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British low cost carrier EUJet will start flights to Budapest on March 28, pushing the number of budget airlines serving the Hungarian capital to ten. Observers say the market is approaching saturation point, while Europe’s low-cost giant Ryanair is yet to start service to Budapest.

Budget airlines have become popular in Hungary in the past two years. Their popularity, which produced a total of 1 million low-cost passengers in 2004, however does not hurt the positions of traditional airlines.

“Low-cost carriers are competition to traditional airlines, but their low fares are aimed at a different group of passengers, namely to those who otherwise would opt for other means of transportation,” said Hungary’s flag carrier airline Malév in an e-mailed statement.

Malév’s market assessment is echoed by executives of budget airlines. “We are generating new market segments,” said György Borsos, managing director of SkyEurope Airlines Kft, the Hungarian subsidiary of Bratislava-based SkyEurope Airlines. “ We attract foreigners to Hungary who wouldn’t come otherwise, and we fly Hungarians who never took an airplane.”

Mostly as a result of a number of low-cost airlines starting to serve Hungary, the number of passengers on the London-Budapest route grew to 727,000 in 2004 from 383,000 in 2003. A Budapest-London flight booked for May 2005 costs HUF 3,190 at SkyEurope that flies into Stansted, HUF 2,650 at EasyJet that flies into Gatwick, and HUF 660 at WizzAir that connects the Hungarian capital with Luton.

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