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Wizz Air to open base at London Luton in drive for growth

A Wizz Air Airbus 321 aircraft lands at the Chopin International Airport in Warsaw, Poland May 17, 2016. REUTERS/Kacper Pempel

LONDON/BERLIN (Reuters) - Budget airline Wizz Air (WIZZ.L) will open a new British base at London Luton, seeking to drive growth in routes between Britain and eastern Europe and improve efficiency, it said on Thursday.

The east Europe-focussed airline said the base will open on June 18 with one new Airbus A320 aircraft. Luton will be its first UK airport with base operations, and the number of routes it serves from the airport will rise to 42.

Although London-listed Wizz has been flying from Britain since 2004, until now it had not set up a British base. CEO Jozsef Varadi said the decision to do so reflected the size of the Luton operation, where it served 5 million passengers last year, making it the second largest airline there behind easyJet.

"For the scale and size of the business, the operating model is not efficient or sustainable. If we want to grow, we need to base some capacity there," Varadi told Reuters, adding that space at Luton was getting tight and Wizz wanted to book an overnight stand before rivals did.

Basing planes at Luton will give the airline more flexibility and allow it to open more routes, he added.

The three new routes announced on Thursday will connect London Luton with Tel Aviv, Kosovo and Georgia.

Varadi said the decision had nothing to do with Britain's decision to leave the European Union.

He said Wizz was happy with its Hungarian operating certificate for now and was not currently looking at whether to apply for a British certificate. Such decisions would have to await clarity on future traffic rights between Britain and the EU.

Wizz Air also announced two new routes from Frankfurt airport this week, meaning more low-cost competition for German carrier Lufthansa (LHAG.DE) at its home base after Ryanair (RYA.I) announced a deal to start flights this summer.

Varadi said Wizz expected to expand flights from Frankfurt in the future, given its attractive customer profile. But he said Wizz was not at present looking at Munich, where budget carrier Transavia, part of Air France-KLM (AIRF.PA), has said it would shut its base from October. He said Wizz is happy flying from nearby Memmingen.

(Reporting by Alistair Smout and Victoria Bryan; Editing by Paul Sandle/Ruth Pitchford)