EasyJet holidays CEO Garry Wilson has warned that airfares will likely increase as fuel costs continue to rise.
Speaking at the ABTA convention in Madeira, he said there was ‘no doubt that costs coming through will put fares ups’ but said this could be mitigated by maximising load factor.
“That way the cost is divided among passengers, which keeps the cost down,” Garry added.
He also pointed to AI, with predictive technology able to model various scenarios, including fluctuating costs, to help airlines with forward planning.
Garry said: “No doubt the costs coming through are going to put fares up, it’s a case of how you manage that. One way to mitigate that is to fill your aircraft to spread the cost across more people.
“It’s just a case of understanding what customers are willing to pay, being competitive and looking at load factor.”
On the Beach CEO Shaun Morton warned customers are very price sensitive. “If it was possible to put prices up without affecting demand, everyone would be doing it. It amazes me how much demand is affected by price rises. You change the price by £20 to £25, you change the volume by 10%. Customers will find the value.”
Barrhead President Jacqueline Dobson agreed that prices increases will ‘definitely’ affect demand.
TUI UK and Ireland Managing Director Neil Swanson, who was also attending the ABTA Convention, told Travel Gossip that TUI UK guaranteed it would not offer surcharges, but he agreed that package holiday prices could increase.
Their comments came after easyJet announced winter capacity had been slashed by another 700,000 seats, taking the total reduction to 1.4 million seats.
Asked whether easyJet might trim summer 2027 capacity, Garry responded ‘maybe’, but said it would not be cut more than other years.
Chief Executive Kenton Jarvis said the airline was scaling back during quieter periods to offset rising fuel costs.
