Wizz Air Abu Dhabi ready to play waiting game on India, Pakistan flights: József Váradi

DUBAI: The war in Ukraine, fluctuating fuel prices and supply chain problems in Europe are indeed causing trouble for Wizz Air’s job – but the budget airline’s chief executive is confident of a big profit this financial year. József Váradi said the airline would be able to recover a net profit of 350 million to 450 million euros from a net loss of 535.1 million euros in the previous year.

during an interview gulf news, Váradi talks profits and the wider aviation industry’s transition to carbon-free travel. He also spoke about the launch of flights to India and Pakistan and the possibility of a new subsidiary airline.

Compared with the previous net loss, we expect a net profit of 350 million to 450 million euros. This is around EUR 1 billion in profitability compared to the same period last year. Some of that will be direct revenue, some through improved underlying cost performance, and some from a more favorable environment in terms of fuel and foreign exchange.

When you look at the decline in performance in the last fiscal year, most of it is because of poor performance in the first half of the year. That’s when the war in Ukraine broke out, resulting in a major network reorganization. As a result, we had to divert aircraft and personnel. This severely impacted our ability to generate revenue. Second, as we headed into the height of summer, the entire European supply chain system collapsed.

We’ve put a lot of effort and investment into making sure we’re more resilient when issues like this arise, and we’ve seen results in the second half of last fiscal year. We expect this performance to continue.

It’s all about improving productivity and internal operations, increasing capacity on profitable routes, and optimizing non-productive routes. Today, Wizz Air is one of the best performing airlines in Europe with the fewest capacity cancellations.

Divided into three stages. One is currently, we are taking whatever technology is available and using it to its full potential. Wizz Air does a great job at this.

Most of our fleet is refreshed with an average age of 4-5 years. Fleet renewal and expansion brings the benefits of new technologies in terms of ownership and operating costs, fuel consumption, and low carbon and noise emissions. As a result, our carbon footprint is the lowest in the industry.

The second stage is the bridging stage, or SAF. This is another way to reduce your carbon footprint. But two important factors—availability and cost—play a huge role here.

This requires investment, and the cost needs to come down to make it more affordable. For now, SAFs are going to be more expensive to produce, at least in the early stages. Maybe we could look at a funding mechanism that would bring different stakeholders into play, like the government, maybe the EU, etc.

The third phase, which I think is critical, is the transition from carbon-based propulsion to non-carbon-based propulsion, which I think will be hydrogen.

This requires a wait-and-see approach. OPEC has been adjusting production rates fairly steadily. We have hedged to a large extent, 60% of our fuel requirements have been hedged for the financial year and will continue to do so. Therefore, we should not see much volatility, at least in the short term.

It all depends on the approval of Indian and Pakistani authorities. This is something we are still working on. It’s impossible to set a timetable for that – it could take three months or three years. We must wait.

We are seeing a lot of demand for Wizz Air Abu Dhabi. We are already expanding our fleet from 9 to 16 aircraft over the next 12 months. Our recruitment program is also in progress.

By the end of the decade, this market could have 50 aircraft.

If we see the current situation, there will be delays on the manufacturing side. But we are buying aircraft as planned for the respective fiscal years.

this is possible. Currently we already have four airlines – Hungary, UK, Abu Dhabi and Malta. So subsidiaries are part of our operating model. We’re very excited about the wider Middle East region, including the Gulf and Central Asia.

We are seeing significant expansion of Wizz Air in the region and consumer demand is high. These areas offer good prospects for a future AOC (Air Operator Certificate).

The Neo is the best narrowbody available. It gives you the best economic and environmental performance of any other aircraft in this category. We will continue to operate these aircraft, which is our best platform. There are currently no diversification plans.