Low-cost airline easyJet is predicting a surge in demand for air travel once COVID-19 vaccines are successfully rolled out across Europe. Tony McDonough reports
Budget airline easyJet claims “pent-up demand” is likely to lead to a surge in bookings if the COVID-19 vaccines are successfully rolled out across Europe.
And the carrier, which prior to the pandemic operated more than 30 routes out of Liverpool John Lennon Airport, says it retains the “flexibility to rapidly ramp up to capture that demand”.
Similar to its main rival, Ryanair, easyJet has worked to shore up its balance sheet since the start of the COVID-19 pandemic in March 2020. It has raised cash through sale and leaseback deals on aircraft and, most recently, has secured a £1.4bn Government-backed loan.
Aviation has taken a battering from the pandemic with planes across the world grounded for weeks at a time. In November, easyJet reported a pre-tax loss for the 12 months to September 30, 2020, of £1.2bn. It was the first full-year loss in its history. Passenger numbers for the full year plummeted 50% to 48.1m.
In a trading statement on Thursday, easyJet said it had responded “decisively” to the crisis with a number of actions to maintain a strong balance sheet. All these actions, it said, will see it emerge from the pandemic more efficient, with its cost base reset.
The company’s first quarter financial performance was in line with management expectations despite increased uncertainty due to the changing environment which saw strengthened travel restrictions and fresh lockdowns across Europe.
Subject to continued progress on vaccinations, together with the future relaxation of government travel restrictions across Europe, easyjet is anticipating a release of pent-up demand for travel.
It conducted among 5,000 European consumers between January 8 and 20. It showed that 65% have or plan to make a travel booking in 2021, with existing easyJet customers even more likely to travel rising to almost three quarters planning a trip this year.
Johan Lundgren, easyJet chief executive said: “We have taken the right actions to emerge leaner with a reduced cost base and the retrenchment of legacy carriers at key airports will provide additional opportunities for easyJet.
“Our core strengths remain unaffected by the pandemic. We have loyal customers who know and trust our brand, an unmatched network, offer value for money and a leading position on sustainability with high customer satisfaction.
“The key to unlocking travel is going to be the vaccination programmes combined with governments progressively removing restrictions when it is safe to. And in the meantime, our flexible industry-leading policies mean that customers can make plans and book with confidence.”