EasyJet scrutinises capacity growth plans, mulls A320neo

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EasyJet is in the middle of a major fleet planning exercise which could result in a rescheduling of its Airbus orders, as it examines how to adjust capacity growth in the face of near-term market uncertainties.

The airline, which has just taken delivery of its 200th Airbus aircraft, is also in initial talks with Airbus and Boeing about its longer-term fleet requirements. While the new A320neo family is seen as a potentially strong contender, any discussions with Airbus are at a very early stage.

"The next 18 months is not going to be the easiest period for any airline," said EasyJet chief executive Carolyn McCall. Speaking at Airbus's headquarters in Toulouse at the 200th Airbus ceremony, McCall said that EasyJet will end its current financial year (on 30 September) with a fleet of 204 aircraft (202 Airbuses and its last two remaining Boeing 737-700s).

"When I presented our strategy last November the plan was to grow capacity at 7% [annually] but I said we had fleet flexibility that meant we could flex growth down to 2% if we needed to, or up to 10%, if we needed to."

Facing growing uncertainties, such as the rising fuel price and Eurozone debt, McCall said EasyJet is now "deploying that flexibility" planning, but declined to be specific about revised near-term growth plans as it was "all work in progress".

"We're currently in the middle of the planning for the next two-to-three years. There are various levers we can use to control this," she said, such as lease extensions or returns, or even the deferral of orders.

EasyJet announced in January orders for 15 more A320s, and while McCall said these are "currently" due for delivery between late 2013 and 2015, she cautioned that the airline is "looking at how we time those aircraft and use those to give us as much flexibility as we can. We're examining that in terms of what we're looking at over the next 18 months and seeing what we can do."

As part of its strategy for fleet roll-over, EasyJet has recently retired its first batch of Airbuses. These comprise five A319s delivered around eight years ago on operating lease, and are now withdrawn ahead of being returned to their lessors.

Meanwhile McCall said that talks have been held with both Airbus and Boeing about its longer-term fleet requirements. "We will talk to Airbus about the A320neo and how that might integrate into what we're thinking about over the next 5-10 years," said McCall, but emphasised however that the evaluation was in its "early days".