Airline bosses upbeat despite vote 'turbulence'
Published 29/06/2016 | 02:30
Airline bosses sought to reassure investors yesterday, saying the industry's fundamentals remained strong and the effects on demand from Britain's vote to leave the European Union would be short-lived.
Shares in European airlines such as IAG, Ryanair, Lufthansa, Wizz Air and easyJet have tumbled since the vote in favour of "Brexit" last Thursday, but recovered some ground yesterday.
"We are going through a little bit of turbulence because of a seismic political decision," easyJet chief executive Carolyn McCall said at a meeting of industry group Airlines For Europe (A4E) in Brussels.
"The demand environment is strong. It hasn't changed because of the vote," she said, adding that pressure on pricing was mainly as a result of easyJet and low-cost rival Ryanair adding capacity to the market.
"Does anyone seriously believe people in Europe will stop flying? I don't think so," Willie Walsh, boss of British Airways parent IAG said.
He said air traffic control strikes, which A4E said cost the European economy €9.5bn over the last six years, were more problematic because they stopped the group from flying its customers to their destinations.
IAG cut its 2016 profit expectations on Friday as a result of the vote. Walsh said corporate customers had been cautious ahead of the vote and that uncertainty would mean that caution continues a bit longer.
"Our expectation was, had it been a vote to remain we would have seen demand from corporates bounce back. But ultimately, people will understand what it means and then the world will get on again, so it's short term," he told reporters. (Reuters)