• Wed. Nov 6th, 2024

Is EasyJet Heading for Heathrow? ‘Let’s See’ Says Airline CEO

Byusanewscart.com

Mar 26, 2024
Is EasyJet Heading for Heathrow? ‘Let’s See’ Says Airline CEO

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Skift Take

Speaking to Skift, easyJet CEO Johan Lundgren confirmed that the West London hub is on the low-cost carrier’s radar.

Could easyJet add one of the world’s most expensive airports to its route map? 

Speaking to Skift, easyJet CEO Johan Lundgren said the budget airline would consider Heathrow, subject to certain criteria being met. 

The low-cost carrier is no stranger to high-end airports. It already has a major presence at premium locations across Europe. This includes Paris Charles de Gaulle and Amsterdam Schiphol where it operates dozens of daily departures. 

Lundgren described flying into major hubs in European capitals as “very much part of our model.” He highlighted Heathrow as “probably the only prime airport, bar Madrid, that we’re not flying from.”

Alongside what he describes as “the right conditions,” Lundgren emphasized the need for any future easyJet presence to be of a certain size. “We’re not talking about one or two aircraft. You would need to get a little more scale in there.” 

Airlines usually like to spread airport operational costs across multiple routes and/or daily frequencies. A smaller presence means any fixed overheads are concentrated on a smaller number of flights, which can impact overall profitability.

What’s Stopping EasyJet?

So if it isn’t the business plan, what’s holding easyJet’s Heathrow ambitions back? Put simply, Heathrow is full.

The London gateway is one of the world’s busiest airports. Despite having just two runways, it boasts links to more than 200 global destinations.

Of these, 24 routes broke the million-passenger milestone in 2023. This helped lift Heathrow’s annual passenger total for 2023 to 79 million – a welcome boost from the Covid-19 slump years, but still short of 2019 when 80.9 passengers used the complex. 

Chronic constraints on capacity mean slots – the right to operate an arrival and departure – are strictly controlled.

Airlines have previously bought and sold landing rights for millions of dollars. In 2016, Oman Air reportedly paid $75 million for a slot pairing in a deal with Air France-KLM.

Turning Crisis Into Opportunity?

Although Lundgren said easyJet is interested in serving Heathrow, he appeared to rule out a similar slot deal – especially at premium prices.

The CEO suggested it may take an airline failure and the associated redistribution of landing rights for easyJet to make a move. “If there becomes a casualty among the operators at Heathrow and the pricing is right, then who knows,” he said.

Asked by Skift if this meant the launch of Heathrow was a case of when rather than if, Lundgren said “let’s see,” adding that any opportunity remained at a hypothetical stage.

Slots at Heathrow are allocated twice a year by independent body ACL. The organization, partly funded by UK airlines, is legally required to act neutrally.

Vueling, which is part of British Airways owner IAG, is one of only two low-cost carriers to fly European routes from Heathrow. The other is Eurowings, which is part of the Lufthansa Group.

As easyJet is an independently run operator, it is unable to copy the template of acquiring landing rights from a parent company or affiliate group. 

Could EasyJet Go Head-to-Head With BA?

Lundgren hinted that if easyJet was to enter Heathrow, intra-UK flights would be part of the mix. “Heathrow needs and would benefit from more domestic connectivity. They don’t have a low-cost airline there, they don’t have very attractive fares.”

At present, British Airways has a near-monopoly on domestic flights from Heathrow.

The UK flag carrier is the only company linking the hub with major markets such as Edinburgh, Glasgow, and Manchester. Regional airline Loganair operates a handful of links to smaller towns and cities under a public service obligation scheme – yet even these operate in partnership with British Airways.

If easyJet were to enter Heathrow, it would represent its final piece of the London airport jigsaw puzzle.

The budget airline is already the biggest player at Gatwick, the city’s second-largest airport. It also has a significant presence at Luton, where the company has its global headquarters. EasyJet also serves London Stansted and Southend airports. 

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