The upstart low-cost carrier has become Europe’s most profitable- by offering fares under 75 cents.

In 1990, imitating Southwest Airlines, Ryanair became a “no frills” airline. Besides flying to smaller
airports, the usual cost-cutting tactics (no paper tickets, no passenger meals, no pre-arranged seating)
were employed. However, according to Ryanair, industry deregulation and the internet were also key.In
1997, EU airlines deregulation allowed Ryanair to go continental. By 2000 the company had started
online bookings- today, 94 percent of sales. The company plans to purchase up to 150 new Boeing
aircraft by 2010.

redicting that low yields will be temporary, the firm pegged Ryanair’s growth to reach the 20-25 percent
mark in fiscal 2005, and to remain there for 6-8 years. The company has “by far the lowest costs,” owns
all of its aircraft, and holds net cash of 286 million euros. Ryanair management is the “most disciplined
and focused in the industry,” according to RJA, which reminds that budget airlines currently account for
only 8 percent of Europe’s air travel market.

Ryanair’s prime low-budget competitor, easyJet, claims to be Europe’s leading “no frills” airline.
It doesn’t mention Ryanair, which claims 70 percent lower fares than easyJet.

The Greek-owned airline, which operates 106 routes compared to Ryanair’s 125, offers
misleading statistics. According to “Ireland On-Line,” a 75 percent increase in passengers carried
in July (1.9 million) owes to the company’s takeover of Go, a former BA subsidiary. Taking
figures for both companies together, “…the rise was a more modest 9 percent.”

There are other competitors. Ireland’s state-owned Aer Lingus, “…is being radically restructured
in order to ensure its survival” against Ryanair, according to the “Financial Times.” It plans to
renew its short-haul fleet with up to 27 new planes from Boeing or Airbus.

Aer Lingus’s first-half 2003 operating profit of 14.3 million euros shine compared to 2002
operating losses of 12.6 million euros. 2003 should see a 75 million euro profit- increasing from
64 million euros last year.

The European Union is investigating Ryanair’s activities at Charleroi Airport in Brussels,

claiming it received illegal state subsidies. A French court recently announced a similar
investigation of Ryanair’s relationship with Strasbourg Airport.

O’Leary deemed this “ludicrous,” considering that Air France has withdrawn 10 international
services since 1996, “…one of which was the London route.” He blamed high-cost airlines in
their “death-throes” for lobbying politicians against Ryanair.

According to O’Leary, Ryanair will leave both airports rather than pay higher landing fees or
legal costs. However, a recent analysis from the “Times” of London, citing Civil Aviation
Authority figures, offered another interpretation: “…since a peak last August, passenger numbers
(at Charleroi) have plummeted 41 percent and, despite withdrawing some aircraft, the crucial
load factor is down 29 percent.”
http://www.balkanalysis.com/2003/08/19/analysis-ryanair-focuses-on-the-future/

Johnson, et al, (2005: 246) define “[A] low-price strategy seeks to achieve a lower price than competitors
whilst trying to maintain similar perceived product or service benefits to those offered by competitors..

EasyJet has a policy of “No comply, no fly”. Safe, in some extend, means efficiency, means low cost. I
believe this is an important part of easyJet’s business model.

along with the increasing passengers, there are more profit could be earned in the future. So that can
make investors still earn profit. That means the easyJet can still be invested. The easyJet could pay
attention to make the passengers keep increasing and keep the cost staying in a low level.

Then, easyJet could cooperate with other easy businesses. For instance, easyCar could offer deals
on transport to and parking at airports, easyFinance can offer zero per cent interest loans for
flights. These kinds of thing not only help easyJet, but also could increase other easy businesses’
treads.
 
Next, easyJet could look to increase the number of routes and countries that they fly to. EasyJet
has 118 routes at the end of September 2004 that means they have lots of routes and countries
need to develop, there are many new chances for easyJet in nowadays.
 
Fourthly, for providing connections with easyJet’s flights, they could build alliances with
transatlantic operators. Build better relationship with more transatlantic operators could help
easyJet to create more new routes.
  
