Originally Posted by
116d
I too think he has a point with respect to splashing out on new planes. Hardly anyone is booking (or I'm assuming that's the case - I for one am not booking anything for anywhere until things improve) and the immediate, short-term focus should be on survival...
easyJet and all other major airlines will be reviewing their fleet requirements in light of the current situation. No one knows just how long this will go on for, or what form the recovery will take. We cannot be sure that even if the economy makes a full recovery that air travel will have the same levels of demand. My personal opinion is that people have changed the way they work and work-related travel will reduce, across all modes of transport. That is not to say that demand will evaporate, but that forced working from home and reduced commuting will have shown people another way to conduct their business.
Stelios' temper tantrums are a distraction for the management right now, where survival is everything. He is doing more harm than good. easyJet are doing everything they can to conserve cash and the order will have been on their minds. Its worth remembering that they have already paid deposits for their slots and progress payments on aircraft under construction. That's money they would have to walk away from. Aircraft are not a discretionary purchase like a Bentley or a Yacht, they are absolutely fundamental to the production of product, they are a capital expense, financed over the long term. Airline fleets are planned years in advance, not days and weeks. Their old aircraft have agreements to return to lessors and onward airlines - things are not as straightforward as he is making out. It would be foolish not to have a little more information about the recovery before they make major strategic decisions which will effect the trajectory of the airline for five years or more.