Thomas Cook collapse makes it plane sailing for easyJet

Business

Thomas Cook collapse makes it plane sailing for easyJet

Airline, which favours Airbuses, is also benefiting from the misery of competitors that own grounded Boeings

FT.com

“Competition is a sin!” railed oil tycoon John D Rockefeller. He thought business was best conducted without pesky rivals. One fewer for low-cost European airline easyJet is certainly proving beneficial. Revenue per seat rose almost 9% in the three months to December, helped by the collapse of rival Thomas Cook in September. On Tuesday, EasyJet shares lifted as much as 5%.

EasyJet, which favours Airbuses, is also benefiting from the misery of competitors that own grounded Boeing 737 MAX aircraft. This is putting a cap on capacity growth expectations, including those of Ryanair. That could mean an opportunity to grab market share if demand is as “robust” as easyJet claims. 

EasyJet thinks its capacity will rise 3% in 2020, faster than the industry. Ryanair hopes to achieve similar growth. That depends on it receiving 10 new 737 MAX jets in the middle of the year. The odds of this are lengthening as more problems with the MAX emerge. Easing back on the throttle and cruising might be a better option for EasyJet. The Brexit uncertainty that hit last year’s trading may have passed. The event itself could still involve nasty turbulence...

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