Analysis: Wizz Air rows back from Middle East operations

Wizz Air’s withdrawal from its base and operations in Abu Dhabi, announced on Monday, marks a humiliating retreat for the carrier and chief executive Jozsef Varadi, whose rapid growth strategy has been hamstrung by problems with the Pratt & Whitney-made engines on Wizz’s Airbus fleet.

Varadi claimed during the Covid pandemic that Wizz would emerge to compete with Ryanair, unveiling plans to increase capacity by 20% a year and operate 500 aircraft by 2030. These plans have repeatedly stalled.

The low-cost carrier, based in Hungary but listed in London, built a network across central and eastern Europe from 2003 before expanding into the UK and other markets in western Europe. It launched Wizz Air UK in 2018.

More: Wizz Air to exit Middle East citing ‘operational challenges’

The airline breached Civil Aviation Authority regulations on handling passenger refunds during Covid and ranked joint bottom of a Which? airline customer satisfaction poll this year.

Wizz issued two profit warnings late last year and early this year, and claimed it would return to growth in 2026 following a “support and compensation agreement with Pratt & Whitney”, only for full-year results this June to reveal profits down 40% and costs up 16%.

Varadi pulled the plug on a joint venture with the Abu Dhabi sovereign wealth fund ADQ on Monday, blaming the “hot and harsh environment” in the Middle East for “engine degradation three times faster than in Europe”.

Wizz would instead pivot, he said, to a “strategic realignment on core markets” in central and eastern Europe and “select western European markets, such as Austria, Italy and the UK” from September 1.

Ryanair chief executive Michael O’Leary has ridiculed the idea that Wizz presented a competitive threat, suggesting instead that the carrier would struggle to survive.

In May 2023, O’Leary said: “Many of our competitors seem in retreat. Wizz appears to be growing, but all the growth is in the Middle East, not in Europe.

“The Wizz engines were originally to be grounded for 300 days, and that has moved out to 400-450 days.”

Wizz said passengers with bookings beyond August 31 would be contacted over refunds or alternative travel arrangements.