Last but not least, as the number of low cost carriers is growing it could be beneficial for easyJet
to adopt some kind of loyalty scheme, such as create a member card or loyalty card, if a
customer is a loyalty customer and with a member card, easyJet could give him or her some
discount when they buy the air tickets. For example, if their sail distance achieves 1000 miles,
they can get a free trip ticket. (http://stirmedia.bokee.com/1415635.html)

is for this reason that easyJet has today published its Environmental Code, which contains three
promises – that easyJet will be efficient in the air, efficient on the ground and will help shape a
greener future for the industry.

“The same business model which gives us low fares (new aircraft, high occupancy rates, direct
flights) also gives us environmental efficiency in the skies – easyJet emits 27% fewer greenhouse
gasses per passenger kilometre than a traditional airline on an identical route. In addition we
recognise that we can and we will expect more of our ground suppliers at airports.
“We also intend to play a leading role in improving the future environmental performance of our
industry - reforming Europe’s famously-inefficient air traffic system, implementing a meaningful
European emissions trading scheme, working on the next generation of aircraft, giving customers
the most comprehensive range of environmental information available for travel to a particular
destination, and helping them to offset the carbon emissions of their flight.
 In the quarter disruption from ATC strike action and severe weather cost £6 million and £18 million
respectively and in addition led to lost contribution of £7 million. easyJet is working to recover a
significant proportion of this through additional costs savings and revenue opportunities

easyJet’s position continued to strengthen with market share gains across Europe particularly London
Gatwick, Paris Orly and CDG and Geneva

easyJet will always support its passengers when external events impact their journey but we call on
governments to provide sensible legislation for airport regulation and air traffic control. The severe snow
disruption of the past two years also highlights the need for airports to invest in the appropriate
infrastructure to keep passengers moving.“
Strong capacity growth in Europe naturally led to some yield dilution as easyJet continues to build its
business in Europe. Capacity grew significantly in France (+32%), Germany (+12%), Italy (+13%) and
Switzerland (+26%). easyJet is now a significant carrier in many of it European markets for example
offering 50 routes out of Paris and in October was the first airline to move into Copenhagen’s new low
cost terminal

Following the difficulties of last summer On Time Performance (OTP) has been a key focus for easyJet during Q1
and we are beginning to see improvements, particularly in first wave OTP, and expect to see continued
improvement over the coming months. However during the quarter the network experienced significant
disruption, as for 30 consecutive days at least one of easyJet’s airports was closed and as consequence over 3,500
sectors were cancelled. We saw unprecedented snow in the final month of the quarter with a number of major
airports in the UK and continental Europe closed across the network. French ATC strikes and the wildcat Spanish
ATC strikes also placed pressure on the network as flights were diverted or turned round due to air space closure.
Each of these events created a challenge to operational performance particularly in December and thus whilst OTP
was in line with our target for arrivals within 15 minutes in October and November, the performance in December
meant that easyJet achieved only 65% OTP across the quarter.

The current market price of jet fuel is $897 a metric tonne compared to $681 a metric tonne a year ago and
therefore at current jet prices and dollar rates 3 fuel costs are anticipated to be around £1.17 a seat higher than in
the first half of last year and consequently the usual first half loss is anticipated to be between £140 million and
£160 million, compared to a pre-tax loss of £78.7 million in the same period last year.

The economic outlook in Europe remains uncertain and the higher market price of fuel will inevitably put pressure
on margins in the short term however the strength of the easyJet network combined with its proposition of
offering consumers the best value fares to convenient airports combined with friendly service means that easyJet
is well positioned.

