Easy Jet is predicting that airlines will see a fall in demand of between two and four per cent this winter.
The low-cost carrier said it expects its annual pre-tax profit to fall by ten per cent to £110 million as a consequence of the gloomy outlook.
Strong growth in total revenue per seat that had been witnessed over the summer will reportedly tail off due to the economic downturn.
The carrier’s stock has lost more than 40 per cent of its value so far this year and had already committed to reining in some services in order to cope with heightened operating costs.
Those difficulties have been marginally offset by the recent fall in oil prices – down from a July peak of $147 to just $95 per barrel – but analysts insist the situation remains volatile.
Numis Securities wrote a research note warning that easyJet’s prediction may be understating the problem.
Assessing the industry situation in general, it voiced concern about the winter trading outlook “as pressures on the consumer accumulate and the outlook for employment in the UK deteriorates”.
Earlier this week, BA chief executive Willie Walsh warned the airline industry is going through its worst-ever crisis.
source to this post: EasyJet predicts winter air travel will fall
From the Winter and summer travel website