There is mounting angst in the European low-cost airline market as Wizz Air continues on a trajectory of remarkable growth. The airline has gone from strength to strength over the past year and partially attributes its success to its Airbus A321.
The A321 provides the formula for success
When it comes to flying low-cost, Wizz Air is a strong contender in the field. At the tail end of last year and the beginning of 2020, it provided an extensive update to its route network. There were expansions in Albania and Italy, Vienna, the UK, and Armenia to name but a few. However, the Wizz Air dynasty is not over yet.
In an earnings call on 29th January 2020, CEO of Wizz Air József Váradi said that whilst the airline is now competing with multiple LCCs it has been able to play to its strengths. Despite the fact that the competition from Ryanair now comes in the form of four airlines and easyJet stands strong, one aircraft has allowed Wizz Air to triumph in revenue and overall growth.
That aircraft is the Airbus A321.
The benefit of the A321 is that it has the seat capacity advantage over other competitors’ aircraft. Wizz Air recognizes that. In the earnings call, Skift reports that Wizz Air’s CEO said the airline has the advantage with its seating capacity on the A321. Wizz Air says that its A321 seat 230 passengers at full capacity. That’s in contrast to Ryanair’s 189 seats on its 737-800 aircraft, which the airline operates exclusively. For the moment…
Will Wizz Air’s success last?
Although the A321 has been part of Wizz Air’s exceptional achievements over the past year, the airline still needs to consider the future of its low-cost contest. The benefit of additional seats cannot last forever, mainly because Ryanair will (hopefully) soon be receiving some of its Boeing 737 MAX order and because the industry evolves.
In a press release from Wizz Air’s Q3 F20 results, József Váradi said:
“We believe that the company is uniquely positioned for long term value creation. We will continue to enhance our market-leading positions with the roll out of the game-changing, attractively priced and financed A321neo aircraft which will enable Wizz Air to continue widening our cost advantage over our competitors, providing passengers with the reassurance that they are making the right choice to fly with Wizz Air as we have the lowest impact on the environment of any airline.”
Wizz Air will need to harness the power of its tailwinds and bring them into the coming year. Whilst the likes of easyJet and Ryanair may not be growing as much as Wizz Air proportionally, they are still flourishing and they have years of loyalty behind them as well.
So what does Wizz Air have up its sleeve?
That said, Wizz Air is prepared for the ensuing competition between itself and other low-cost carriers. The airline will soon be launching its new airline in Abu Dhabi to compete in the lucrative Middle Eastern LCC market. It’s also got the go-ahead for the purchase of 20 A321XLR allowing Wizz to further extend its route capacity. And let’s not forget about those 200+ A321neo and A320neo aircraft it’s still waiting on.
A 23% increase in passenger numbers for 2019 and a €126 million revenue increase in the final three months of 2018 have been figures for Wizz Air to celebrate. Another successful year awaits , however, but it seems as though Wizz Air has a gameplan that will return a healthy profit.
What do you think about Wizz Air’s growth in 2020? Let us know your thoughts in the comments.