easyJet’s advantaged network and improved

consumer demand has driven strong revenue
performance
Total revenue per seat up 5.1% reported, +3.3% at constant
currency
Seats flown grew by 6.0%, with a 15.9% increase in mainland
Europe
Market share has grown from 6.5% to 7.6% over the last year
Firstly these have more competitive access and handling costs
but also provide a higher rate of on-time departures, fewer terminal delays and faster
turnaround times (it is much quicker to land, unload and reload passengers and luggage
and take off again at smaller less congested airports then at a major airport such as
Zaventem or Heathrow which have to accommodate many planes at the same time). The
fast turnaround is a key element in Ryanair’s efforts to maximize aircraft utilization.
Ryanair’s average turnaround time for the fiscal year ended March 31, 2003 was
approximately 25 minutes.
Management believes that Ryanair's operating costs are among the
lowest of any European scheduled passenger airline. There are four main expenses which
Ryanair is able to control and/or reduce and therefore works hard to do so: (i) aircraft
equipment costs; (ii) personnel expenses; (iii) customer service costs; and (iv) airport
access and handling costs:
(i) Aircraft Equipment Costs: Ryanair's initial strategy for controlling aircraft
acquisition costs was to purchase used aircraft of a single type, however this no longer
became viable.
II Personnel Expenses: Ryanair endeavours to control its labour costs by continually
improving the productivity of its already highly-productive work force. Remuneration for
employees emphasizes productivity-based pay incentives, including commissions for onboard
sales of products for flight attendants and payments based on the number of hours
or sectors flown by pilots and cabin crew personnel within limits set by industry
standards or regulations fixing maximum working hours, as well as participation in
Ryanair's valuable stock option programs

iii) Customer Service Costs: Ryanair has entered into agreements on competitive
terms with third party contractors at certain airports for passenger and aircraft handling,
ticketing and other services that management believes can be more cost efficiently
provided by third parties.

(iv) Airport Access Fees: Ryanair attempts to control airport access and service
charges by focusing on airports that offer competitive cost terms. Management believes
that Ryanair's record of delivering a consistently high volume of passenger traffic growth
at many of these airports has allowed it to negotiate favourable contracts with such
airports for access to their facilities

Ryanair has the purest form of low cost airline in Europe. Ryanair boasts many No.1’s:
No.1 for passenger traffic- over 23m for 2004 - overtaking Easyjet.
No.1 for passenger growth- 50% + this year
No.1 for European routes (149) and bases (11)
No.1 for customer service delivery- punctuality, flight completion and fewest lost baggage

Ryanair must seek other ways to expand

in order to sustain their top performance. In order to do this several options must be taken into
account. The options Ryanair have are as follows:

Expand into North Africa

Routes to North Africa are also very popular for both tourists and North Africans who have
immigrated to Europe. SN Airlines currently dominates the traffic from Brussels to North
Africa but they are neither a low-cost airline nor a traditional carrier. By offering truly lowcost
flights to these destinations Ryanair could easily capture this market share. Our aim is to
seek out and start negotiations with potential airports in these countries.
Customer Service Overhaul
Ryanair has had a remarkable track record for its ‘tangible’ customer service (punctuality,
flight completion etc) however the perception of the ‘softer’ side of its customer service has
not always been good with much bad press. With this in mind Ryanair, while maintaining its
strict rules and regulations, must make an adjustment in this area.
Increased profitability has seen our cash in hand rise by _535m to _2.8bn, and we have one of the
strongest balance sheets in the industry. During the year we terminated negotiations on a 200 aircraft order
with Boeing, and we do not anticipate any new orders in the foreseeable future. As a result, capital expenditure
will fall substantially over the next 3 years. Subject to profitability, this will generate up to _1bn in surplus
cash by the end of FY13. The Board proposes to return _500m of this cash by way of a dividend in October
2010, subject to AGM approval on September 22, 2010. We anticipate that there may be a further _500m
available for return to shareholders, either via a share buy back, or perhaps another dividend by the end of
FY13. Any such distributions will be subject to the continuing profitability of the business, and no new aircraft
orders or other significant capital expenditure in the interim.

