VIENNA (Reuters) - Hungarian low-cost airline Wizz Air (WIZZ.L) announced plans on Tuesday to enter the Austrian market in April, betting on rising demand for flights to eastern Europe after the insolvency of two carriers has left a gap in route networks there.
Wizz Air will invest $331 million and create 120 new jobs to connect Vienna with cities including Gdansk in Poland, Tuzla in Bosnia Herzegovina and Varna in Bulgaria, the UK-registered, Budapest-based carrier said.
“This is the biggest single market announcement we ever made,” Chief Executive Jozsef Varadi said at a news conference in Vienna.
Vienna is one of Europe’s main air traffic hubs for eastern European destinations. The airport (VIEV.VI) saw the number of passengers travelling from Vienna to destinations in eastern Europe increase 11 percent in the first nine months of 2017. Passenger traffic to western Europe was up 4.2 percent in the period.
Wizz Air’s exposure to central and eastern Europe has shielded it from fierce competition on Mediterranean and Western European routes, which contributed to the demise of Germany’s Air Berlin (AB1.DE) and its Austrian subsidiary Niki.
A deal to sell Niki to British International Consolidated Airlines Group (IAG) (ICAG.L) and save its important runway slots hangs in the balance after a German court ruled that Niki would have had to file for insolvency in Austria instead of Germany.
Wizz Air plans to have 3 aircraft based in Vienna and operate a total of 17 new routes from the Austrian capital by the end of the year, Varadi said.
Reporting by Kirsti Knolle; Editing by Shadia Nasralla and Louise Heavens