[Anonymous]

[Henkel.Trocken]

It seems like EasyJet have some good news in the midst of so much doom and gloom about profitability of other carriers over recent days:

http://www.bbc.co.uk/news/business-20406120

A 28% rise in pre-tax profits to 30th September 2012. Now, how can I achieve that??

[SimonS1]

1. Build a clear business model that you stick to relentlessly. Simple fleet, point to point flights, aircraft that are not clapped out etc.

2. Offer cheaper prices on many routes, alternatively match competitors but generate higher profits through not being saddled by legacy infrastructure and pay conditions.

3. Use cheaper airports but ones that are still fairly easy to get to and less likely to be impacted by fog (Gatwick, Luton, Southend etc).

4. Deploy effective marketing, using headline prices that don’t contain all the added extras.

5. Reach out to business community by capitalising on market conditions and the fact that many people are cutting budgets (allocated seating now).

Seems to be working well really. After all on a 2 hour flight many people are not bothered whether they are on a legacy carrier or a LCC, on flights of that length the lack of a lounge of Avios etc is not a big deal.

[AnthonyDunn]

@ SimonS1 – 20/11/2012 15:26 GMT

Didn’t you mean to say “deceptive” marketing, using headline prices that don’t contain all the added extras….?

Otherwise, agree with your description; it was interesting listening to the CEO of EJ interviewed on BBC Radio 4’s “Today” programme this morning when she said that EJ now had a lot of corporate contracts for business flying. As, for example, Snr Management’s company (a quoted miner) does not permit Club/Business travel (below board level) for flights under five hours, they will fly with whoever offers the best corporate deals. Presumably, EJ is of more concern to BA/legacy carriers than Flyanscare….

[AMcWhirter]

I wonder what impact, if any, the current ME conflict might have on Easyjet’s passenger carryings to TLV and AMM ?

[SimonS1]

Indeed Anthony, a fine line between effective and deceptive.

However for me it works, let’s face it the food on most airlines is pretty grim, other airlines charge for seat allocation and whilst legacy carriers offer 20kg of baggage, usually when travelling on Easyjet I am only carrying hand luggage so why would I want to subsidise someone else who has the full 20kg?

Whatever they are doing works, and with allocated seats it avoids the excesses of Ryanair who I would never use.

[BigDog.]

Great to see Easyjet doubling its dividend to shareholders, yet still expanding.

http://www.telegraph.co.uk/finance/newsbysector/epic/ezj/9689705/Easyjet-doubles-dividend-as-profits-soar.html

Am sure Walsh will be eagerly announcing he is following suit – as doubling many years of zero dividend is still zero!

Pity BA’s profits will covering IB losses as opposed to paying dividends, improving quality or building new routes into China.

[AnthonyDunn]

@ BigDog. – 20/11/2012 23:02 GMT

Hi BD!

In tonight’s Evening Standard:

Under CEO Carolyn McCall (ex-Costain & Guardian Media Group; NOT an accountant), EJ shares have risen by some 69% from just below 400pence in July 2010, comfortably outperforming the sector and the FTSE All-Share index over the same period. EJ’s market capitalisation now stands at some £2.66Bn and the company, if it continues with this trajectory, can soon expect to make it into the FTSE-100. They also pay dividends…

Punctuality (arrival within 15 mins of scheduled time) rose by 9% last year to 88%. The company has specifically targeted business flyers and this has contributed to the take up of top end flexible fares.

[FormerlyDoS]

AnthonyDunn – 20/11/2012 15:59 GMT

Maybe you should edit your post, as I don’t see how advertising that complies with the law can reasonably be described as deceptive.

easyJet quotes a price that includes the admin fee for card payment, other services such as paying for a specified seat, paying for luggage etc are optional.

I think your statement may be libelous.

[AnthonyDunn]

@ FormerlyDoS – 21/11/2012 09:32 GMT

I don’t post libellous (sp.) comments and this is a rather touchy post, if I might say.

You might care to reflect upon the Consumer Association and Office of Fair Trading’s repeat campaigns against airlines who post “headline” fares to which are then added a succession of “extras” such as check-in baggage, administration charges, seat allocation fees, airport check-in fees, printing boarding card charges etc.

Notwithstanding having used EJ and their website on countless many occasions before, I double checked just now to see whether my previous experience was still current and, lo and behold….

A random booking LGW-TLS in late November 2012 and the “headline” fare is £80 return. I then notice that in light grey, there is a £9 “admin fee” – to administer what? I then see that this is the so-called “Standard” as opposed to the “Flexi” fare… What is this I ask myself? Looking down, I see that in another set of light grey boxes there is mention that should I wish to take check-in bags, I need to continue to the next page to pay for these… Ah, for the 23kg allowance with BA, that’s another £64, and if I want to have an assured seat then that’s between £3-12 per sector, adding another £16. From EJ’s website, it now looks as if, from end November 2012, that assured seat booking will be obligatory, so that’s another so-called “extra” that now becomes an inescapable part of the fare. So, what started out as an £80 “headline” return flight is now priced at £169 (if paid for by debit as opposed to a credit card). No mention of any catering so I assume that it’s a case of bring your own coffee and sandwiches (or pay extra, once on-board, I assume…).

Should I wish to pay with a credit card, there is a charge of 2.5% with a minimum of £4.95 – that at least is consistent with BA.

Whereas you might consider these various charges to be options, I consider them bolt-on extras which, as the CA and OFT have repeatedly stated, are misleading. When those charges double the “headline” fare, it is indeed a moot point about the veracity of this fare and whether or not it is misleading and/or deceptive.

