easyJet to cut back on services
Budget airline easyJet is to close its East Midlands base and reduce services at Luton airport by 20 per cent, it announced today.
The low-fare carrier also said it would be consulting on a reduction of the number of flight crew at Belfast, Bristol, Newcastle and Stansted airports.
EasyJet blamed the cutbacks at Luton on "the airport's failure to recognise the commercial realities of the recession", while saying that its East Midlands airport operation had "remained stagnant for many years".
EasyJet said flights to and from East Midlands airport up to the end of the year are "wholly unaffected".
Passengers travelling to and from East Midlands beyond the end of this year would be informed well in advance if and how their travel might be affected.
The airline employs 120 staff and operates three aircraft at East Midlands, and carries around 700,000 passengers a year.
The consultation on crew numbers at Belfast, Bristol, Newcastle and Stansted affects about 40 pilot and cabin crew jobs.
EasyJet has 530 pilots and cabin crew at Luton where it operates 16 aircraft and carries 4.7 million passengers a year.
EasyJet said it had opened a formal 90-day consultation with its crews at Luton and East Midlands, adding that it was the airline's intention to redeploy as many staff as possible.
The carrier added that following the Luton and East Midlands' re-organisation it would move flights to "more profitable airports" with most of the aircraft being used at its continental bases.
The airline also said that its overall growth plans remained unchanged at around 7.5% per year "over the medium term".
The airline said airport costs at Luton had risen by 25% over the past three years which made the Bedfordshire base "no longer competitive".
The carrier had been in protracted negotiation with Abertis, the Spanish operator of Luton and its owner Luton Borough Council, but these negotiations had broken down.
EasyJet added that the situation at both airports had been exacerbated because of the rise in the Airport Passenger Duty (APD) airport departure tax.
EasyJet chief executive Andy Harrison said: "We are one of only a few airlines expecting to make a profit this year. A critical part of our success has been optimising the allocation of our aircraft across our 19 European bases. This means responding to airports with uncompetitive costs, as well as moving swiftly to seize opportunities as competitors retreat."
"I am deeply disappointed that Abertis and Luton Borough Council have not taken a more far-sighted approach which would have protected jobs at Luton.
"At a time when jobs are under threat in the town the airport should be an engine for growing employment, not a source of further unemployment. This can only happen, however, if the owner and the operator make the right commercial decisions and deliver a competitive cost base."
He went on: "In regard to East Midlands we cannot see a growing long-term future and we have decided to move our assets to markets with better long-term potential.
"The rise in APD hits regional airports hardest and increases the pressure to move aircraft to mainland Europe. The Government seems to think that APD is a free lunch. It isn't. It costs jobs in the UK."
EasyJet also announced today it carried 4.8 million passengers in August 2009 - an increase of 4.7% on August 2008.
The airline operates 175 aircraft on 437 routes to 111 airports in 28 countries. It has carried more than 44 million passengers in the last 12 months.
Kevin Hall, regional officer of Unite, which represents easyJet's cabin crew, said: "This is extremely worrying news for the staff working at the airline. EasyJet's business model makes it a flexible company so there are no excuses for compulsory redundancies if the company works constructively with Unite.
"Unite has meetings scheduled with easyJet and we will be doing everything possible to ensure the company maximises the opportunities for redeployment."