Hungarian Wizz Air to increase ticket prices

The Hungarian low-cost airline always highlights that they are Europe’s fastest-growing company in the sector. Of course, the epidemic affected them, but the Hungarian government tried to help them out. Thus, they received a lot of transport assignments, during which they carried healthcare equipment and vaccines to Hungary. However, it seems that their Q4 numbers from 2021 will be so bad that increasing the ticket prices seems inevitable. 

According to reuters.com, Wizz Air’s fourth-quarter loss will be more than in Q3 when it reached 213.6 million euros ($241.2 million). That is because of the Omicron variant, which affected their sales significantly in the second half of 2021. Furthermore, it will have an impact until March, causing travel uncertainties. Of course, other airlines suffer from the same factors. They had been on a rollercoaster ride in the last two years because the governments regularly changed travel rules in their efforts to contain the spread of the virus.

CEO József Váradi told the news website that Wizz Air “cut costs and acquired new landing slots”. Therefore, they are waiting for the recovery in a better position than their main competitors, Ryanair and EasyJet. They expect to exceed the 2019 capacity levels by 50 pc in August-September.

“We are expecting a very strong recovery path of demand in the next few months,”

he said.

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However, he also highlighted that costs are increasing. That means fuel, the increasing wages, and the financial demand of regulatory changes. As a result, he said that fare prices would go up in the short term. He added that he expects “overcapacity in the next three to six months as rivals return to the market.”

Mr Váradi said that all airlines would have to juggle with higher input costs while offering competitive fare prices. That will be the most important challenge of 2022. 

He also said that, thanks to the recent decision of the British government, they experienced a significant rise in demand.

Iho.hu reported that Wizz Air has a 10-year-plan, during which it would like to expand its fleet to 500 aircraft and employ 4,600 pilots. To do so, they need new pilots, and that is why they inaugurated their new, full-flight simulator in Budapest. It enables the company to train 1,700 pilots per year.

Reuters reported that despite the losses, Wizz Air had liquidity of 1.4 billion euros at the end of December, making it one of the leaders in the market. Iho.hu says that one of the main factors contributing to the losses is that Wizz Air expanded its fleet and employee numbers even during the epidemic. That is because its CEO believes that recovery will be quick. Thus, they can conquer the market then.

Source: Reuters, IHO