news_easyjet_1

Is easyJet’s business model outdated?

Many of you have certainly noticed easyJet’s recent misfortune. Flighstat recently published easyJet’s on time performance data, which confirmed that the airline is now in hot waters. According to the website, easyJet’s average delay reached 74 min. A performance so poor, that many passengers are asking the public government to react and are asking for a review of the airline’s methods. The problem is that easyJet is now facing the paradoxes of its business model. By this I mean it is very difficult for the airline to maintain its low costs when operating from major airports. I therefore think the main problem is the airline’s strategy. In a way, easyJet has a performant strategy through its operation of classic routes at a lower cost than national carriers. In France for example, easyJet as overtaken a large number of Air France routes as it operates out of same airports but at a lower cost. But inevitably, the more the airline develops its network of major airports, the more it becomes difficult to stay true to its low cost DNA. Indeed, major airports are not as easy to operate from than secondary ones. When you are the only player in a secondary airport, like Ryanair does, it’s very easy, as you have almost any constraints. But you decide to operate from main airports, high traffic reduces considerably your option and doesn’t provide much leeway. Then, when a little thing goes wrong, by the end of the day it’s a complete mess, and you have hundreds of passengers stranded somewhere in Europe. EasyJet’s 20 minute rotations do not match its strategy anymore, at least not if the company continues to operate out of major airports. This is also what some experts are now starting to believe.

In Switzerland, Jean-Marc Thévenaz, CEO of easyJet Switzerland, held a press conference to apologise to Swiss passengers, after several politicians asked the government to put pressure on easyJet to review its business model in order to reduce abnormal delays. Jean-Marc Thévenaz announced the upcoming arrival on an extra airplane that should reduce major delay problems.

Could lack off staff leads to discrimination?:

EasyJet’s delays is not its only problem. My point here is that easyJet, by seeking cost reducing solutions to increase profitability has put its actual staff in a position that does not allow them to care adequately for certain passengers, which may require more time and assistance. In France for example, the orange company has made headlines for its discriminatory policies regarding disabled people. In the past six months, the airline refused at least 4 disabled passengers on the basis that they were not accompanied. EasyJet explains its staff decision by strict security rules. According to the second largest European airline, it could allow disabled to fly only if they are accompanied. The fact that only easyJet construes European safety rules this way, made the French authorities decide to carry out an investigation into easyjet. The French Transport Minister declared that “EasyJet cannot hide behind security rules to refuse to let passengers with mobility difficulties on board,” and added that the company “must put in place solutions adapted to particular cases, as most companies do. Otherwise it must be sanctioned with maximum severity.

In addition, several disabled persons, who had seen they boarding refused over this very reason, decided to take a complaint to the Halde, the French anti-discrimination body. For the Disabled Association of France, EasyJet sacrificed the disabled for its profitability.

After easyJet’s social media case, it seems that easyJet continues to strongly ignore the risk of having such policies, letting disappointed passengers express they hanger all over the Web. But now, the company has to react as the problem is no longer confined to the web, Swiss and French governments are on easyJet’s case as well.

About these ads

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s