Jun. 13—HUNGARIAN airline Wizz Air is in talks over an aggressive expansion at Gatwick, Luton and other UK airports — just as its rivals face a struggle to survive.
Group chief executive Jozsef Varadi said he was holding discussions to fly more planes from the UK, where he sees potential for 'long-term growth'. He is also planning to launch flights to India through Wizz Air's new Abu Dhabi airline.
Varadi said the FTSE 250-listed firm was able to expand while other airlines were 'very distressed' because it had low costs and an efficient business model. Wizz Air shares have risen by 50 per cent over the past year, to £47.86.
Varadi said many of his rivals were 'stuck' and 'locked down', burning through cash to survive.
He told The Mail on Sunday: 'The industry has never been more challenged — but it's a double-edged sword. You can look at life from the perspective of the problem or from the perspective of the opportunity.
'The real question is whether you have the resources available to take advantage of the situation. Most airlines may not, because essentially they are consuming resources for day-to-day survival. We have been preparing for that, and we wanted to make sure we had the resources available to us to move strategically should that happen.'
Wizz Air has more than 240 Airbus planes on order, costing about $100million (£70million) each, to expand the fleet by 60 aircraft to 200 in the next two to three years, and to 300 within five to six years.
Varadi said: 'Adding 160 aircraft incrementally over the next five to six years is $16billion of investment we are bringing to the party.'
The extra capacity will be split between Wizz Air's three airlines based in the UK, Hungary and Abu Dhabi. Varadi plans to add between 200 and 300 new routes in three years to the current total of more than 800. He said: 'We tap into new markets, we are joining the dots, and we keep stimulating traffic on new routes.' In the UK he said Wizz Air was in talks with a number of other undisclosed airports about opening new airport bases, adding to Gatwick, Luton and Doncaster. It will open a base in Cardiff in July.
Varadi said he planned to snap up takeoff and landing slots at Gatwick once the Government reinstates pre-pandemic rules that mean airlines must forfeit slots unless they are used 80 per cent of each flying season. 'We could see ourselves operating a fleet of 20 aircraft at Gatwick in a very short space of time,' he said. He is also in talks to secure licences for new routes from Abu Dhabi, where Wizz Air launched a new airline jointly with Abu Dhabi state operator ADQ in January.
Future destinations could include India, Pakistan, Sri Lanka, Bangladesh and Nepal. Varadi said: 'The subcontinent is a large market for the United Arab Emirates and we are working on getting access to those markets. Once permitted, we will make an announcement.'
Wizz Air, founded in Budapest in 2003, is planning further expansion across central and Eastern Europe — its 'bread and butter' market — plus the Middle East, Russia and other former Soviet states. It has added 18 airport bases and more than 250 routes since March last year.
Wizz Air's cash burn is currently less than €50million (£43million) a month, after the airline settled fuel hedges that had affected its costs.
It made a loss of €576million in the year to March 31, 2021, against a profit of nearly €300million a year earlier. But Varadi said it would not need to raise further financing, with €1.6billion cash at the end of March, and called its €500million bond 'an insurance policy'.
He expects to fly 80 per cent of the network this summer, depending on when restrictions are lifted.
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