Posted on Monday 22 November 2010 byUlster Business
This month marks 15 years since easyJet's first flight. Ulster Business talked to UK regional general manager Paul Simmons about the company's growth and Belfast's key place within its network
It might surprise some people but easyJet is now comfortably the UK's largest airline, with expectations that it will fly around 50 million passengers this year.
Such a statistic seemed unlikely when the airline's first flight from Luton to Glasgow took off on November 10, 1995.
But in the intervening years easyJet has helped change the face of air travel, its business model becoming a benchmark for low cost carriers around the world and the orange and white livery of its brand is now firmly embedded in the public consciousness.
"In passenger terms we are going to be carrying more people than BA and Virgin combined, or if you prefer BA and bmi combined. In many ways easyJet has turned from being the challenger brand to the incumbent," says Paul Simmons, the airline's UK regional general manager.
In the job for around two years, Mr Simmons has responsibility for easyJet's 10 UK bases and a market that accounts for around half of easyJet's company-wide sales.
On his arrival into George Best Belfast City Airport – to which easyJet switched its London Luton service last year – Mr Simmons highlights that Belfast is one of the airline's longest standing bases, with the first flight from Belfast International to Luton taking place in September 1998.
The company now has 190 employees in Northern Ireland, serves 21 destinations from Belfast and accounts for a third of all air transportation from the province, with annual passenger numbers of almost 2.5 million – an average of nearly 7,000 a day.
"Belfast is key to easyJet's network, and very close to our hearts. It is a core part of easyJet's business," he says.
"It is a tough market, you have to give people what they want, you have to have the right products and the right prices. You also have to be committed enough and I think over the years we've shown we are doing those things, which is why we are still here and serving 21 markets from Northern Ireland. We are Northern Ireland's favourite airline in terms of the number of passengers flown every year and we are very proud of that."
That commitment has been reiterated by easyJet's decision to up the frequency of its Belfast to Liverpool service from four to seven daily flights, and the planned launch of a new twice weekly flight to Malta – a route that has performed well from other locations.
It will also this month add a third daily flight from City Airport to Luton, although Mr Simmons says this should not be taken as an indication the route will remain there permanently.
"We said at the time we started the City route that we wanted to see if passengers preferred coming to City rather than International. To be honest the jury is still out on that one. Yes we are increasing from two to three flights because in terms of load factor we are doing well. But we're surveying customers and there is no clear preference emerging on the customer side for one or the other," he says.
Though in the longer term easyJet is expected to choose between the airports, he notes that it is not unknown for it to fly to two airports in some cities, for example Rome, Milan and Paris.
One thing that won't be a determining factor in its choice is the length of the runway at City Airport, the cause of a long running planning dispute and opposition from some in the local community.
"Our position is that it was always an issue for the local community and the government in Northern Ireland. We made our point during the process that we were not asking for a runway extension; we didn't need it for operational reasons. As a business we made our position known and then left it at that," explains Mr Simmons.
While he doesn't rule out moves to cash in on Ryanair's exit from City airport because of the dispute, the easyJet boss says routes previously operated by its rival such as Belfast-Stansted are already well served by easyJet from the International.
"We said at the time that Ryanair pulled out that we would be looking at our options and talking to both airports, which we're still doing. But to manage expectations we already have our summer schedule on sale. As an airline you plan where your assets are and what they are going to be doing every minute of the day, and we are planned out until October next year, so to move that around would be quite difficult," he adds.
"It's not to say that we won't make changes but one of the things we like to do is give people some reliability. We give people lots of notice if we make any changes.
In their early days most low fare airlines were lumped in the same category, but Mr Simmons – formerly head of brand marketing for easyJet – believes there is now a much clearer public perception that easyJet puts more focus on the customer experience than some of its rivals.
"We actually poll 10,000 passengers a month, every month. We ask questions about everything through the passenger journey from booking right through to collecting your bag. We know where the pinch points are, where the issues are, and if we spot something we can act on it," he says.
