Wizz Air: Where now
for its bold plan? — October 2022
At the beginning of the pandemic we observed that Wizz Air had a bold plan: it would pursue growth aggressively, build its A321neo fleet rapidly and enter new markets where the incumbents were weak. It looked as if this could be a successful, that Wizz Air would emerge as a triumphant disruptor (see Aviation Strategy, May 2020), But when it published its Q1 results FY2023 (April-June 2022), the picture had changed for the worse.
Wizz Air was directly exposed to the repercussions from Putin’s invasion of Ukraine. Demand in central and Eastern Europe (CEE) Europe, Wizz Air’s home market, fell sharply, pushing RASK down by about 10% compared to pre-pandemic operations. In 2021 Wizz Air management made a decision to go to a policy of no hedging on fuel and currency, because it had lost out on its previous hedging positions. This proved disastrous when fuel prices surged and the euro weakened against the dollar. CASK rose about 40% compared to pre-pandemic.……