FYI, I also check out the “Flexi” fare which, clearly targeted at business passengers, comes in at £231 – actually a pretty good deal with the no-charge rebooking facility. As is apparent from my later posting (@ 21/11/2012 01:12 GMT), I am by no means hostile to EJ (unlike O’Blarney’s Sh*teair) or its business model.

I rest my case.

NB: Just checked the rival BA offer and it came out at £148.05

[EDITED]

[FormerlyDoS]

I think you are being touchy, Anthony, as well as making some assertions based on incorrect data.

Standard is easyJet’s unbundled product, allowing people to minimise cost by choosing what they wish to include, e.g. choosing to travel with hand luggage, whether they wish to pay to select a seat and changes come at a cost.

Flexi includes luggage, selected seat and changes are free etc – it is aimed at the business market and is a higher priced product with more included features.

You are wrong in stating that passengers (on a standard ticket) will have to pay for seats from November, only if they wish to select a specific seat, otherwise they can accept what U2 gives them at no cost.

From the U2 website

“Can I book a flight without selecting a seat?
Yes you can. You do not have to pay to select your seat, if you are happy to allow easyJet to allocate it for you. In this case we will allocate you a seat when you check-in, either by printing your boarding pass or at the check-in desk at the airport. “

Let’s look at BA, then, simply as you mention the airline.

It works similarly to U2, you get a seat allocated to you for free as part of the ticketed cost, but if you want to select a specific seat in advance and have that guaranteed, you pay. I know, because I have just paid 36€ so my wife can sit next to me in business class. Let me repeat that BUSINESS CLASS. BA does offer free seat selection at check-in, depending on availability, but if you want a guarantee, you pay.

BA charges for pre-selected seats and does not include this in the headline price – Is BA’s seat allocation charge deceptive advertising?

Choosing a random date on U2 in November, for MLA-LGW, the initial ticket price was 52.99€ and the admin fee (which is what it says) was declared at 11.99€.

The final price, including admin fee, appears in a box on the right hand side of the same webpage, as soon as one selects the preferred flight, hardly a deceptive practice.

If I go hand luggage only, don’t care about my seat or priority boarding and don’t have sports equipment, then I pay 52.99€ and 11.99€, if settling by debit card.

I see nothing deceptive here, it is transparent and easy to follow. I also, personally, prefer unbundled pricing, as I can choose my service level.

I agree that charging you for printing your own boarding pass or charging 60€ at the airport is not great…. but wait, easyJet don’t do that, do they? You can still get a boarding pass at the airport, for free – I do every time I use them from Malta.

[SimonS1]

Interesting Anthony. I have just priced up a day trip from LGW to GLA on 16th December. Early flight out, late afternoon back.

Easyjet £69.93, BA £122.88.

Both offered to sell me seat reservations – Easyjet started at £3, BA £5. PS Easyjet specifically says if not purchased seats will “allocated free if charge when you check in” so what you state above is incorrect.

BA includes 23kg of baggage, not required as I only have a briefcase.

BA also includes whatever catering is offered these days, but then again £53 extra is quite expensive for an airline breakfast and I normally get something in the airport.

From what I know Easyjet equipment will be a relatively new A319, BA an antique 737.

Still, you pay your money and take your choice.

[AnthonyDunn]

@ FormerlyDoS – 21/11/2012 20:24 GMT
“You are wrong in stating that passengers (on a standard ticket) will have to pay for seats from November, only if they wish to select a specific seat, otherwise they can accept what U2 gives them at no cost”.

@ SimonS1 – 21/11/2012 21:48 GMT
“Both offered to sell me seat reservations – Easyjet started at £3, BA £5. PS Easyjet specifically says if not purchased seats will “allocated free if charge when you check in” so what you state above is incorrect”.

Having read the EJ website item about pre-allocated seating from the end of November, I assumed (because I did not see anything either way) that getting the seat you wanted would come at an additional price. If that’s not the case, then I accept I was wrong.

As I am not here as a BA representative – rather I am one who advocates flying on UK carriers rather than foreign competitors – I am sure that there are any number of occasions when BA fares are less than EJ and vice versa. But that’s the beauty of competition: you pays your money and makes your choice.

Beyond that, where we tend to disagree is over what a headline fare is and what it is not. It is not a figment of my imagination that the Consumers Association made a super-complaint to the OFT which lead to the latter’s report (published earlier this year?) about the on-line pricing practices of airlines. This specifically addressed the practice of quoting a headline fare which subsequently became another thing entirely once the options/add-ons/standard items (depending upon your definition) are factored into the equation.

Not being a lawyer, I don’t believe that anything I have posted above comes anywhere near being construed as libellous: adj. Involving or constituting a libel; defamatory; (used of statements) harmful and often untrue; tending to discredit or malign.

[FormerlyDoS]

Anthony

Believe it or not, I was trying to be helpful in suggesting you edit your post, not attacking you.

I’m not a lawyer either, but I wouldn’t wish to see anyone get sued for an internet post, especially with recent actions from Lord McAlpine fresh in my mind.

My concern that was by using the word deceptive, you were implying that easyJet were deliberately using sharp practices and that this could be defamatory.

You are right about the OFT report, but a number of airlines, including U2 changed their practices following it

http://www.oft.gov.uk/news-and-updates/press/2012/58-12

Anyway, safe travels and all the best.

[AnthonyDunn]

@ FormerlyDoS – 22/11/2012 00:43 GMT

I think that I may (a) have got the wrong end of the stick on this one and (b) reacted unnecessarily waspishly. Sorry and thanks for your comment.

Thinking back to the OFT report, I recall the criticisms and then sundry airlines ostensibly “amending” some charges but in other respects essentially leaving the basic practice unaltered. It is my contention that EJ have rather followed this approach.

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