After announcing new bases, Wizz Air lowers capacity outlook
Wizz Air was one of the few exceptions amidst the current crisis, as the low-cost carrier announced an abundance of new bases throughout Europe. However, reality seemingly hit the airline’s chances to realistically fulfill its capacity outlook, as Wizz Air expects lower growth than previously anticipated.
In an operational notice issued on September 1, 2020, the Hungarian carrier stated that it still expects its Q2 FY2021 capacity to be at around 60% of last year’s levels. Wizz Air finished Q1 FY2021 with capacity down as much as 88.5%, as load factors on board its aircraft were around 55.5%. Nevertheless, the company proceeded to announce new bases all throughout Europe. In total, it launched nine new bases throughout Q2 FY2021, including London Gatwick Airport (LGW) and Milan-Malpensa Airport (MXP) in Italy.
Furthermore, it doubled down on its plans to start Wizz Air Abu Dhabi operations, its Abu Dhabi, United Arab Emirates-based subsidiary. The new venture in the Middle East market will launch on October 1, 2020, and will expand to six aircraft in the first six months of operations.
While financial guidance was marked as “impractical” due to the current pandemic, Wizz Air noted that it was successfully ramping-up its operations and was flying up to 70% of its capacity as of July 2020. The low-cost carrier, however, planned to further ramp-up and fly 80% of seats compared to last year’s capacity levels.
“Notwithstanding recent developments, Wizz Air expects capacity for the second quarter of the financial year at roughly 60%. If, however, mobility restrictions across the network persist, capacity is likely to remain at around 60% in the third quarter of the financial year, as opposed to 80% as previously anticipated,” indicated the company’s operational update.
Wizz Air does not rule out reducing capacity further, as the possibility of parking parts of it fleet throughout the winter to protect its liquidity remains real. Meanwhile, the airline has been on a quest to minimize its costs, despite the unprecedented expansion – it significantly cut its pilots’ base salary and capped bonus payments.
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