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Swissport Cargo Services compelled to cease Hungarian operations

Zurich/Budapest, 30 November 2010 – Swissport International, the world’s leading provider of ground services to the aviation sector, will cease its cargo handling operations in Budapest on 31 of January 2011.  The cessation of operations became inevitable after an extended period of regulatory uncertainty obliterated the business.

When Swissport entered the Budapest air cargo market in 2004, the company seemed to have everything going for it: a successful start-up, highly satisfied customers, a motivated workforce and profitable growth. In a challenging market environment and despite the presence of two long-established competitors, Swissport rapidly won the business of several major flagship carriers and rendered a vital contribution to the competitiveness and attractiveness of Budapest Airport.  

In mid-2009, however, the Directorate of Air Transport of Hungary’s National Transport Authority withdrew Swissport’s regulated-agent status, claiming that a licence was required for the company’s off-airport operation and ordered the cessation of business activities. Swissport challenged the ordinance in court and eventually prevailed, but the extended period of uncertainty forced virtually all Swissport customers to shift their handling business elsewhere.

Swissport’s once flourishing business in Budapest was soon reduced to a commercially unviable niche operation. Despite considerable commercial efforts following Swissport’s vindication in court, a meaningful business could not be rebuilt

Realizing that permanent damage had been inflicted, Swissport reluctantly decided to exit the market in order to curtail its considerable losses. Swissport deeply regrets this difficult but inescapable decision, and will be doing its utmost to ensure a smooth transition for its remaining customers and fair severance arrangements for its personnel.

Despite this involuntary withdrawal from the Hungarian market, Swissport remains fully committed to Eastern Europe and continues to pursue business opportunities in the region.For further information, please contact Peter Kohl, Head of Germany/Austria/Hungary for Swissport Cargo Services (peter.kohl@swissport.com) or Balázs Enyedi, country manager of Hungary for Swissport Cargo Magyarország Kft (balazs.enyedi@swissport.com)

 

Swissport International Ltd. provides ground services for over 70 million passengers and 2.8 million tonnes of cargo a year (the latter using 38 warehouses with a total floor area of 360 000 square metres) on behalf of some 650 client companies. With its workforce of around 33 000 personnel, Swissport is active at 177 airports in 38 countries on five continents, and generated consolidated operating revenue of CHF 1.7 billion (EUR 1.3 billion or USD 1.7 billion) last year. www.swissport.com

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