traffic last year grew 14% to 66.5m passengers. The key to this growth was Ryanair’s determination
to drive down air fares, and the cost of flying for consumers all over Europe. Average fares fell by 13% to just
_35 (a figure which includes our optional checked in baggage fees) which proves that even during a recession,
consumers can still save hundreds of millions of euro by flying with Ryanair. As well as being Europe’s
lowest fare airline, Ryanair uniquely guarantees “no fuel surcharges” regardless of how high oil prices rise,
while many of our flag carrier competitors continue to levy unjustified fuel surcharges. This means that more
and more are switching to Ryanair for our lower fares and better punctuality

We have continued to promote our popular web

check-in service and we are incentivising passengers to travel with up to 10kgs of carry-on baggage free of
charge, while increasing the cost of checked in bags. Many Ryanair flights now operate with less than 25% of
passengers carrying checked in bags, compared to 80% of passengers two years ago. This means that we are
reducing airport/passenger handling costs, while passengers are wasting far less time at airports by avoiding
check-in queues on departure or waiting for baggage carousels on arrival.

Ryanair’s
success is not due to price alone. In addition to the lowest fares in every market, we also offer:
1. The best punctuality – last year 88% of all flights arrived on-time.
2. The fewest lost bags – last year we lost less than one bag for every 2,500 passengers carried.
3. The fewest complaints – last year we received less than one complaint per 1,000 passengers carried.
4. The newest fleet – the average age of Ryanair’s 232 aircraft is now just 2.9 years.
5. Europe’s greenest, cleanest airline – independent surveys confirm that Ryanair is the best performing EU
airline in terms of emissions per passenger.
6. Prompt response to passengers – last year Ryanair replied to more than 99.9% of passenger complaints
within our committed 7 working days of receipt.

Changes in Fuel Costs and Fuel Availability Affect the Company’s Results and Increase the Likelihood
of Adverse Impact to the Company’s Profitability. Jet fuel costs are subject to wide fluctuations as a result of
many economic and political factors and events occurring throughout the world that Ryanair can neither control
nor accurately predict, including increases in demand, sudden disruptions in supply and other concerns about
global supply, as well as market speculation.

These increases had a

significant impact on Ryanair’s costs, and in turn, on its financial results – contributing to the net loss recorded
in the 2009 fiscal year, which reflected, among other things, a 59% increase in fuel costs between fiscal year
2008 and fiscal year 2009. As international prices for jet fuel are denominated in U.S. dollars, Ryanair’s fuel
costs are also subject to certain exchange rate risks. Substantial price increases, adverse exchange rates, or the
unavailability of adequate supplies, including, without limitation, any such events resulting from prolonged
hostilities in the Middle East or other oil-producing regions or the suspension of production by any significant
producer, may adversely affect Ryanair’s profitability.
As of July 19, 2010, Ryanair had entered into forward jet fuel
(jet kerosene) contracts covering approximately 90% of its estimated requirements for the fiscal year ending
March 31, 2011 at prices equivalent to approximately $730 per metric ton. In addition, as of July 19, 2010,
Ryanair had entered into forward jet fuel (jet kerosene) contracts covering approximately 90% of its estimated
requirements for the period from April 2011 to September 2011 at prices equivalent to approximately $755 per
metric ton.

The decision to freeze the Company’s development in the U.K. and reduce flights to and from London
(Stansted) has presented some risks. In the past, the Company’s growth has been largely dependent on flights to
or from the U.K. Such flights represented 24.1% of total flights in the 2010 fiscal year. A weak U.K. economy,
along with the Company’s decision to freeze growth at its U.K. bases (with the exception of launching a base at
Leeds Bradford), and reduce its London (Stansted) flights, may affect the overall growth of the Company. In
addition, the abovementioned measures affecting U.K.-based pilots may affect the Company’s labor relations.
Such risks could lead to negative effects on the Company’s financial condition and/or results of operations.

Ryanair
operates a low-fares airline. The success of its business model depends on its ability to control costs so as to
deliver low fares while at the same time earning a profit. The Company has limited control over its fuel costs
and already has comparatively low other operating costs. In periods of high fuel costs, if the Company is unable
to further reduce its other operating costs, operating profits are likely to fall. The Company cannot offer any
assurances regarding its future profitability.

