ROUTES: Budapest back in balance

Las Vegas
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Budapest airport is on track to handle around 8.5 million passengers this year, as it settles into a more balanced traffic mix after a tumultuous 18 months.

The Hungarian airport lost around a third of its traffic at a stroke when home carrier Malev collapsed at the start of the year. But the rapid response from low-cost carriers to fill the void, notably from Wizz Air and Ryanair, meant passenger numbers in 2012 only dropped by 5% to 8.4 million.

The Irish budget carrier, however, cut back its capacity at Budapest by 40% at the start of this year. "They have right-sized the network," says Budapest airport chief commercial officer Kam Jandu. The Irish carrier now operates three aircraft from Budapest and its route network is more complementary to that of Wizz. The latter carrier itself continues to expand at the airport. It will add base an eighth aircraft at Budapest and represents around a quarter of capacity.

"The fundamental difference [to Malev] is Wizz is predominantly point to point. So the long-haul feed isn't exposed anymore," Jandu says. Budapest lost connecting services, including its long-haul flights which had connected into Malev's network.

While Ryanair has cut its capacity, Jandu explains the airport is roughly on track to handle a similar amount of passengers as last year, helped by network carriers adding more capacity, in part by deploying larger aircraft. "We now have the right balance of business, in terms of the number of destinations," Jandu says.

After Malev's collapse, the airport immediately mothballed its older Terminal 1 facility, moving all traffic into Terminal 2. "We have a traffic forecast which we expect in 2017 to trigger the debate on whether to invest more in Terminal 2 or return Terminal 1," he says. That point comes at 11 million passengers. "If we grow fast, then we'll bring that debate forward," he adds.

Jandu also points to the bright longer-term economic outlook for Hungary and the region, which forecasts GDP growth of 3% from 2015 – higher than the 2% rate in western Europe.