"A few months ago for example our passengers were telling us that security at Liverpool wasn't great. We went up and worked with the airport, who were going through a change programme from one security system to another. We worked with them to see what they could do about it and helped to make the passenger experience better."
He also cites easyJet's response to the volcanic ash cloud disruption, which closed UK airspace for two weeks in April, as another example of its increased desire to keep customers happy. The airline put up 100,000 people in hotel rooms which it paid for up front, trebled its call centre staff throughout the period and was the first carrier to settle all claims for those who made their own arrangements.
The ash cloud cost easyJet an estimated £60m, but Mr Simmons is confident that should a similar situation occur there would be less disruption.
"One of the things that caught everyone by surprise was that the engine manufacturers didn't have any data about what percentage of ash cloud you could fly through. The volcano went off and you had a certain number of parts per million that were ash, but it took that whole two week period for the engine manufacturers and airlines flying through it to see what was safe to get it certified for insurance companies to say it was safe to fly. If anything happened again at least we would have some data and the tolerance levels would be higher. You wouldn't see the complete shut down of the skies that we saw last time."
Mr Simmons says easyJet is committed to safety, noting that the airline's fleet is upgraded on an ongoing basis and that it receives a new plane from Airbus on average every two-and-a- half-to-three-weeks.
That also helps boost its environmental credentials and has led easyJet to call on governments to take a tougher stance on emissions regulation against rivals who are still operating 15-20 year old aircraft.
"One thing we try to do is to make sure the CO₂ impact per passenger is as low as it can be. We fly new planes with modern efficient engines and we have high load factors. The combination of those factors means we fly an equivalent plane versus BA at a 27% lower CO₂ per passenger per kilometre mile than they would," the easyJet executive adds.
The airline has voiced its concerns about the recent rise in Air Passenger Duty (APD) particularly as the travelling public will continue to subsidise private jets – who don't pay tax. The rise, to £12 on flights within Europe, means the tax will have increased by 140% since 2007. The UK Government have made a reform of APD from a poll tax on passengers into a fairer and greener per plane tax a firm manifesto commitment, which is also included in the Government's coalition agreement.
"The travelling public can no longer afford to subsidise fat cats in private jets. The Government needs to press forward with its plans to reform APD. They need to ensure that everyone pays their fair share. APD is already higher in the UK than anywhere else in Europe, and Northern Ireland passengers would be better off if the tax was shifted from per person to a per plane tax," says Mr Simmons.
After a pick up in passenger traffic the easyJet group recently increased profit expectations for its latest financial year to "slightly ahead" of £150m, which was the top end of its previous forecast of £100m to £150m. Mr Simmons puts that performance down to both what the airline offers and a shift in what customers want.
"Last year we were one of only four or five airlines in the world to make a profit – it wasn't a big one but we did make a profit. This year we're moved on further," he says.
"Economic conditions are tough. However, the appeal of what we do, which is essentially to offer low fares in a way that recognises the customer as an individual who should be treated with courtesy and respect, is helping us to win and retain passengers."
"One thing we do find in market research, is that some people who have maybe flown traditional carriers aren't sure of easyJet until they have flown easyJet. Once they fly with easyJet they are more than comfortable flying with us again. So we are focused on getting people over that first flight, particularly in the business area."
Currently the business traveller segment is around 20% of its overall revenues, though this varies by destination and is much higher on routes such as Belfast to London.
To widen its appeal easyJet has broken from its traditional low-cost booking channel to make its flights available through business travel agents for the first time. It has also added services such as speedy boarding plus, flexible booking, free changes to earlier flights and access to airport lounges to its offering, and is welcoming suggestions for new routes from Chambers of Commerce and large companies.
Mr Simmons adds: "We are also looking to grow our route map by pushing further east and further south. We are limited by how far you can fly an Airbus 319 and 320, which is about six hours, but we have been pushing into places like North Africa and Egypt. There's still very much scope for it to grow."