The economic slow down and rising oil prices have not diminished public’s spirit for enjoying weekend holidays on low-cost airlines. EasyJet witnessed huge traffic on budget flights last month. Nearly 38 million passengers travelled by Europe’s second largest carrier last year. It reported a rise of 19.5 per cent in travellers in June to 4.1 million. The increase to some extent was due to the growing fleet and recent acquisition of GB Airways. But the main contribution came from passenger load factor which was much higher in the short-haul flight market. The load factor was 86.9 per cent in June.

Increased demand is blessing in disguise to the airline industry which is already reeling under the pressure of soaring oil prices which threaten to push the sector into a whopping loss of more than £3bn this year.
According to analyst’s estimates, EasyJet and RyanAir, currently the most profitable carriers in the world cannot continue making profit if the oil prices do not come down below the existing levels.

EasyJet’s director of communications, Toby Nicol, informs that fuel costs have gone up from £10 a passenger last year to £20 today. He feels that despite generating good revenues in next few months, airlines will not be able to cover the rising costs.

Gert Zonnefeld, analyst at stockbroker Panmure Gordon, says that load factor is the important factor in the performance of low-fare airlines. Budget carriers fly as much as possible while filling them with maximum number of passengers. He adds that EasyJet will not be able to sustain higher fuel costs once the peak summer season is over and its profits will suffer badly.