Routes Reconnected: Wizz Air CEO: 13 new bases and 260 new routes since pandemic started
“We made a lot of wrong decisions but we’re happy with it,” József Váradi, Wizz Air’s CEO, told Routes Reconnected live on 2 December.
“Every crisis is a problem but also an opportunity. If you’re afraid of taking decisions, you’re nothing.”
Wizz Air has certainly been extremely bullish in moving ahead and adapting irrespective – or because of – the pandemic. Its rationale was simple. “We’re going to see structural demand changes and we must ensure we grow elsewhere and take advantage of changing dynamics.”
“We kept our eyes on the future and kept investing for the future aided by a clear view of how we want to come out of the pandemic.” And Váradi is clear. “We must come out of the crisis as a stronger airline and better competitive force.”
“We made up our mind quickly [about what to do] and we were prepared to make mistakes.”
Making mistakes doesn’t extend to governments, however. “Governments haven’t done anything good,” Váradi said. “The last eight months have been a miserable failure of government.”
“They should be coordinated and they should focus on real issues. Why put people into quarantine if they haven’t been tested?”, he posed.
Wizz Air: Italy will be key going forward
Wizz Air launched 260 new routes and 13 new bases since coronavirus started. Its new bases include Catania, Doncaster, Dortmund, Larnaca, London Gatwick, Milan Malpensa, Oslo, and Tirana.
And Wizz Air Abu Dhabi, a new AOC, is due to take off in January. This resulted from a relationship with the Abu Dhabi government.
But Wizz Air isn’t going to complicate the business by diversifying. “Geographies will spread, but that’s it.” It’ll all be uniform strategically, operationally, and commercially. All that matters is shareholder value, Váradi said. About its A321LRs, they’ll provide more “penetration opportunities,” but don’t expect long-haul.
“Some decisions have been strategic and others very opportunistic and happened because of the pandemic.” Yet, most base decisions were decided using pre-crisis research.
This includes Italy, which will “absolutely” feature more heavily going forward. Italy has seen a big build-up in the past few months, including domestically. Its greater focus on Italy isn’t surprising, with the country its fourth most profitable based on our recent analysis.
Wizz Air has no strategic markets, but what about Gatwick?
“We don’t have strategic markets – we only think about them in profit terms.” In terms of strategic markets, he referred to very congested and slot-constrained airports.
That said, Gatwick is a new base at which it is fighting for more slots. “Gatwick is a fairly natural choice,” Váradi said. But the carrier needs more slots and is very vocal against slot waivers. “It isn’t a market measure – it has to be stopped right away. If airlines haven’t made money for years despite slots, they won’t now.”
Váradi expects more UK bases. He didn’t suggest where, except where slots aren’t such an issue. anna.aero predicts that Manchester, Cardiff, London Southend, and Edinburgh will become future Wizz Air UK bases.
Looking to the future, Wizz Air needs lower costs now more than ever to really stimulate demand.
“People’s willingness to travel hasn’t changed,” Váradi insisted. However, economic conditions – and the impact on disposable income and therefore demand – have changed.
As such, demand stimulation is even more important than normal, with Váradi expecting lower costs from airports – and other stakeholders – by becoming more efficient and to pass the savings onto it.
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