Wizz Air CEO: No Plans for airBaltic as Fuel and Geopolitics Challenge Rivals
Wizz Air's Perspective on airBaltic and the European Airline Industry
By Tim Hepher
Limited Opportunities from airBaltic's Bankruptcy
COPENHAGEN, Sept 14 (Reuters) - Wizz Air sees few if any opportunities from airBaltic's bankruptcy and expects a wider shakeout of other European airlines that were unable to hedge against high fuel prices, the budget carrier's CEO Jozsef Varadi told Reuters on Monday.
The recent oil price spike "sucks up liquidity very quickly from the industry, and especially those airlines which are unhedged," Varadi said on the sidelines of a conference hosted by the International Society of Transport Aircraft Trading.
"I think they will be in a very difficult situation."
Geopolitical and Market Challenges
Planted at opposite ends of Europe's sprawling aviation market, Wizz and Latvian state-owned airBaltic have both been shaped by Europe's expansion eastwards over two decades followed by the collapse of relations with Russia.
"Now there are no Russians coming, and airBaltic is just far too big for a tiny little market like Latvia," Varadi said.
"Does it create an interest for us? Very limited to be honest ... Latvia is at the periphery of the European Union, then you have the Russian border. So given the current geopolitics how can you execute against that concept?"
Wizz Air's Growth Amidst Industry Turbulence
Varadi co-founded Wizz in 2003 just as Hungary, Latvia and eight other countries were preparing to join the European Union. Moscow's invasion of Ukraine in 2022 dented its network but it has continued to grow at a significant pace.
AirBaltic, meanwhile, set out to become a regional hub airline but was left reeling by the loss of Russian routes and traffic as well as high fuel prices.
Fuel Prices and Industry Outlook
Airlines worldwide are grappling with high oil prices since the start of the Iran war. Wizz is hedged at half the market price across 80% of its needs in the next 12 months, Varadi told the ISTAT conference.
Varadi said this year would be bumpy as the industry tackles oil prices and geopolitics but could create opportunities.
Opportunities in Other European Markets
"We've seen a vacuum in Italy. We were pushing a lot of capacity into Italy and in Romania, Albania and some other places, and I think we will continue to do that," he said.
(Reporting by Tim Hepher; Editing by Tomasz Janowski and Alexander Smith)
