Brexit and UK outbound

It is still early days, the impact of the decline in the purchasing value fo the £ has not yet worked through, the larger companies have hedged into next year buying € & $ ahead. But unless the £ recovers, which seems very unlikely, holidays will cost more next year. For smaller companies who have not hedged a 10% decline in the value of sterling hits their margins very hard.

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First Choice, the home of all-inclusive holidays has released new research which has found almost 60% of us feel in desperate need of a break and some political respite after the nation voted to leave the EU at the end of June.

Mark Hall, Director of Product at First Choice said: “Despite the political upheaval, holidaymakers are not being put off booking their holidays.  More than ever before they want to flee the UK, spend time with their families and switch off.  All inclusive holidays are increasing in popularity as customers want peace of mind and control over their holiday budget, so they don’t have to worry about what they’re spending while away.” more

Easyjet has been widely reported to be pursuing registering an air operator’s certificate in a European country.

“easyJet is lobbying the UK government and the EU to ensure the continuation of a fully liberal and deregulated aviation market within the UK and Europe. This would mean that easyJet and all European airlines can continue to operate as they do today.
As part of easyJet’s contingency planning before the referendum we had informal discussions with a number of European aviation regulators about the establishment of an AOC (air operator certificate) in an European country to enable easyJet to fly across Europe as we do today.
easyJet has now started a formal process to acquire an AOC.
Until the outcome of the UK/EU negotiations are clearer easyJet does not need to make any other structural or operational changes.
We have no plans to move from Luton – our home for 20 years.” More in the FT

Today EasyJet shares fell 5%+ as the markets opened after the airline reported an 8.3% drop in revenue per seat for the three months ending June 30, although some of the damage was reduced by a 3.8%  improvement in cost per seat. They also reported that

“Commercial and operational performance during the quarter was impacted by the Brussels attack and Egyptair tragedy, significant disruption due to air traffic control strikes and congestion, runway closures at Gatwick airport and severe weather causing 1,221 cancellations.” More

Low Cost Holidays
The Low Cost Travel Group ceased trading on 15th July, based in Mallorca and registered with the  Balearic Islands authorities it did not have an ATOL and it was not a member of ABTA. Approximately 27,000 customers were reported to be in resort and a further 110,000 who had booked with Lowcost but have yet to travel.

Low Cost Holidays moved its base to Mallorca and lodged £1.09m with authorities in the Ballearics – enough to pay out just a few pounds (£7.78)  to each customer. More

 

 

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Harold Goodwin