EasyJet is taking an axe to its summer schedule and cancelling thousands of flights as staff shortages continue to put pressure on the airline sector.
The airline now expects its third quarter capacity to be around 87% of FY19 levels, and Q4 to be around 90% of FY19 levels. It had previously guided 90% of FY19 in Q3 and 97% of FY19 in Q4.
EasyJet is blaming air traffic control delays and staff shortages in ground handling and at airports, for increased aircraft turnaround times and delayed departures, which have resulted in flight cancellations. The idea behind the cancellations is that it brings certainty to customers who may have already booked flights.
It is not just the airlines that are trying to get ahead of the negative headlines. Europe’s airports are also putting caps in place. Heathrow, Gatwick and Amsterdam are asking airlines to cut flights.
What They Said
Johan Lundgren, EasyJet CEO said: “While in recent weeks the action we have taken to build in further resilience has seen us continue to operate up to 1700 flights and carry up to a quarter of a million customers a day, the ongoing challenging operating environment has unfortunately continued to have an impact which has resulted in cancellations.
“Coupled with airport caps, we are taking pre-emptive actions to increase resilience over the balance of summer, including a range of further flight consolidations in the affected airports, giving advance notice to customers and we expect the vast majority to be rebooked on alternative flights within 24 hours.
Perfect Storm
Airlines are dealing with a perfect storm of increasing travel demand at the same time as staff shortages. Having faced lockdown restrictions for two years, people want to travel abroad but airlines and others in the travel and tourism ecosystem lost a sizeable chunk of their labour force during the pandemic and have found it hard to replace them.
It’s therefore a terrible time for airlines to be struggling to get flights off the ground and difficult to see this problem sorting itself out in the short term.
Hotel Impact
The majority of customers will need to fly to get to their hotels this summer, which means cancellations are bad news. Of course it will only affect a relatively small number of people but them negative headlines could put a dent in the lasts market with people simply deciding not to travel by plane.
Given the levels of pent-up demand, many hotels will have already sold their inventory during the peak holiday period. Even so, if this continues to rumble on throughout the year and into 2023 it could have a small impact.
The bigger problem, however, is likely to come from the financial world with inflation heading upwards and talk of recessions across some key source markets like the UK.
“The next few months could see a collision course for tourism as opposing forces meet. Strong underlying demand for travel, improving COVID-19 sentiment and high, albeit falling, personal saving rates will continue to drive up tourism arrivals and, hence, hotel occupancy. However, intensified financial concerns, linked to the upward spiral in inflation and its impact on the global economy, may weaken this positive momentum,” analysts at STR said.