Airneth Conference The Hague · Development of intra-European air travel 59% 59% 56% 50% 23% 21%...
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Airneth Conference The Hague 16 April 2009 Cor Vrieswijk
Transcript of Airneth Conference The Hague · Development of intra-European air travel 59% 59% 56% 50% 23% 21%...
Airneth Conference The Hague
16 April 2009
Cor Vrieswijk
Agenda
1. Intro easyJet
2. Innovating the seamless airport
3. easyJet in The Netherlands
easyJet – painting Europe Orange
0.0
10.0
20.0
30.0
40.0
50.0
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 20080%
10%
20%
30%
40%
50%
Passengers Proportion Non UK Originating
millions
Europe’s 4th largest airline 7% share (OAG) 44 million passengers (FY08) 175 aircraft situated in 19 bases
Pan European network 418 routes, 110 airports,
27 countries Increasing geographic diversity
51% of passengers originate outside UK
Third of flying does not touch the UK
300 Mln Europeans live less than 1 hour from easyJet served airport
Over 1000 flights with 120.000 pax a day
110 network points
Low cost, financially strong and highly efficient
Focused, simple operation New fuel efficient fleet - average age 3.5
years Low ownership costs – Airbus contract High asset utilisation
aircraft in operation 11.6 hours a day * Average turn time of c.30 minutes
Strong cost reduction momentum Cost per seat ex fuel reduced by 13% over the
past 3 years Financial strength
Low gearing 29% Strong cash position c.£863mln Agreed facilities of $1.25bn at attractive rates
Europe’s No 1 Air transport network
Source: OAG May08Presence on top 100 routes (market pairs)
2919
8
21 20 17 18 16 14
7
18
45
40
35
3025
1510
50
2036
29
19
8
21 2017 18 16 14
3
7
18
Non primary airportsNumber of market pairsOperated between 2primary airports
1
easyJet is present in 40 of the top 50 airports
2008 Intra EU Capacity - Top 50 Airports (cover 88% of all capacity)
0
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000M
AD
CD
GLH
RFR
AFC
OM
UC
BC
NA
MS
LGW
OR
YS
TN
DU
BO
SL
CP
HP
MI
ZR
HIS
TV
IEA
RN
DU
SM
XP
BR
UA
TH
TX
LM
AN
HA
MH
EL
LIS
AG
PG
VA
PR
GLI
NN
CE
ST
RC
GN
LTN
ED
IA
LCW
AW
BH
XLP
ALY
SB
UD
VC
EG
LAV
LCB
GY
MR
SC
TA
BG
O
Top 50 airports cover 88% of intra European capacity
Source: OAG May08
added since May 2008
Agenda
1. Intro easyJet
2. Innovating the seamless airport
3. easyJet in The Netherlands
The “dinosaur” world of aviation
“Dinosaur” Airports
AirportExperience
Vested Interests
of Suppliers
Lethargy to Change
Cost base of CUTE desktops
AirportHardware
Approachto IT
Systems
The world is changing…
easyJet Vision
Mobile
User Expectation
SelfService
Advances in
Hardware
WirelessComms
11
Low cost, with care and convenience!
• WiFi / 3G internet based connectivity• Low Cost• Quick and simple to deploy and withdraw• Resilient and reliable
• Standard PC based commodity hardware• Low cost (procurement and maintenance)• Wide range of mobile devices (PDA, Tablet, etc)• Standard receipt printer (mobile, belt mounted)• Independent of CUTE
• Mobile• Payment solution across the airport• Reduced airport ‘real estate’ requirement• Queue busting• Disruption Management• Sales tools – culture change opportunity
• Passenger empowerment• Self-transfer• 100% internet check in• Lost baggage tracing
Ideal customer journey… customer service kiosks
What do we see Passenger Empowered Sales Desk Kiosks doing:– Purchasing a ticket– Changing a missed flight or refunding a cancelled flight – Kiosk check-in – at a fee– Paying for additional bags or excess weight– Buying speedy boarding– Reporting luggage missing
easyJet will replace traditional sales desks with multi-lingual customer service kiosks, potentially with a phone link to our customer call centre
easyJet proposes radical new approach to airport charges
• Pay for airport services used only to encourage efficient use of infrastructure
– Bag drop point – choice of flat rate seasonal rental or per minute
– Baggage handling; charge per bag