Ryanair operates in a highly competitive marketplace, with a number of low-fare, traditional and charter airlines
competing throughout the route network. Airlines compete primarily with respect to fare levels, frequency and
dependability of service, name recognition, passenger amenities (such as access to frequent flyer programs), and
the availability and convenience of other passenger services. Unlike Ryanair, certain of Ryanair’s competitors
are state-owned or state-controlled flag carriers and in some cases may have greater name recognition and
resources and may have received, or may receive in the future, significant amounts of subsidies and other state
aid from their respective governments

The Company Will Incur Significant Costs Acquiring New Aircraft and Any Instability in the Credit
and Capital Markets Could Negatively Impact Ryanair’s Ability to Obtain Financing on Acceptable Terms.
Ryanair’s continued growth is dependent upon its ability to acquire additional aircraft to meet additional
capacity needs and to replace older aircraft.
Ryanair expects to have 272 aircraft in its fleet by March 31, 2011. With the Company’s current orders
for aircraft it is obligated to buy (i.e., “firm” orders) under its contracts with The Boeing Company (“Boeing”),
the Company expects to increase the size of its fleet to as many as 299 Boeing 737-800 aircraft by March 2013

The Company’s Rapid Growth May Expose It to Risks. Ryanair’s operations have grown rapidly since
it pioneered the low-fares operating model in Europe in the early 1990s. See “Item 5. Operating and Financial
Review and ProspectsHistory.” During the 2010 fiscal year, Ryanair announced 356 new routes originating
from Belgium, France, Germany, Ireland, Italy, Lithuania, Malta, Norway, Portugal, Slovakia, Spain, Sweden
and the U.K. Ryanair intends to continue to expand its fleet and add new destinations and additional flights,
which are expected to increase Ryanair’s booked passenger volumes in the 2011 fiscal year to approximately
73.5 million passengers

The key elements of Ryanair’s

long-term strategy are:
Low Fares. Ryanair’s low fares are designed to stimulate demand, particularly from fare-
conscious
leisure and business travelers who might otherwise use alternative forms of transportation
or choose not to travel
at all. Ryanair sells seats on a one-way basis, thus eliminating minimum stay requirements
from all travel on
Ryanair scheduled services. Ryanair sets fares on the basis of the demand for particular
flights and by reference
to the period remaining to the date of departure of the flight, with higher fares charged on
flights with higher
levels of demand and for bookings made nearer to the date of departure. Ryanair also
periodically runs special
promotional fare campaigns.

Customer Service. Ryanair’s strategy is to deliver the best customer service performance in
its peer
group. According to the data available from the Association of European Airlines (“AEA”)
and airlines’ own
published statistics, Ryanair has achieved better punctuality, fewer lost bags, and fewer
cancellations than its
peer group in Europe. Ryanair achieves this by focusing strongly on the execution of these
services and by
primarily operating from un-congested airports. Ryanair conducts a daily conference call
with Ryanair and
airport personnel at each of its base airports, during which the reasons for each “first
wave” flight delay and
baggage short-shipment are discussed in detail and logged to ensure that the root cause is
identified and

Ryanair’s “on time” performance record (arrivals within

15 minutes of schedule) for the 2010 fiscal year was 88%. According to the last available comparative data
published by the AEA (which relates to the 2008-2009 winter season), Ryanair’s “on time” performance record
exceeded that of its principal competitors that make such data available, including: Air France (approximately
83%); British Airways (approximately 83%); Iberia (approximately 70%) and Lufthansa (approximately 85%).
rectified. Subsequent (consequential) delays and short shipments are investigated by
Ryanair ground operations
personnel. Customer satisfaction is also measured by regular online, mystery-passenger
and employee surveys.

