[BigDog.]

Oh dear Xuluman you really are discombobulated.

A growing company will of course have a growing costbase duh!! Given my first post went over your head I will try to make this simpler for you. You need to look at the ratios whilst growing – ROI, ROE, EBITDA – and ask are these consistent. Simply put,are your expenses growing faster than income and profits – not particularly in easyJet’s case, but need constant monitoring nevertheless. Their increase in ROCE from 11.3% to 17.4% is particularly impressive though.

Next step, have a look at Operating Costs here…

http://2012annualreport.easyjet.com/performance-risk/financial-review.aspx

Operating costs are costs you can somewhat control, they exclude fuel. For easyJet, crew costs are less than 20% of operating costs. Not the “by far and away the biggest expenditure they can control” as you attest.

Further, in 2007 crew costs amounted to 19% of operating costs, five years on, in 2012 crew costs amounted to 19.9% !!! Although crew costs have more than doubled over 5 years, as anyone with a smidgen of business acumen would tell you, you really need to view it in context of a growing company and not in isolation. In relative terms, crew costs have scarcely moved – far from a crew expense issue you suggest. (I hope you are not considering being an airline pilot as this is basic mathematics using readily available data)

So there is no need to worry yourself and to get into a tizzy about easyJet crew costs, nor is there any justification for your usual scaremongering. Now get back to the cab and in your free time start revising for GCSE business studies.

[HarryMonk]

Big Dog

Is there really any need for the aggression and rudeness in your posts? It is not the first time I have noticed this if somebody else has an opinion that differs from your own.

[lloydah]

Hey HarryMonk, perhaps you’d better read Xuluman at 20 16gmt before accusing Big Dog –

“You are completely clueless, yet once again insist on posting random articles which only prove how out the loop you are.

Just embarrassing. A little knowledge rather than your standard pathetic posturing would be appreciated.”

doesn’t seem too polite to me and would get the same sort of reply from me as BD offered.

[canucklad]

I’m going to pitch in on 2 points here.

Firstly, I’m going to fly against the prevailing winds so to speak. My advice to MOL is to stick to your guns and don’t start confusing your offer.

Yes Easyjet has moved on, it now finds itself in murky marketing waters…..Trying to compete with BA & FR. The more successful it becomes at challenging BA, in my opinion the more it will pay less attention to FR and I’m sure the perception will grow that it is not a cheap airline. And thus won’t necessarily be the point of call for those consumers who seek “low cost fares”

Ryanair’s clear blue water and their definite USP is that they (often wrongly) are perceived as the fly anywhere for buttons company.
My advice to MOL would be to exploit Easyjets recent going up market approach and remind the budget conscious who has been their champion. Remove Easyjet from their patch by pointing out that they now see themselves as a competitor to BA & not FR.

Stick to their strategy, it’s worked and is still working, mixed messages will endanger their most loyal customer base… We know your S**T but at least your cheap !

Secondly on the” Are you aware that EZY pilots based in France earn ~30% more than those in the uk”

An acquaintance that drinks in my local is an Easyjet pilot based in the UK, and for quite a period of time he was re-located to CDG on the same T&C’s as in the UK. This meant managing two households with all the associated cost. His take on it was, I need a job and EZ are much better than FR!

He likes working for EZ but is becoming increasingly stressed at the work /life balance as Easyjet management push for ever increasing productivity to lower their £’s per mile flown ratio.

[AMcWhirter]

Interesting development at Ryanair today.

As we all know, the carrier has tended to shun main airports in favour of smaller, more remote facilities.

Well two announcements today suggest a change of tack. Is this the “new Ryanair” in the making ?

For starters, Ryanair says it will operate a number of routes from Rome’s main Fiumicino airport next April where it will initially base six planes, rising to 12 from September 2014.

http://www.ryanair.com/en/news/ryanair-opens-3-new-rome-domestic-routes-and-allocates-6-aircraft-to-a-rome-fiumicino-base-rising-to-12-based-aircraft-in-sept-2014

Then from next February it will open 10 new routes from Brussels’ main Zaventem airport. It will base four aircraft at Zaventem and aims to carry 1.5 million new passengers.

http://www.ryanair.com/en/news/ryanair-announces-brussels-zaventem-base-from-feb-2014

It’s also rumoured that Ryanair is currently negotiating with Amsterdam Schiphol.

The expanson at Brussels and Rome would seem to be targetted at Vueling.

If so then will Vueling be able to compete against Ryanair’s lower cost base ?

[TimFitzgeraldTC]

Perhaps Ryanair have realised that to either retain there current customers numbers and/or to grow there numbers then they will have to start using mainline airports in larger numbers. I guess there must be a finite client base to secondary airports / routes and this now the only way to keep growing? Just a thought.

[MartynSinclair]

or FR realise they need the business traveller. Didn’t Easy once say, we would never have pre assigned seats!!!

[NameRemoved-18/12/14]

Many FR pax flying to Charleroi or Hahn are not travelling on to Brussels or Frankfurt respectively. They both have huge catchment areas and are very successful as a result.

[AMcWhirter]

It’s the same with Stansted etc which also has a separate catchment area besides London itself.

It’s unclear what will happen to Ryanair’s flights which currently use Charleroi. At present it would seem that the Brussels flights will be totally new, ie they are in addition to the existing Charleroi flights.

I could be wrong but I can’t see Ryanair wishing to serve Frankfurt’s main airport on account of its high fees and lack of slots. But Amsterdam is possible.

[Author]

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