EUROPE: easyJet predicts collapse of weaker carriers

Europe’s weaker carriers will "downsize and disappear", as the "laws of the jungle" play out under extreme fuel prices and continued expansion by the leading low cost carriers, easyJet CEO, Andy Harrison, has predicted, according to Centre for Aviation. Harrison stated that airlines which operate older, less fuel-efficient fleets and have higher cost bases are […]


Europe’s weaker carriers will "downsize and disappear", as the "laws of the jungle" play out under extreme fuel prices and continued expansion by the leading low cost carriers, easyJet CEO, Andy Harrison, has predicted, according to Centre for Aviation.

Harrison stated that airlines which operate older, less fuel-efficient fleets and have higher cost bases are particularly vulnerable and his prediction follows statements last month by bmi chairman, Michael Bishop, that the slowing economy and record fuel prices would lead to a clear division of airlines into the "haves and have-nots".

The airlines that continue in the current difficult conditions "would be determined largely by their fuel hedging positions". Start-up airlines and airlines with insufficient scale were most vulnerable, said Bishop.

EasyJet more than trebled its net loss for the six months ended 31 March to £43.3 million (US$85.4 million) from £12.7 million in the same period a year earlier as a result of higher fuel costs and the integration of GB Airways.

GB’s trading loss in the first half was £7 million and the underlying easyJet loss was £41.4 million compared to a loss of £17.1 million in the previous fiscal semester. Total revenue rose 24 per cent to £892.2 million.