UK's London City Airport reported (11-Jun-2013) record monthly traffic with 315,514 passengers in May-2013, the highest monthly figure in its 26 year history. The airport stated it also recorded its busiest ever week and day in May-2013, with 15,697 passengers on 23-May-2013. [more - original PR]
London City Airport reports busiest monthly traffic in May-2013
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All-premium UK-US airlines. BA cuts LCY frequency; La Compagnie quits LTN; Odyssey to launch in 2017
There have been two notable recent developments in the market for all-business class services on the North Atlantic: British Airways is to reduce its London City-JFK A318 frequencies and France's La Compagnie is to withdraw from Luton-Newark to concentrate its 74-seat Boeing 757 operations on Paris-Newark (its only other route).
BA's 32-seat London City operation has been suffering from significant load factor declines, particularly on the outbound flights. These flights make a refuelling stop in Shannon, where passengers can pre-clear US customs, but this may not be a sufficient incentive for some passengers to take an indirect flight. La Compagnie expressed concerns about uncertainties in the UK post-Brexit, but its route economics must anyway have been struggling, due to Luton's lack of suitability as a premium market and its lack of feed.
So far there has been no reaction to these developments from the new-start Odyssey Airlines, which plans to launch an all-business class London City-New York service in 2017. It will no doubt be attempting to find a balance between relief that its level of competition has reduced, and some anxiety that its launch may coincide with a softening of market demand.
Jet2.com: LCC airline's summer may be cooled by new Boeings, despite parent group's profit leap
Jet2.com is more summer-biased than almost any European airline, in spite of a capacity cut last summer. This reflects its strong leisure focus and its interdependence with the tour operator Jet2holidays. In the year to Mar-2016 Jet2holidays supplied 40% of the UK LCC's passengers, up from 17% in FY2013, since when it has been responsible for all of the airline's traffic growth.
Dart Group owns and runs both Jet2.com and Jet2holidays as the single business segment Leisure Travel (95% of group operating profit). The underlying operating profit of the Leisure Travel segment more than doubled for the year to Mar-2016, reaching the highest margin since FY2009, thanks to yield growth and increased sales of higher-end package holidays.
Strong advance sales insulate Jet2.com and Jet2holidays from the impact of Brexit in the short term. Nevertheless, their strong dependence on summer leisure demand exposes them to any volatility that may result from growing geopolitical and macroeconomic risks. Moreover, an order for 30 new Boeing 737-800s marks a departure from Jet2.com's strategy of buying and operating old aircraft that are close to being fully depreciated. This may increase the pressure on the airline to deploy its assets on a more year-round basis.