Abu Dhabi: Wizz Air Abu Dhabi is setting ambitious goals for 2024, eyeing a 30 per cent growth with a target of nearly 4 million passengers by year-end, said Wizz Air CEO József Váradi. And buoyed by the current growth trajectory, Váradi expects passenger numbers to hit 50 million by the end of the decade potentially. These projections build on the subsidiary’s 2023 performance, where it doubled capacity and passenger numbers, reaching close to 3 million.
On the flip side however, the global aviation scene has gotten off to a rocky start in 2024. Incidents involving Japan Airlines’ Airbus A350 and Alaskan Airlines’ Boeing 737-9 MAX9s have stirred concerns about aircraft safety and resilience.
And the Hungarian carrier is navigating diverse obstacles - from geopolitical tensions to supply chain disruptions. Wizz Air has cut its annual profit forecast as the low-cost carrier is hit by an ‘unprecedented operational challenge’ and geopolitical uncertainty.
About 40-50 of its aircraft will be grounded for Pratt & Whitney (P&W) GTF engine inspections on its A320neo family fleet, Váradi told Gulf News. P&W’s GTF engine issue, stemming from a rare condition in powder metal, has led numerous global airlines, including Wizz Air, to ground Airbus A320 fleets and conduct engine inspections.
Moreover, the extended flight cancellations to Israel until March, tied to the ongoing conflict with Gaza, and disruptions in European operations due to the Russia-Ukraine war continue to persist. Despite this, Váradi hopes to soar above the challenges, especially in the success of the carrier’s Abu Dhabi subsidiary (a joint venture between Abu Dhabi’s ADQ and Wizz Air).
In an interview with Gulf News, Váradi discusses profits, mitigating supply chain challenges, expansion and recruitment plans, and a broader airline industry transition to non-carbon-based travel.
What is your forecast for passenger numbers for Wizz Air Abu Dhabi this year?
So here in Abu Dhabi, we had a big year in 2023. We more than doubled the airline’s size in terms of capacity and passenger numbers, reaching close to 3 million passengers. We are happy with that achievement. We continue to grow coming into 2024 and are looking at another 30 per cent growth at least, where we will be close to 4 million passengers by the end of the year, as planned. We are eager to continue showing our commitment to Abu Dhabi and grow the business here. But we need challenges arising from geopolitics to supply chain issues. Some of our engines are subject to inspections, and as a result, we will have to ground 40-50 of our aircraft (this year), which is 20-25 per cent of our fleet.
Wizz Air’s Polish operations hit a milestone of 100 million passengers last year. How far is Abu Dhabi from such a feat?
We should be close to 50 million by the end of the decade. And if you want to go to 100 million, it would take another three years. It took us 19 years to hit those numbers in Poland.
Grounding 40-50 airlines would result in a substantial blow to your operations. How do you plan on mitigating these challenges? Are you confident you will receive your pending aircraft deliveries on time?
We are increasing the capacity by extending existing leases and taking new aircraft deliveries. Even if we suffer some delays, we are programmatically scheduled to receive these aircraft. Every year, we have 30 to 40 new aircraft deliveries. So, even if there is a shift, we will get it later. But it is a continuous supply of aircraft in the next six years. (Wizz Air’s total A320 family order book, including the ceo, neo, and already-delivered units, stands at 565 aircraft.)
In November 2023, Wizz Air cut its annual profit forecast after being hit by operational challenges. Have any significant improvements been made since OPEC increased its oil outputs?
We are in a very volatile environment, and fuel is only one issue the industry is dealing with. We are heavily affected by the Pratt and Whitney engine situation and the war in Israel-Gaza. And yes, while one line is improving, some of the other lines are still deteriorating. So, net-net, we are not in a better situation today than in November.
What are your plans for route expansions this year? And when will Wizz Air Abu Dhabi launch flights to India and Pakistan?
We operate 12 aircraft in Abu Dhabi, with plans to deploy 50 by the decade’s end, necessitating the opening of new markets and routes. Our commitment to Abu Dhabi involves continuously expanding our network to meet market demands. Last year in Abu Dhabi, we opened eight new destinations. But in 2024, we would be limited to doing that. Also, while Abu Dhabi supports us well, bilateral relations in this region dictate designations, subject to approval by the destination country, which may pose challenges. In India and Pakistan, I cannot confirm that we will be flying to those countries (any time soon), but we are working on it.
What are your plans for recruitment this year?
Our business is set for substantial growth, and recruiting more people will likely be a major challenge in 2025. In 2024, we’ve held capacity due to engine grounding, but significant growth is expected with the engines back in 2025, along with new aircraft deliveries. Smart recruitment planning is crucial, with the need to prepare for the increased capacity in 2025 starting as early as 2024.
Do you have any new sustainability initiatives in the pipeline? What can be done to boost the availability of SAF?
While we’ve invested in sustainable aviation fuel (SAF) production, the economic challenge remains, with SAF being seven times more expensive than traditional aviation fuel. Addressing this initial cost hurdle requires collaboration among governments, production facilities, airlines, and airports to establish a viable solution during the initial ramp-up period of 3 to 5 years. Looking forward, we’re working with Airbus to define decarbonized propulsion technology using hydrogen, a project that aligns with our commitment to long-term technological development in the aviation industry.
Would passengers have to pay for the high costs incurred by using SAF during this 3-5 years interim period?
The passenger is an economically rational actor in the market. Passengers express strong interest in sustainable flying, but there’s silence when asked if they’re willing to pay for it. But the key to addressing this cost issue lies with all the aviation stakeholders.