– Security charges – real costs per passenger
– Stand / Gate – time related charge
– Other overheads – per passenger
• Differentiated infrastructure resulting in differentiated charging (MXP, BRX, CPH)
• Pilots with champion airports will start end of year
Efficient airlines should not subsidise other airport users
Agenda
1. Intro easyJet
2. Innovating the seamless airport
3. easyJet in The Netherlands
Development of intra-European air travel
59% 59% 56%50%
23% 21%15%
12%
18% 20%29%
38%
0%
20%
40%
60%
80%
100%
2004 2005 2010e 2015e
Mar
ket s
hare
(% o
f pas
seng
ers)
Mainline carriers Charter airlines Low fares airlines
Low fares airlines are a significant and growing market segment
Source: Mercer, Hapag-Lloyd, Air Berlin, McKinsey, Global Research (HVB) (2007)
Note: The European Low Fares Airline Association (ELFAA) report on ‘Social Benefits of Low Fares Airlines in Europe’ published 2007 suggests the low cost sector could account for as much as 43% all intra-European point-to-point scheduled passengers by 2011
Significant scope to develop the easyJet network from Amsterdam
Development Milan Malpensa
• easyJet base since 2006• 15 aircraft based (2 to follow)• Flying to Malpensa from most markets• 8.5 mln passengers in dedicated terminal
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
LON
PAR
BC
N
MIL
MA
D
BSL
CPH FR
A
LPL
EMA
OSL
MU
C
RO
M
VIE
STO
GVA
BR
S
PRG
IST
DU
B
EDI
LIS
NC
L
HEL
BER
NC
E
BU
D
HA
M
WA
W
GLA
Mill
ions
Non-LCC LCC
30 largest market pairs to/from AMS – very low LCC penetration
Source: OAG data Jan-Dec 2008; easyJet market pair definitions
• Overall LCC capacity share of 19%• 9 markets with no LCC at all
– FRA, MUC, IST, DUB, NCL, BUD, HAM, WAW, GLA• 9 markets with LCC share less than 15%
– PAR, MAD, BSL, CPH, OSL, ROM, STO, LIS, HEL • 5 markets with monopoly by Air France-KLM group
– PAR, NCL, BER, NCE, GLA
AMS price evolution Passenger charges
21.14%
21.28%
Passenger Service Charges
DLP – departing local passengersDTP – departing transfer passengers
T1 (1st Nov 07) T2 (1st Nov 08) T3 (1st Apr 09)
The passenger charges applied at Schiphol between 1
Nov 07 – 31 Oct 08(T1)
The passenger charges applied at Schiphol as of 1 Nov
08(T2)
The passenger charges to be applied at Schiphol as of 1
April 09(T3)
T1 – T3 increase
DLP DTP DLP DTP DLP DTP DLP DTP
€11.87 €4.98 €13.46 €5.65 €14.38 €6.04 21.14% 21.28%
AMS price evolution Security charges
Security Charges
T1 (1st Nov 07) T2 (1st Nov 08) T3 (1st Apr 09)
The security charges applied at Schiphol between 1 Nov
07 – 31 Oct 08(T1)
The security charges applied at Schiphol as of 1 Nov 08
(T2)
The security charges to be applied at Schiphol as of 1 April 09
(T3)T1 – T3 increase
DLP DTP DLP DTP DLP DTP DLP DTP
€10.84 €6.07 €17.47 €9.78 €12.95 €7.25 19.46% 19.43%
DLP – departing local passengersDTP – departing transfer passengers
Cost at Schiphol today (departing passengers)
Even without tax, Schiphol is Europe‘s second most expensive airport!
12,95
19,76
7,56
15,20
4,45
13,62 13,13
14,38 8,76
1,39
5,47 9,06
11,25
11,55
14,55
0,00
5,00
10,00
15,00
20,00
25,00
30,00
35,00
40,00
45,00
AMS LHR CDG FRA MAD MUC ZRH
TaxSSCPSC
01/04/09
Cost at Schiphol today (transfer passengers)
Departing passengers keep subsidising transfer passengers!
7,25
19,76
4,73
9,80
4,45
10,53
5,00
6,04
7,95
1,39
5,47
6,25
0,00
14,55
0,00
5,00
10,00
15,00
20,00
25,00
AMS LHR CDG FRA MAD MUC ZRH
TaxSSCPSC
01/04/09
Conclusions
Airports • Schiphol is monopolist in The Netherlands• Increase competition by selling regional airports • Lelystad: international airport, potential of 10 mln pax• easyJet interest for Lelystad but will not leave Schiphol• Market will take care of selectivity
Airlines • Reduce dependency on one carrier • Lower costs at Schiphol to increase competitiveness • Unsustainable for efficient airlines to subsidise hub traffic
Dutch aviation needs more competition tosafeguard jobs and offer consumer choice
Thank you very much!
