Jet2 says summer price increases will be ‘modest’
The chief executive of Jet2 promised customers would see only “modest” price increases this summer as the low-cost airline and tour operator announced record earnings amid a continued travel boom. The UK-based airline and tour operator reported a 43 percent increase in annual pre-tax profits on Thursday, reaching £529.5 million due to a surge in demand, with profits, revenue, and passenger numbers all reaching new heights.
The Leeds-based company, which operates from 12 UK airports to over 70 destinations, anticipates sustained strong demand but pledged to keep prices “attractive” during the peak summer months, partly in response to a trend of customers booking trips later. Jet2 noted, “passengers are currently booking much closer to departure and therefore, pricing for our flight-only and package holiday products must remain attractive.”
The cost of the group’s package holidays rose by 11 percent last year to an average of £830, as it increased fares to counter rising input cost inflation. The flight-only net ticket yield per passenger rose by 14 percent to £114.23.
On Thursday, Jet2 stated it was “mindful” of the economic pressures on customers and planned only a “modest increase” in summer prices. Chief executive Steve Heapy remarked, “Demand is as strong as ever... People just want to get away and escape the terrible weather they’ve seen in the UK, and I don’t see that changing anytime soon.” However, he noted that customers booking later resulted in a lower load factor (a measure of seats filled) year on year, currently at 73.4 percent, down from 75.2 percent.
Jet2 reported a 24 percent increase in turnover to £6.3 billion and said “future confidence” in strong demand had led it to exercise its remaining purchase rights for Airbus aircraft, with 146 A321neo planes to be delivered by 2035.
This update comes amid a rising backlash against tourism in European countries like Spain, where an influx of visitors has sparked what residents are calling “tourism-phobia” due to issues like unsightly new resorts and soaring rental prices. Heapy mentioned that Jet2 had not observed a decline in bookings for those destinations and expected people to be “drawn to the providers of licensed accommodation” such as Jet2.
In May, Sebastian Ebel, the chief executive of Europe’s largest travel company Tui, asserted that anti-tourism protests posed “no threat” to their business.