PUBLISH PUNCTUALITY REPORT OR PASSENGER STATISTIC TO GAIN CUSTOMER’S TRUST

BECAUSE THEY DON’T PUBLISH SINCE 27 APRIL 2009

Enhancement of Operating Results through Ancillary Services. Ryanair distributes accommodation

services and travel insurance primarily through its website. For hotel services, Ryanair has a contract with
Booking.com, pursuant to which Booking.com handles all aspects of such services marketed through Ryanair’s
website and pays a fee to Ryanair. Ryanair also has contracts with other accommodation providers that enable
Ryanair to offer camping, hostel, bed-and-breakfast, guesthouse, villa and apartment accommodation to its
customers. In addition Ryanair has a contract with the Hertz Corporation (“Hertz”), pursuant to which Hertz
handles all car rental services marketed through Ryanair’s website or telephone reservation system. Hertz pays a
per-passenger fee to Ryanair. Ryanair also sells cruises online and bus and rail tickets onboard its aircraft and
through its website.

Focused Criteria for Growth. Building on its success in the Ireland-U.K. market and its expansion of
service to continental Europe and Morocco, Ryanair intends to follow a manageable growth plan targeting
specific markets. Ryanair believes it will have opportunities for continued growth by: (i) initiating additional
routes in the EU; (ii) initiating additional routes in countries party to a European Common Aviation Agreement
with the EU that are currently served by higher-cost, higher-fare carriers; (iii) increasing the frequency of
service on its existing routes; (iv) starting new domestic routes within individual EU countries; (v) considering
acquisition opportunities that may become available in the future; (vi) connecting airports within its existing
route network (“triangulation”); (vii) establishing new bases; and (viii) initiating new routes not currently served
by any carrier.

Responding to Current Challenges. In recent periods, and with increased effect in the 2008, 2009 and
2010 fiscal years, Ryanair’s low-cost, low-fares model has faced substantial pressure due to significantly
increased fuel costs and reduced economic growth (or economic contraction) in the economies in which it
operates. The Company has aimed to meet these challenges by: (i) selectively grounding aircraft during the
2009-2010 winter season; (ii) disposing of aircraft (disposals totaled 6 in the 2008 fiscal year, 17 in the 2009
fiscal year and 3 in the 2010 fiscal year); (iii) controlling labor and other costs, including through wage freezes,
selective redundancies and the introduction of Internet check-in; and (iv) renegotiating contracts with existing
suppliers, airports and handling companies.

The Company has announced capacity reductions, primarily at Dublin Airport, the most expensive
airport in terms of airport charges that Ryanair serves. As a result of this airport’s high charges, certain routes
are not economically viable to operate during the winter when the Company typically experiences lower load
factors and fares. In June 2009, Ryanair announced that it was reducing its fleet at Dublin Airport to 17 by
summer 2009, 16 by winter 2009, 15 by summer 2010 and 12 by winter 2010 (down from 22 in summer 2008
and 20 in winter 2008), as a result of rising airport charges and the introduction of an Air Travel Tax of _10 on
all passengers departing from Irish airports on routes longer than 300 kilometers.

At that time, the company also said it expects a decline in total revenue per seat by a couple of
percentage points in the first half on a reported basis, reflecting the slowdown in bookings due to severe
weather and the poorer than expected performance of checked bags.

Political unrest in the Middle East has sent oil over $100 per barrel,” he said. “That is
significantly higher than the $84 that was the assumption in December.”

Bisignani warned that stronger revenues will only provide a “partial offset” to higher costs:
“Profits will be cut in half compared to last year and margins are a pathetic 1.4%.”

The low profit margins represent a “very thin tight rope”, he said: “The industry is performing a
balancing act... There is no buffer against shocks, so everything that hits us has the potential to
knock us over.”

Budget airline easyJet unveils volcanic ash

radar
New technology that could minimise future disruption to
planes from volcanic ash has been unveiled by budget airline
easyJet.
The carrier will be the first airline to trial a new ''weather radar for ash'' system called AVOID
(Airborne Volcanic Object Identifier and Detector).

The system involves placing infrared technology onto an aircraft to supply images to both the
pilots and an airline's flight control centre.
These images will enable pilots to see an ash cloud up to 62 miles (100 kilometres) ahead of the
aircraft and at altitudes between 5,000ft and 50,000ft.

This will allow pilots to make adjustments to the plane's flight path to avoid any ash cloud.

