EasyJet optimistic about summer as leisure travel demand picks up

Low-cost airline EasyJet said the operational problems plaguing the airline industry would not derail a strong summer, but cautioned that the financial pressures facing consumers might threaten demand later in the year.

The London-listed airline said on Thursday that it expected to fly 90 per cent of its pre-pandemic schedule between April and June, rising to 97 per cent for the following three months.

Bookings have risen to 6 per cent above 2019 levels in the past 10 weeks, thanks to a surge in demand for leisure and domestic flying as travel restrictions have eased.

EasyJet reported a pretax loss of £545 million (€643 million) for the six months to the end of March, down from a loss of £701 million the previous year and in line with guidance issued last month. Revenues rose more than fivefold to £1.5 billion.

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EasyJet’s aims are slightly more cautious than rival Ryanair, which this week outlined plans to fly 115 per cent of its 2019 flight schedules in the summer.

The rapid recovery has come as parts of the aviation industry have struggled to cope with the sudden influx of passengers. EasyJet was forced to cancel scores of flights this spring because of staff shortages exacerbated by a wave of Covid-related absences.

The airline went as far as stripping out some seats from its planes to allow it to fly with fewer crew under flight safety regulations, but chief executive Johan Lundgren said the problems had not hit bookings and that people were still keen to travel.

“Bookings are not affected and are particularly strong, it shows the pent up demand is there,” he said.

Cost of living crisis

Despite the optimism, the company joined Ryanair in declining to give guidance for the rest of its financial year, which ends in September, pointing to “the continued level of short-term uncertainty” driven by customers booking later than was normal before the pandemic.

Mr Lundgren said he expected the cost of living crisis to “certainly have some effect”.

“It is too early to tell, but there is uncertainty over how this plays out in the winter,” he added.

Ryanair chief executive Michael O’Leary has gone further and warned of a tough winter amid fears of a recession and pressure on consumer spending.

EasyJet and Ryanair have said they expect to be insulated against the worst effects of the cost of living crisis because passengers have historically turned to lower-fare airlines when faced with economic uncertainty.

“Even with a negative outlook, we know we will be in a better position than others,” said Mr Lundgren. – Copyright The Financial Times Limited 2022