According to easyJet, British tourists are cutting back on takeaway, restaurant meals and retail purchases in order to afford international travel during the winter months (October 2022–March 2023).
The largest low-cost airline in the United Kingdom lost £411 million in the first half of its fiscal year, or an average of £12.40 for each of the 33.1 million passengers flown during the cold season.
For comparison, in the year prior, when travel restrictions due to Covid were at their height, easyJet lost $545 million on 23.4 passengers, or an average of £23.30 per passenger.
The coming summer is looking profitable, with the package branch, easyJet Holidays, on track to achieve £80m in profit over the full financial year. This is due in large part to the fact that flights between July and September this year are already 73% booked, ahead of the similar 2022 figure.
According to easyJet, the rise can be attributed in part to the fact that British customers now place a higher importance on vacationing after the coronavirus outbreak. According to a poll conducted by the airline, vacations have surpassed the payment of monthly bills as the second most important expenditure.
EasyJet reports that 45% of British vacationers are cutting back on takeaway, 42% on restaurant meals and 30% on new clothes in order to save money for their summer getaways.
EasyJet CEO Johan Lundgren announced the company’s financial results by saying, “we enter the summer with confidence thanks to our optimised network, the strong demand seen for flights and holidays, enhanced revenue capabilities, and operational resilience.”
Customers are increasingly choosing low-cost airlines and companies that provide exceptional value, and recent studies have revealed that travel is the top discretionary purchase for American households.
With almost eight percent more capacity than in 2019—the last year unaffected by the Covid crisis—the airline will operate its largest-ever UK flight programme this summer.
The airline has a “hedge” in place that has three-quarters of its fuel needs priced at $885 per tonne, although the spot price is about $720. This “hedge” has resulted in the airline paying 23 percent more than the market rate for most of its fuel between.
Retail and commercial litigation partner at Gowling WLG Emma Carr commented on the results, saying, “easyJet is currently navigating through economic turbulence, and despite introducing new cost control measures and adding additional routes to its offering, more is needed to strengthen its margins.”
EasyJet, a competitor of Jet2, will base three planes at Birmingham next summer, 2024, just a day after Jet2 announced a new base at Liverpool John Lennon airport.
However, the reduction of easyJet’s operation at Berlin’s new airport from 18 to 11 aircraft is reflected in the financial figures and costs the company £4 million.
