- Capacity estimates trimmed for Q3/Q4
- Forward booking are encouraging
Anyone embarking on a European summer break would have already noticed that the airport process has become an even more fraught affair. Investors in easyJet (EZJ) have been placing their faith in a resurgence in post-pandemic bookings, and on that score alone they can be pleased enough, with fourth-quarter (Q4) bookings roughly on par with 2019.
Unfortunately, the 2022 summer season has shown that although the appetite for holiday travel gives cause for encouragement, the ripple effects of the Covid-19 travel bans are going to be with us longer than anticipated, or as bosses at easyJet put it “the post-Covid supply chain issues being seen in many other parts of the economy”.
They amount to shortages in ground handling staff and air traffic control delays, leading through to increased aircraft turnaround times and delayed departures. Consequently, flight caps have been introduced at two of the carrier’s biggest airports, London Gatwick and Amsterdam Schiphol.
It is also now “proactively consolidating” flights across affected airports, which is an oblique way of saying they are cancelling some of them, the precise number of which is still unclear, although it will run into the thousands.
Passengers subject to the cancellations will have the option of rebooking on other easyJet flights, but it’s unlikely to play well with travellers, particularly as many will not be able to be flexible on dates, while others could effectively be lumbered with ancillary costs linked to hotel cancellations, etc.
Overall, easyJet now expects its third-quarter capacity to be around 87 per cent of 2019 levels, rising to 90 per cent during the final quarter of the year. It had previously anticipated delivering 90 per cent of 2019 capacity in the three months to June, rising to 97 per cent over July, August and September.
Until the baggage handling difficulties are overcome there is little that industry bosses can do. The airline anticipates increased costs for every single available seat kilometre (ex-fuel) due to rising leasing, airport charging and crew costs, although it believes these will be one-off issues.
