A very complicated issue for the low-cost Wizz Air is that fuel hedging was abandoned in the wake of the corona pandemic. Carey said the view at the time was that only the banks and oil companies would win in these deals. It was only announced a few weeks ago that the has resumed price hedging transactions.
The current state of affairs is that, according to the company president, Wizz Air currently only purchases a very small part of its kerosene requirements at secured prices and has to buy the rest at the applicable pump price. This means that the low-cost airline is currently paying significantly more than, for example, its competitors Ryanair or Wizz Air. However, Carey believes that this is not so wild, since in about six months those airlines that are currently benefiting from secured prices will also be paying higher prices have to refuel.
The manager of the low-cost airline therefore predicts that prices will rise throughout the aviation industry. At Wizz Air, the average ticket price is currently between 65 and 70 euros and thus between five and ten percent above the level that was in summer 2019. There is a large gap between the price increases that have already been implemented and the sharp rise in fuel prices, which could presumably close further within 12 months.
However, Robert Carey also emphasized that the amount he quoted is not the "basic price" - i.e. only a flight with a small piece of hand luggage, without extras - but "all-in", i.e. what the passengers would actually pay including optional additional services . In stark contrast to this is the fact that Wizz Air has been throwing new discount offers onto the market almost every day for many months. There's a simple explanation, though, which the company doesn't like to talk about.
It was not the 9,99 euro tickets that became more expensive, but the "extras" such as suitcases
The basic prices have not changed at all in almost the entire route network. These famous 9,99 euro tickets are still available and depending on the route, sometimes more often, sometimes almost never. The costs for additional services such as seat reservations, priority package (required for carrying hand luggage trolleys) and checked baggage have been increased. Depending on how much competition there is on the respective route, it can sometimes be extremely juicy. Wizz Air also practices dynamic pricing for additional services, so that no clear statement can be made that, for example, a seat somewhere in the middle of the plane costs around ten euros. That can be the case, but it can also be that 30 euros are required for the reservation.
A concrete example: According to the Wizz-Air homepage, a sample query made on July 6, 2022 for a one-way flight on July 17, 2022 from Vienna to Chania (Crete) in the basic fare (only a small piece of hand luggage included) 29,99, 20 euros required. Taking along a 55 kg piece of luggage would cost 27 euros. For the priority package, which is necessary if you want to take a trolley with you as hand luggage, you have to pay 18 euros. The cheapest seat reservation displayed at the time of the query cost XNUMX euros. It should also be noted that check-in at the counter is subject to a charge of at least ten euros (if booked in advance). If you show up at the counter without prior web check-in, it will be considerably more expensive.
Passengers without trolleys and/or hand luggage are rare on holiday routes
It can be said that with Wizz Air it is not uncommon for the piece of luggage to fly more expensively than the passenger. Since many passengers buy at least the priority package, especially on holiday routes, but often also buy a 20-kilogram piece of luggage, the "average price" mentioned by Carey is rather low. You can only fly cheaply with low-cost airlines like Wizz Air if you are flexible and look meticulously for the cheapest basic ticket and don't buy anything at all. The low-cost airline then doesn't earn a cent net and even pays a lot more, especially for 9,99 euro campaigns, because the airport taxes alone are higher. Since such passengers are the absolute exception, this minority is accepted, because the majority leave a lot of money for suitcases and the like. In the area of additional services, Wizz Air has raised the prices significantly, even if one does not like to admit it and prefers to point out that the bottom line is that on average it has only become "less than ten euros" more expensive. The "barker prices" for the pure flight with a small piece of hand luggage have not been touched, and of course for reasons of competition, because many passengers are tempted by 9,99 euros and that with all the extras that you tick during the booking process, then easily costs 100 euros and more for the one-way, many then no longer notice, because the bargain feeling of 9,99 euros prevails.
Not only at Wizz Air, but also at other airlines, the so-called extra services, which were taken for granted before the advent of "modular systems", were in some cases significantly increased. Across the airlines' "vegetable garden" you will find increases that are sometimes minimal, sometimes juicy. Since most providers use dynamic pricing, it is not possible to make a clear statement about who is asking you to pay particularly heavily.
All airlines and especially low-cost airlines earn their money with high load factors and the sale of as many additional services as possible, which drive up the yield. Wizz Air President Robert Carey makes no secret of this. "High load factors are the key to success," says the manager. Then there is the intense competition, which has by no means weakened despite or maybe because of Corona. Wizz is convinced that passengers will choose the cheapest provider, especially in times like these. And it is precisely in this context that the company sees itself well positioned against competitors such as Ryanair and Easyjet and emphasizes that it still has the lowest production costs.
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