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easyJet Flying High (Relatively)

Consumer Edge’s recently launched UK dataset has already proven to be very predictive for several company earnings reports.  One such company is easyJet, where a strong correlation provides confidence in Consumer Edge airline data overall.  In today’s Insight Flash, we take a deep dive into UK travel trends, digging into how low-cost players like easyJet are holding up.

The UK Travel industry lost almost all of its sales in April and May 2020, with sales down -90% y/y.  As trends recovered into the fall, Lodging was a standout for outperformance with spend down by only about half of the year before rate.  Cruises have been the worst performer, remaining depressed at a -90% y/y decline in spend through December.  Airlines have fared somewhere in between, with sales down by about three-quarters y/y in the fall, and a slight uptick to declines of only about two-thirds during holiday travel in December.

UK Travel Industry

Note: Credit card spend does not take into account rebooked travel

easyJet has been less susceptible to COVID-19 woes than the rest of the Airlines subindustry.  Its declines in y/y transaction volume weren’t as sharp as the industry overall in April and May.  And, during the summer travel season, transactions were only down -30% in July (half the decline of the industry overall) and -37% in August (two-thirds the rate of the industry overall).

easyJet Transaction Growth

Note: Credit card spend does not take into account rebooked travel

Pricing strategy may have been a tailwind for the airline.  Both British Airways and Ryanair had soaring average spend per transaction at the beginning of the pandemic in April – up 45% for British Airways and 40% for Ryanair.  Meanwhile, eayJet’s average spend per transaction was down -42%.  These lowered rates remained consistent in the subsequent months, although Ryanair did eventually change course to match the cuts.

Average Spend per Transaction

Note: Credit card spend does not take into account rebooked travel