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Averted strike action cannot salvage Aer Lingus share price

Analysis

Aer Lingus shares dropped 4.9% but the carrier has managed to avert strike action by its pilots after last minute negotiations between unions and management. The airline has offered financial incentives to pilots, offering to buy back leave days from them over its busy summer period.

Summary
  • Aer Lingus avoids pilot strike through last-minute negotiations and offering financial incentives.
  • Threat of strike action still remains, with industrial action suspended until 01-Jul-2011.
  • Pilots at Belfast and Gatwick airports also vote for potential industrial action.
  • easyJet reports 11.3% year-on-year increase in passenger numbers for May 2011.
  • easyJet's passenger load factor decreases by 1.7 percentage points to 84.1%.
  • airberlin reports 3.9% year-on-year increase in passenger numbers for May 2011, with a passenger load factor of 75.8%.

The threat of strike action has not fully eased, with industrial action only suspended until 01-Jul-2011 and pilots at Belfast and Gatwick having also voted for industrial action.

easyJet reported the following traffic highlights in May-2011:

  • Passenger numbers: 4.7 million, +11.3% year-on-year;
  • Passenger load factor: 84.1%, -1.7 ppts.

airberlin reported the following traffic highlights in May-2011:

  • Passenger numbers: 3.3 million, +3.9% year-on-year;
  • Passenger load factor: 75.8%, +2.1 ppts.

Selected European airline share price movements (% change): 06-Jun-2011

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