Moved Permanently

Part of the answer appears to be Easyjet’s determination to maximise the use of each and every aircraft.  Each flight can cover its costs, but only if every single seat is filled.  The low fares obviously encourage this.

Easyjet’s expensive strategy of only using major airports in each of its European destinations has also easily ‘made back’ its costs by the volume of business customers it attracts.  As well as each of the 166 strong fleet of aircraft being full each time it takes off, the average turnaround time of 30 minutes means each craft spends as much time as possible in flight rather than spending several unprofitable hours on a runway.

The other ways that Easyjet cuts down costs for itself are more well-known.  Not a single paper ticket is ever sent out – Easyjet has conducted most of its bookings online since the late 1990s.  All extraneous costs that traditional flights incur such as on-board meals and individual seat reservations do not bother Easyjet as they are never offered: you literally just pay for the flight, with no extra ‘frills’.

Easyjet’s main competitor, Ryan Air, implements similar strategies to cut costs. Branding themselves ‘Britain’s lowest cost airline’ they only charge the customer airport taxes and do not add a ‘fuel charge’ onto their ticket price.

Yet, due to rising oil prices and the economic downturn, analysts believe low cost airlines will not be able to survive. Ryan Air’s profits are reportedly down from £320million to £170million already.

Furthermore, the EU gave their formal approval on Friday to include aviation in the Emissions Trading Scheme from 2012. This means airlines will have to pay an environmental tax if they go over an agreed level of CO2 emissions, in the hope this will reduce air traffic.

So what does the future hold for the budget airlines?

EasyJet say they will continue their low prices and absorb extra fuel costs even if it means losses, as in the long run the airlines with higher ticket prices will lose customers and collapse. Then Easyjet will have less competition and finally be able to raise ticket prices to cover their losses.

They are compensating in the meantime by including sneaky baggage costs, booking fees and priority boarding charges.

As for now these airlines are still churning out cheap flights. Ryan Air are currently offering £10 flights, including all taxes , from a choice of 250 routes. Sounds tempting doesn’t it?