EasyJet Hits 10 Million Business Passengers As It Reports A Strong Start To 2013

EasyJet Off To A Flying Start For 2013

EasyJet marked the start of the new year with a new milestone - 10 million business travellers have used the budget airline in the past year.

The low-cost carrier hopes the boom in business passengers will increase further after completing the roll-out of seat allocation. Flights between top business destinations have been added in recent months, as well as flexible tickets in an attempt to steal corporate customers from legacy carriers such as IAG's British Airways.

Ryanair told the Huffington Post UK it estimates its business traveller count in 2012 was between 15 and 19 million.

In addition, around 80% of its seats for the first half of the year are already booked, easing EasyJet's concerns about first half losses.

The loss before tax for the first six months of the year is now expected to be between £50 million and £75m - far better than the £112m loss reported in the first half of 2012.

Short-haul carriers have been attacking the main carriers' for business travellers for some time now - according to the Civil Aviation Authorities' 2011 report into business travel, the combined share of Ryanair and EasyJet's business travellers at the London airports increased markedly from 2% to 17% between 1996 and 2007 while that of BA and

bmi fell from 37% to 26%.

The report also showed of the 100 or so routes served by Ryanair, only about 5% of the routes carried 30% or more business passengers on average. By comparison, 27% of the short-haul routes served by EasyJet from London and 67% by BA had 30% or more business passengers on board.

Commenting on the results, Carolyn McCall, EasyJet's chief executive said in a statement the airline was also helped by competitor capacity reductions - capacity among rivals fell by 2.1% or 800,000 seats on routes EasyJet flies for the final three months of 2012.

"The good performance in the quarter and the structurally advantageous position that EasyJet occupies in the European short-haul market means we remain confident in our outlook for the business.

"Although the economic environment remains challenging, EasyJet's strong customer proposition, combined with the actions that management are taking ensures that easyJet is well positioned going forward to deliver sustainable growth and returns."

The bad news for consumers is the cost of your EasyJet seat has gone up - revenue per seat grew by 3.9% on a reported basis to £53.87 per seat.

Nick Hood, business analyst at Company Watch, told the Huffington Post UK that any expansion plans through substantial investment at a time when its rivals have been cutting theirs would be "a judgement call", but stakeholders will be concerned about the ongoing Eurozone crisis's impact on the aviation market.

"Financial resources at EasyJet are under no particular pressure ahead of the planned expansion, with acceptable debt levels and an overall financial profile comfortably above average," he said.

"But management and other stakeholders will be mindful that conditions in the European aviation market could deteriorate rapidly if there was a return to last year's crisis in the Eurozone, should the current sticking plaster solutions prove as inadequate as some fear."

EasyJet's figures come in stark contrast to the woes faced by Exeter-based regional airline Flybe, which yesterday announced around 300 job losses as it battles to cut costs by £35 million to stem losses.

Close

What's Hot