Wizz Air Targets U.K. Push With Gatwick Slots Coming Free
Wizz Air Targets Major U.K. Push With Gatwick Slots Coming Free
(Bloomberg) -- Wizz Air Holdings Plc is plotting a major expansion at London Gatwick airport as rival carriers pull back, paving the way for the Hungarian low-cost carrier to emerge from the travel downturn with a bigger presence in the world’s busiest city for passenger traffic.
Wizz, Europe’s third-biggest discounter, is keen to expand its U.K. business beyond a base at Luton, north of London, if it can get hold of the operating slots, Chief Executive Officer Jozsef Varadi said Wednesday in a phone interview. He said he’d like to turn Gatwick, located south of the capital city, into its second British hub.
The coronavirus crisis, while devastating to travel worldwide, is still providing opportunities for the handful of airlines that have the means and boldness to take risks. Wizz, which has signaled it will press its growth plans during the slump, has risen quickly in Eastern Europe but lags far behind Ryanair Holdings Plc and EasyJet Plc in the U.K. and much of western Europe.
An opening has emerged at Gatwick, where Virgin Atlantic Airways Ltd. said this week it will pull out and focus on London Heathrow to help ride out the Covid-19 pandemic. British Airways is reportedly looking to do the same, and with Norwegian Air Shuttle ASA, Gatwick’s No. 3 tenant, retrenching to survive the winter, the once full airport could soon have space for new entrants.
“We’ve been looking at Gatwick for a long time and we absolutely have an ambition to build a base there,” Varadi said.
Varadi said any expansion at Gatwick is contingent on being able to secure ownership of operating slots, as he wants to avoid taking over capacity temporarily only to hand it back later.
“We wouldn’t want to lease slots,” Varadi said. “You don’t make an investment in building up a business and the other guy then changes his mind.”
Doubling in Size?
Budapest-based Wizz currently has only a handful of flights into Gatwick, whereas it bases 10 planes at Luton with a further 25 flying in from locations in mainland Europe. Since Gatwick is a bigger airport with a more developed infrastructure, an operation there could be at least that size, the CEO said.
Gatwick’s higher charges might be an obstacle to expansion for a carrier that boasts Europe’s lowest cost base, though those might come down as other airlines depart.
Varadi said he’s also unsure that British Airways and Virgin Atlantic will actually surrender takeoff and landing positions. Virgin CEO Shai Weiss said Tuesday the intention is to lease out the slots until the market revives and a return to Gatwick becomes viable.
Wizz sought to establish itself as a force at Gatwick last year, when it was a contender for slots from failed Thomas Cook Group Plc. Those were bought by EasyJet, Gatwick’s biggest operator, while positions vacated by Monarch Airlines in 2017 went to British Airways owner IAG SA after Wizz had bid.
Business at Gatwick was booming before the coronavirus crisis crushed demand and prompted groundings of entire airline fleets. The airport, traditionally a leisure hub, had aspired to snag some of Heathrow’s full-service passengers, with French owner Vinci SA seeking to convert an emergency runway for regular use.
Wizz said this week that it will launch five new routes from Luton next month in anticipation of the U.K. lockdown being eased. The services to Greece and Portugal could be operated immediately under current conditions should Wizz have wished, according to Varadi, who said he sees no obstacle to the flights.
Passengers and crew will be required to wear face masks and the latter gloves, with onboard purchases made via contactless card, no magazines on offer, and only a limited food service. Cabins will undergo an antiviral fogging process.
While Wizz said it will enforce physical distancing measures, passengers will most likely be kept apart because of low initial demand and there are no plans to limit occupancy levels or block off middle-row seats, Varadi said.
The CEO reaffirmed that Wizz plans to take delivery of the hundreds of jetliners it has on order from Airbus SE, including 22 in the next 14 months, even as many other carriers shrink their operations. He said there are regular “business-like” discussions with the planemaker.
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