Wizz Air Abu Dhabi is betting on the swift recovery of tourism in Lebanon as it expands its network with a new route to Beirut, following a ceasefire deal that ended more than a year of conflict between Israel and Hezbollah.
The ultra-low cost airline will start flights from Abu Dhabi to the Lebanese capital three times a week starting on June 4, it said on Tuesday. Its entry into the market "is a sign of Lebanon normalising and focusing back again on VFR [visiting friends and relatives] traffic, but also building tourism back in the region. This is a sign of how consumers are reacting and how demand for Lebanese routes is increasing", Johan Eidhagen, managing director of Wizz Air Abu Dhabi, told The National.
Tourism to Lebanon will recover "relatively fast" with the Middle East as a tourism destination growing "massively", he added.
Tourism is a major pillar of Lebanon's crisis-hit economy. The country's real gross domestic product contracted by 7.1 per cent last year because of the war, “a significant setback compared to a no-conflict growth estimated at 0.9 per cent”, a recent World Bank report said. The country's GDP has declined nearly 40 per cent since 2019, with the war further compounding the economic crisis.
Reconstruction and recovery will cost about $11 billion, with $3 billion to $5 billion needed to be publicly financed, including $1 billion for the country's infrastructure alone. Private financing is required for about $6 billion to $8 billion of the costs, mostly in the housing, commerce, industry and tourism sectors, the World Bank said earlier this month.
Mr Eidhagen said the timing was right for Wizz Air Abu Dhabi to start Beirut flights amid "increased normalisation in the region" after a ceasefire deal led to a pause in the Israel-Gaza war and the fall of the Assad regime in Syria. "We felt this was the right time to come in, plus at the same time, we had the ability to add capacity into the market," Mr Eidhagen said. The market debut is a "sign of us believing that the market will return to normalisation quickly and also that we can help fuel this".
Wizz Air will use its Airbus A321 narrow-body aircraft with 230 seats on the Beirut flights. They are high-density aircraft that require more passengers to fill, and have been chosen because "we can see that there's demand and the need for capacity in the market", he said. One-way tickets from Abu Dhabi to Beirut start at Dh359, which, the airline says, is 40 per cent cheaper than current flight prices on that route, with the aim of encouraging passengers to take more frequent trips.
"We are adding a new passenger profile to the mix, people who haven't been able to travel affordably before, because we can bring in a lower price level than what's currently available on this route, which will allow people to travel more than they were doing before," Mr Eidhagen said. The airline is aiming to attract the large Lebanese diaspora living in the UAE and holidaymakers taking short trips to Beirut, he added.
"I think, we will operate straight from the beginning with relatively high load factors, but Rome wasn't built in a day ... This is an investment in the future, not an investment in the summer. We're trying to build a market for point-to-point, low-cost travel between the UAE and Lebanon," Mr Eidhagen said.
"While there's a lot of traffic between UAE and Beirut, the frequency of travel is still relatively small and we believe that by making the route more affordable, people will be incentivised to travel more often or take more of these shorter trips." Load factor, or a measure of how well an airline fills available seats, on a new route usually starts in "mid to high" 80 per cent before growing to more than 90 per cent.
Wizz Air Abu Dhabi has suspended its Athens route for the summer season to "give room for new routes" such as Beirut and Milan that will start in June, Mr Eidhagen said. Wizz Air Abu Dhabi on Tuesday also announced a new destination to Gabala, Azerbaijan, starting on June 19.
"We have been operating to Baku and adding Gabala is a very strong product ... it's a great destination for those who want to get away from the sun and get into a colder climate. It's unexplored and a fantastic destination," Mr Eidhagen said.
Wizz Air Abu Dhabi, a joint venture between Hungary's Wizz Air Holding and Abu Dhabi state holding company ADQ, has an air operator certificate in the UAE and launched operations in 2021, during the pandemic. The airline's network takes in 34 destinations served by a fleet of 12 Airbus A320 and A321 aircraft.
