Wizz Air adds competition for Aegean Airlines in Greece

The Greek economy has lost more than a quarter of its value over the past decade, most of this in the first five years. Yet aviation, that most economically sensitive of sectors, has enjoyed a kind of gravity-defying growth. After initially only suffering a 10% fall in air passenger numbers over the first five years, traffic has grown by 57% since 2012. Greece has remained attractive to inbound tourism, which has driven the growth.

Aegean Airlines Group is the only significant home grown operator, but the Greek market has attracted strong competition from foreign airlines, in particular from LCCs. Ryanair and easyJet are the next two biggest operators in Greece. Wizz Air, previously only very small in Greece and absent from Athens, has launched seven new routes from the capital in Mar-2018, and this will rise to nine by May-2018.

Aegean has maintained healthy profitability in recent years in spite of the challenges posed by Greece's weak economy and strong LCC competition. Its capacity growth paused last year, to the benefit of unit revenue, but it will be mindful of the consequent loss of market share. Aegean's recent A320neo family order indicates its confidence for the future. Greece's return to economic growth in 2017 provides optimism that traffic growth should continue to be healthy.