The low-cost subsidiary of the Air France-KLM group has posted double-digit growth for the third consecutive year and forecasts remain optimistic for 2019. The company will increase its capacity and could open a fourth base in France. Ryanair and EasyJet are also looking for a growth driver in France in an uncertain 2019 context linked to overcapacity in certain markets, rising fuel costs and Brexit.
Good result for Transavia in 2018
The low-cost business Transavia achieved strong growth in 2018: 15.8 million passengers transported (+7.1%), revenues of €1.611 billion (+12.2%) and an operating profit of €139 million (+18%). The group plans to increase capacity by 10% in 2019 and to expand further in France with an additional base. 2 of the 3 existing bases are already saturated (Paris Orly and Nantes). In 2017, Transavia France carried 5.8 million passengers.
NEW French bases the #1 and # 2 low cost airline in Europe
Ryanair, European leader with 130 million passengers carried, announced on February 20 that it would open a 3rd base in France in Toulouse. Openings of bases in Bordeaux and Marseille are already planned. The result is the possibility of opening new lines and the hope of attracting 20% more travelers from the pink city. Easyjet, leader in France in the low-cost market with 20 million passengers, also announced a new base, its 7th, in Nantes in spring 2019. The CEO France expressed the company's interest in the French market saying that the low-cost market represents only 30% of the market in France compared to 48% in the other European countries.
Brexit and the cost of fuel in 2019
Ryanair exercises caution in other markets through its Marketing Director, Kenny Jacobs, particularly in Spain, where the company is curbing capacity growth (3.5% in 2019 compared to 10.7% in 2018) and announcing the possibility of closing certain bases. In results for 2017 - 2018, the company was already pessimistic about the uncertainty of fuel costs and Brexit. The objective for this year: to consolidate until the smaller companies, which will not be able to adapt, disappear.
Read the evaluation of risks linked to Brexit in the article "Brexit: the time bomb for airlines?"
As a reminder, Easyjet has organised itself by creating a subsidiary, Easyjet Europe based in Austria, which will enable it to operate more than half of its flights without consequences. In this Brexit context, the British low-cost Flybe was also acquired by Virgin Atlantic on February 22, 2019 with the assumed goal of operating flights from Europe to Manchester and London Heathrow airports from where Virgin Atlantic's transcontinental flights are chartered.
Rendez-vous for a snapshot of the market in May 2019 after the publication of the results of Easyjet and Ryanair...
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