EasyJet set to seize abandoned routes

Sky-high fuel bills will force cash-strapped airlines to drop routes - and easyJet is ready to swoop in and pick them up, chief executive Carolyn McCall said today.

The budget carrier showed how heavily the fuel burden is weighing on its own costs, after its half-year loss almost doubled to £153 million.
Of that, £43 million was due to its higher fuel bill.

But McCall claimed that the expense of jet fuel would also lead to business opportunities for the carrier.

"Inevitably, higher fuel costs will lead to extra capacity as we'll see withdrawal from competitors," she said.

"But we have a strong balance sheet, and we're in a prime position to secure peak-time slots and increase yields if someone comes off a route."

In good news for investors, but a bad sign for passengers, easyJet said it was working on the "optimisation of fees and charges to partially offset increased fuel costs".

In plain English, that means the airline has already raised its booking and credit card charges by around £5.

In the six months to April passenger numbers increased 12% to almost 24 million.

EasyJet said it had sold almost half of its summer seats, and expects its revenues per seat in the second half to be slightly ahead of last year.

The airline added that its new "flexifare" proposition for business travellers will go on sale for the first time on its website at the end of this month.

Founder and largest shareholder Stelios Haji-Ioannou today welcomed McCall's decision not to buy more aircraft but repeated his insistence that the company should return more cash to shareholders.

He said: "The company's balance sheet is too lazy as a result of the previous absurd policy of zero dividends for 11 years after the IPO."