The chief executive of low-cost carrier Wizz Air has cautioned that European competitors could face financial collapse by September if jet fuel prices, driven up by the Middle East conflict, continue to soar. Jozsef Varadi foresees a tough period once the peak summer travel season subsides.
Varadi pointed out that airlines typically struggle twice a year, specifically in September and February, with those having weak cash reserves particularly vulnerable. The cost of jet fuel has surged over 100% since the outbreak of hostilities in Iran.
In a related development, Ascend Airways, a UK-based aircraft lessor serving various airlines, reportedly went into liquidation due to the Middle East crisis and escalating fuel expenses. The situation has led Lufthansa, among other carriers, to cancel thousands of summer flights.
Moreover, the Airports Council International has raised concerns about smaller regional airports facing an “existential threat” from the ongoing industry challenges. Olivier Jankovec of ACI Europe emphasized the severe impact of high jet fuel prices and potential supply chain disruptions on regional airports.
Despite the industry turmoil, Wizz Air remains optimistic about its expanded summer flight schedule, with a focus on growth in specific markets. Varadi expressed confidence in the company’s bookings and downplayed immediate concerns about fuel shortages.
Varadi also called for a reevaluation of Europe’s heavy reliance on Middle Eastern fuel sources, urging the industry to consider diversification to mitigate risks of future disruptions. He highlighted the need for a strategic shift in sourcing jet fuel to reduce vulnerability to geopolitical events.