Millions of passengers had their travel plans wrecked when airlines had to scrap thousands of
flights in recent weeks due to the Icelandic volcanic ash problem.

While passenger numbers in the year to March increased at Ryanair by 13.6%, and at easyJet by 6.8%,
BA saw them fall by 3.9%. By contrast, the number of travellers carried by BA’s German counterpart,
Lufthansa, increased by 1.2%, despite the airline’s rumbling dispute with its pilots. Even the flight
restrictions across Europe caused by ash from an Icelandic volcano seem to have hit BA the hardest,
precipitating a 24.5% drop in passengers in April, compared with the same month a year earlier,
whereas easyJet’s fell by just 7.6%. According to the companies’ own estimates, the volcano cost BA
£180m, easyJet something up to £75m, Ryanair at least €42m (£37m) and Virgin Atlantic, BA’s domestic
long-haul rival, around £83m.

But on the issue of unbundling fares, he questions if airlines have moved too far in breaking out the
component parts of the fare. "The disaggregation has been useful as it has expanded the awareness of
the cost of these activities and asked passengers 'do you really want to pay for this'," he says. "But with
the distance between the base fare and the eventual sum, I think the pendulum has gone too far. I think
we are going to see increased customer dissatisfaction, and some of that expressed through some of the
regulatory bodies."
 160

140

120

100 Peak
Price (£)

80 Shoulder

60 Off peak

40

20

0
-150 -125 -100 -75 -50 -25 0
Days before flight
Virgin Blue chief executive Brett Godfrey says: "Those low-cost carriers with high frequencies, serving
convenient airports, offering some business essentials such as loyalty programmes, and selling through
business-friendly channels are much more likely to benefit from substitution. Our 'New World Carrier'
strategy was always aimed at making it easy for large businesses and government to substitute our
services for higher priced competition and the economic downturn looks like being the proving ground."
The key is to find where to selectively add commercial complexity and to do so in a manner that pays for
itself," says Hornick. "The opportunities may lie in areas like codesharing, baggage transfer or frequent
flyer programmes. While several carriers are seeking this opportunity, many lack the technology
platforms to take it for now.

EasyJet’s CEO, Carolyn McCall, said: “We are really pleased about the trial with the special
coating on our aircraft. Efficiency is in easyJet’s DNA. If we can find new ways of reducing the
amount of fuel used by our aircraft we can pass the benefits on to our passengers by offering
them low fares and a lower carbon footprint.

The card can be purchased via easyJetplus.com and is available from just £75. The cost of
membership gives customers a year's free Speedy Boarding. The more members fly with easyJet,
the more they benefit and customers will, on average, start saving money after only five return
trips with easyJet.

easyJet Plus is beneficial for anyone who travels regularly with easyJet, for example:

 Business passengers, who value an efficient and speedy travel experience

 Holiday homeowners looking forward to spending time home away from home
 Short break passengers who want to make the most of every minute of their trip
 Loyal supporters who don’t want to miss their team’s away games

EasyJet certainly needs a new direction. It has struggled in recent years as cost-cutting ate into
reliability (Ryanair, by contrast, has a good reputation for punctuality and keeping passengers
together with their luggage). On January 20th easyJet’s shares fell by 16% after a trading
statement forecast losses of £160m ($254m) or so in the six months to the end of March. The
listed airline has sparred with its founder and biggest shareholder, Sir Stelios Haji-Ioannou, who
thinks it has been buying too many aircraft and is losing too much money in winter.

“All airlines should be incentivised to reduce the environmental impact of their operations,
which is why we welcome the UK government’s commitment to move from Air Passenger Duty
(APD) to a fairer, greener per plane tax. We look forward to seeing the details of their proposal.”

Through a combination of a young fleet averaging less than four years old, high load factors and
operational measures such as single engine taxiing, easyJet claims its passengers are responsible
for 22% fewer emissions than those on a traditional airline. The airline has installed lighter-
weight carpets and is currently looking at fitting lighter passenger seats.

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