For Central Eastern Europe
Hungary is a landlocked country without a national airline, and is thus open to many different providers. At Air Cargo Europe in Munich József Kossuth told ITJ editor Andreas Haug how Budapest airport is positioned for shippers.
Mr Kossuth, we’ve run many a report on BUD’s positive development as a freight hub. What’s the secret behind your success?
The main reason is that there are several industries in our region – which doesn’t only encompass Hungary, but also includes seven neighbouring countries – that are very relevant to the air cargo industry. Many car-makers are active here, including Audi, which runs its largest engine plant in Hungary. This naturally brings many of the automobile industry’s suppliers to the region too, and they attract logistics centres to manage the concomitant imports and exports. We’re very pleased with the fact that these trade flows are roughly balanced (52% to 48%).
There are other areas that have an extensive industrial presence. So what is the real cause underlying your achievements?
In the last two to three years we’ve additionally managed to extend our network at every level. In the full-freighter segment Cargolux offers three weekly Hong Kong–Luxembourg flights, Turkish Airlines operates three weekly links to and from Istanbul, and last year Qatar Cargo launched a new service that has already been upped from two to three links a week. So the volumes are available; and the hubs of these major providers, for example, connect Hungarian freight forwarders to the rest of the world. On top of this, airfreight-friendly long-haul options have been introduced by Emirates (Dubai) and Air China (Beijing). LOT Polish Airlines is set to launch six direct Boeing B787 flights a week from Budapest to New York and Chicago in May 2018, creating a direct link between the USA and Hungary after a six-year hiatus. American Airlines will launch a daily service from Philadelphia to Budapest in its 2018 summer schedule.
Can you elaborate on that?
The segment’s major players – DHL, FedEx, TNT and UPS – connect BUD to their West European hubs with daily flights. In these days of online orders all of their volumes are growing, not just in Hungary – which also serves as a sub-hub for Serbia, Romania and other countries.
Is your infrastructure coping?
Good question! In May we inaugurated an express sorting facility. New DHL and TNT warehouses and offices are part of our EUR 160 million development programme. This scheme, called BUD:2020, also includes a cargo city compound. I’m particularly pleased that airfreight forms a core element of our plans for the future. Both for the providers of main-deck and belly-hold capacities we’ve re-invigorated terminal projects that died the death after the collapse of our national carrier Malév in 2012.
What will these facilities offer in detail?
The design for our cargo city is advancing. We expect to commence operations in early 2019. This will raise our annual air cargo capacities from 112,00 t (around 35,000 of which is express services) to about 250,000 t. We’ll then be able to fulfil forwarders’ most requests for more direct links.
What about special services?
We’re active on that front too, of course, for example in the pharmaceuticals sector. The local freight community has started a joint effort to achieve CEIV Pharma certification. We’d be happy to handle just 10% of the 150,000 t of pharmaceuticals that Hungary exports annually. We’ll provide more details on this at a pharmaceuticals conference in September [see also page 30].
The operator of Budapest airport
The operator Budapest Airport is owned by the Caisse de dépôt et placement du Québec (21.23%), Malton Investment (23.33%) and AviAlliance (55.44%). The latter, an airport investor and manager, was founded 20 years ago as Hochtief Airport. It also owns minority shares in other European hubs, such as Hamburg, Athens and Düsseldorf, as well as a 40% stake in San Juan airport (Puerto Rico). This explains the joint trade fair presence of these entities and encourages synergies between them in air cargo activities.