Wizz Air Ukraine announced (18-Sep-2013) plans to open its third base on 30-Apr-2013 in Lviv, with one new based A320 aircraft, the fifth in the Ukraine. In addition to the existing routes to Venice Treviso, Dortmund and Milan Bergamo, Wizz Air Ukraine announced five new routes to Barcelona Girona, Naples, Kutaisi, Rome, and Valencia. The new aircraft will support a total of eight routes and increase seat capacity to over 300,000 seats in 2014. Seats on the five new routes are already on sale. Wizz Air Ukraine general director Akos Bus said, "It is a great joy for us to announce our third Ukrainian base in Lviv. Consumers in Lviv and the region already know Wizz Air Ukraine’s low-cost services, as we have operated number of routes from Lviv International Airport since 2010. Now even more Ukrainians can access direct regular flights to new European destinations and tourists from Western Europe can explore another beautiful Ukrainian city. By basing our aircraft in Lviv and opening new routes, we support job creation in the region. Our commitment to Ukraine is clear – we deliver reliable air traffic operations with low fares". [more - original PR]
Wizz Air Ukraine announces third base in Lviv
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European airlines: 1H2016 results show a widening gap between the haves and have-nots
The last of Europe's leading listed airline groups reported 1H2016 results on 19-Sep-2016. This now allows analysis of the aggregate trends for the 15 largest European airline groups listed on the stock market that publicly report financial results for the first six months of the calendar year. These groups account for 53% of ASKs flown to/from/within Europe by all airlines and 71% of ASKs flown by European airlines (week of 19-Sep-2016, source: OAG).
Collectively, these 15 groups enjoyed an improvement in operating margin in 1H2016 versus 1H2015. This was achieved in spite of heavy downward pressure on unit revenue – thanks largely to lower fuel prices, which allowed them to cut unit costs more rapidly. However, there was a wider range of levels of profitability in the individual results compared with last year.
Moreover, in margin terms, there was a trend towards the strong getting stronger and the weak getting weaker. Further, there has been a number of profit warnings in the sector – particularly since the UK's Brexit referendum. This may mean that further improvements in the aggregate results of Europe's listed airline sector will be harder to achieve in 2017.
LOT Polish Airlines: now restructured, and long haul focus is on 2020 growth. Partnerships critical
On 8-Sep-2016 LOT Polish Airlines announced its "2020 profitable growth strategy". This involves a goal to achieve "sustainable viability", after a restructuring programme which returned LOT to operating profit in 2014 after six loss-making years. Its privatisation may even be back on the agenda.
LOT currently ranks behind LCCs Ryanair and Wizz Air by share of traffic in Poland, which offers superior traffic growth potential versus Europe as a whole. The airline aims to increase passenger numbers from 4.3 million in 2015 to 10 million in 2020, growing its fleet from 43 to 70 aircraft. LOT's expansion will focus on long haul, particularly North America and Asia, where it currently has only five routes and where competition is considerably lower than on short/medium haul. Initial plans include the launch of Warsaw-Seoul this winter and a return to Warsaw-New York Newark next summer.
According to data from LOT, its restructuring has left it with a fairly efficient cost base by legacy airline standards and this will be important in competing with LCCs (but there is still a cost gap with LCCs). LOT's growth will focus on long haul but will need short-haul European feed – and partnerships. Although LOT no longer appears to be considering leaving the Star Alliance, it remains excluded from American and Asian JVs. Further, those JVs preclude members from working with LOT. Partnership growth will be as critical as it will be challenging.