DUBAI, United Arab Emirates (AP) — Low-cost carrier Wizz Air said on Monday that it plans to suspend all locally based flight operations out of Abu Dhabi as geopolitics and operational developments test its margins.

Zayed International Airport, in the Emirati capital, has long been overshadowed by its successful Dubai neighbor, the world's busiest for international travel.

Wizz Air's decision to end operations out of its hub in Abu Dhabi, effective Sept. 1, comes as it aims to focus on its core markets in Central and Eastern Europe, the Hungarian company said in a post on X. The announcement follows last month’s 12-day war between Israel and Iran, which shook the region and sent airlines scrambling amid airspace closures.

In a statement, Wizz Air CEO József Váradi said the company has had “a tremendous journey in the Middle East.” But, he added, “the operating environment has changed significantly.”

“Supply chain constraints, geopolitical instability, and limited market access have made it increasingly difficult to sustain our original ambitions,” Váradi said.

Wizz Air’s Abu Dhabi subsidiary, created in partnership with the government-owned Abu Dhabi Developmental Holding Co., was its first operation established outside of Europe.

Abu Dhabi’s airport authority didn’t respond to a request for comment. Zayed Airport has been far outshone by Dubai International Airport. Last year, 92.3 million passengers traveled through Dubai, compared to 28.8 million for Zayed.

Wizz Air’s profits already had been falling before it decided to exit its Abu Dhabi operations and before an unprecedented Iranian strike on a U.S. military base in neighboring Qatar that shocked travelers in the region. The Arab Gulf states have long been viewed as a safe haven from the violence and instability in the broader Middle East.

Last fiscal year, Wizz Air reported a 41.5% year-on-year nosedive in net profits – from 365.9 million euros ($427.8 million) to 213.9 million euros ($250 million) – though revenue increased by 3.8% to 5.3 billion euros ($6.2 billion).

Wizz Air said the move would free up resources that would be redeployed to “regions with greater long-term potential for sustainable growth and profitability.” The airline's departure comes as the federation of seven sheikhdoms looks to encourage tourism and for other ways to diversify its economy beyond reliance on hydrocarbons.

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