Budget carriers predict greater shift to low cost travel

EasyJet and Ryanair, the two largest budget airlines in Europe, are likely to benefit from the current financial crisis gripping the region, executives at both companies have said.

The worsening credit crisis fuels concerns about a recession globally, and the two low-cost European carriers are predicting that more travelers will begin to favour discount carriers as they seek to lower spending on travel.

“We’re clearly winning market share from our competitors,” commented the chief executive of Luton-based easyJet, Andy Harrison, during an interview last week. “In a world where all you can see in the papers today is about the credit crunch and cutbacks, you can see that EasyJet is doing incredibly well.”

The CFO of Dublin-based Ryanair, Howard Millar, has forecast that in 10 years, the Irish low-cost carrier – Europe’s largest – along with EasyJet, the second-largest, will be the only budget carriers left serving the European market.

“There will be less players in this market and that’s the reality of what’s happening,” noted Millar in comments he made in London last month at the World Low-Cost Airlines Congress. “This industry is changing and there will be enormous opportunity for those left standing.”

With the outlook for the economy remaining gloomy, budget airlines are betting that passengers will choose to go without assigned seats and free drinks to save on airfares.

Thanks to www.bloomberg.com for the above quotes, for more information on this article please visit their website.

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