Economics Assignment Example | Topics and Well Written Essays - 750 words

Economics - Assignment Example EasyJet has stuck to their core values, which allowed them to do well during the recession and as business pickups in the country, they will further see many improvements which will lead to even greater profits. In response to In response to the question on the fluctuating oil prices, he added that Easyjet’s hedging is a form of averaging, which means that their fuel prices respond with a lag to movement in market prices. So for 2010, they expect GBP100 million improvements as their fuel hedges adjust to market prices. Easyjet continues to grow steadily and they have expectations of 10% increase in capacity during 2010 as the passeneger numbers grew by 3 to 4 percent during the recessionary period. Easyjet remains focused on short haul a flight which proves to be working as they seem to be in line to achieve growth plans of 7 to 8 percent annually. The passenger growth easily outstripped easyJets capacity increase over the recessionary period of just 0.8%, indicating that dema nd is still matching its growth strategy despite the Europe-wide recession. Gert Zonneveld, analyst at Panmure Gordon, said easyJet had weathered the recession so far but a lengthy downturn could dampen the airlines recovery. "The company is performing well given the current economic environment, but a sustained downturn could clearly delay a profit recovery." Ryanair’s CEO Michael O’Leary commented on the tough recessionary times the airline industry was facing and he added â€Å"Ryanair’s ability to grow both traffic and profits during the half year is a testament to the strength of Ryanair’s lowest fare model, and our relentless cost discipline. However these results are heavily distorted by a 42% fall in fuel costs, which has masked a significant 17% decline in average fares.   We expect average fares to decline by up to 20% during Quarters 3 and 4, which will result in both these quarters being loss making.   Despite this our full year guidance remains unchanged and will be