any more than that on this topic.
Published in the leading Hungarian economic weekly HVG on the 12th January, 2006.
