A lot of things are going right for EasyJet following a long period of patiently waiting for the airline industry to recover from the pandemic.
It is flying more passengers, ticket prices are higher, growth for its package holidays arm is better than expected, and it has lifted full-year profit guidance.
AJ Bell’s Russ Mould said: “However, it is still fighting higher fuel and operating costs and the return of air traffic control strikes.
“The big unknown is demand for last-minute breaks. While advance bookings have been encouraging, the more plane tickets go up in value, the more certain people will be priced out of taking a foreign holiday.
“Many people book closer to the desired departure date, but there is a good chance a large chunk of this group will get to May or June and realise it is going to cost them more than they thought for a week of sun and sea.
“Jet fuel prices have been falling, yet airlines are unlikely to cut their ticket prices when they’re still playing earnings catch-up from the pandemic. The industry will probably take the bet that consumers cave into higher prices and accept their holiday is going to cost more this summer. That’s a risky move, but airlines have form in getting every last penny from the customer.”
Leave a Comment