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Wizz Air and Ryanair intensify competition in Lithuanian market

2-May-2011

Wizz Air opened its 14th base in Vilnius, Lithuania, on 16-Apr-2011. Wizz Air’s expansion comes as Ryanair also expands in the Lithuanian market, with six new routes to be launched to/from Vilnius in May-2011. The entry of two of Europe’s largest LCCs has resulted in airBaltic downsizing its presence at Vilnius “due to crowding” in the market. Vilnius remains the second-busiest airport in the Baltic region, behind Riga International Airport.

Wizz Air operates eight routes with 20 weekly departures at Vilnius

Wizz Air has initially deployed one A320 aircraft and opened eight new routes from Vilnius to Cork (Ireland), London-Luton, Doncaster-Sheffield (UK) Eindhoven (The Netherlands), Barcelona (Spain), Rome-Fiumicino, Milan-Bergamo (Italy) and Stockholm Skavsta (Sweden). The carrier will operate 20 weekly departures to/from Vilnius initially.

Wizz Air new routes from Vilnius

The carrier has appointed Baltic Ground Services to provide ground handling at the airport.  The carrier announced its intention to launch a base in Vilnius on 29-Oct-2010.

Ryanair to enter Vilnius market in May-2011 with six routes

When Wizz Air announced its Vilnius expansion plans in Oct-2010, Ryanair only operated at Kaunus. Since then, the carrier has announced its intention to launch services from the Lithuanian capital from 02-May-2011. Ryanair will operate six services from Vilnius to Barcelona, Dublin, London, Milan, Rome and Bremen from May-2011. Wizz Air and Ryanair will compete directly on one route and indirectly on four others.  

Wizz Air's Vilnius expansion

Destination

Wizz Air schedule

Competitors (current schedule unless specified)

Cork

2 times weekly

Aer Lingus to Dublin (four times weekly)

Ryanair to Dublin from 03-May-2011 (three times weekly)

London Luton

2 times weekly

Ryanair to London Stansted (daily)

Doncaster Sheffield

2 times weekly

-

Eindhoven

2 times weekly

Estonian Air to Amsterdam Schiphol (daily)

Barcelona

5 times weekly

Ryanair to Barcelona Girona from 03-May-2011 (twice weekly)

Rome Fiumicino

2 times weekly

Ryanair to Rome Ciampino from 03-May-2011 (three times weekly)

Milan Bergamo

3 times weekly

Ryanair from 02-May-2011 (three times weekly)

Stockholm Skavsta

2 times weekly

Estonian Air to Stockholm Arlanda (six times weekly)

Announcing the launch of Bremen-Vilnius service, Ryanair Sales and Marketing Executive for Katarzyna Gaborec stated the LCC was “”delighted to announce our sixth route to/from Lithuania’s capital city, Vilnius to Bremen from May 2011. Lithuanian consumers/visitors can now beat the recession and escape airBaltic’s high fares by choosing Ryanair’s lowest fares (and our no fuel surcharge guarantee) from Kaunas and Vilnius to existing destinations all over Europe including Germany, Italy and Spain."

Vilnius expects half a million pax over summer

Vilnius Airport, upon the launch of the 2011 summer schedule, stated it expects to attract "around half a million" passengers to Vilnius in summer. During the season, 15 airlines will operate scheduled services to 25 destinations from Vilnius Airport. The greatest news is the arrival of two LCCs, Wizz Air and Ryanair," the airport said. LCCs now have a 23% capacity share of the Vilnius Airport market.

Vilnius International Airport's capacity share by carrier type (25-Apr-2011 to 01-May-2011)

Capacity growth (network and LCCs) on international routes to/from Lithuania:
Apr-2002 to Apr-2011

LCCs first entered commenced international services to/from Lithuania six years ago, with a 319% increase in capacity between Apr-2006 and Apr-2011, based on OAG Facts data.

LCC capacity growth on international routes to/from Lithuania: Apr-2002 to Apr-2011

Estonia expands Vilnius base

Estonian Air has also expanded its summer network to/from Vilnius with increased services to Tallinn, Amsterdam, Stockholm Arlanda and Berlin Tegel from 01-May-2011. The carrier has also launched service to Milan Malpensa in Dec-2010 with services also to Tallinn.

Estonian Air last year stated it planned to expand its base at Vilnius International Airport as it "sees growth possibilities" there. CEO Andrus Aljas described the Lithuanian aviation market as "one of the most rapidly growing aviation markets in the Baltic region", where only 0.53 flights per capita are taken annually, compared with 1.04 in Estonia and 1.94 in Latvia.

"A demand in direct and connecting flights from Vilnius is obvious. People that are going by our planes to Amsterdam continue their trips to Chicago, New York, Boston, Detroit, Atlanta, Minneapolis from there. These are popular destinations." Mr Aljas said. 

Estonian Air, at the end of 2010, also stated it had expanded its market share at Vilnius Airport to 10% in Nov-2010, up from 2.5% in Nov-2009. The carrier handled 7800 passengers on services to/from Vilinus in Nov-2010, an increase of 401.6% year-on-year. For the year to Nov-2010, the carrier handled 46,130 passengers, an increase of 354.2%.  

Based on Innovata data for Apr-2011, Estoniar Air has a 9.4% capacity share at the airport, behind airBaltic (19.4%), Wizz Air (18.4%) and Lufthansa (9.4%).

Vilnius International Airport capacity (seats per week, to/from) by carrier
(25-Apr-2011 to 01-May-2011)

Lufthansa reports record Lithuania traffic in 2010

Lufthansa, in Dec-2010, stated it expected traffic on its routes to/from Lithuania to break new records in 2010. The carrier has reported unprecedented passenger growth on its routes to/from Vilnius and plans to adjust its summer 2011 schedule as a result. The adjustment includes new flight times for services between Vilnius and Frankfurt

“We are pleased to see such a positive development of our business on our Vilnius flights. A very good occupancy and increased capacity will lead us to a passenger record this year. We are confident to transport over 100,000 passengers this year. This confirms our approach to the Lithuanian market and our attractive products and services,” Lufthansa Country Manager Baltic States, Matthias Hinze, said. 

airBaltic downsizes Vilnius operations due to 'crowding'

One consequence of the increased low-cost offering at the airport has been that airBaltic decided to downscale its Vilnius operations.

The carrier suspended four routes from Vilnius to Dublin, London, Rome and Paris for summer commencing 27-Mar-2011 citing increased competition and overcapacity on the routes. The carrier stated the new market entrants, notably Wizz Air and Ryanair, have “created identical products, resulting in overlapping of routes and overcapacity”.

“Coincidentally, both Ryanair and Wizzair have announced new routes in Vilnius that overlap with those served by airBaltic. The world is big enough, and we rather walk away from the crowd, to avoid the other two airlines flying wing-to-wing with each other," airBaltic’s General Manager for Lithuania Tadas Vizgirda said at the end of Feb-2011.

She continued to say that the new Vilnius Airport discount scheme “appears to have backfired, resulting in overcapacity on just a handful of routes rather than broadening the choice of routes, as intended by the scheme”.


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