Challenges faced by EasyJet

The challenges faced by EasyJet- M2

There are many challenges that have been faced by EasyJet and some are more difficult than others. They can be legal, environmental or social factors that end up challenging EasyJet economically.

The opening of the company

1995-2008

EasyJet was founded in 1995 and they only had two aircrafts. This in itself would be a challenge for Easyjet because it would mean that their supply is low in a boom period. As well as that, Demand was relatively low because although demand was high for a low budget airline, people trusted Easyjet's competition more so business would be low at first. To get past this, Easyjet had to just be patient and wait for business to get better in order to expand. This, of course, happened because now Easyjet is one of the busiest airlines in Europe.

9/11 and Iraq conflict

9/11 was a tragic terrorist attack that involved a plane getting hijacked and crashed into the world trade centre building. This was a challenge to all flight companies because for that period flights had to be cancelled and many people were afraid to fly to locations because of the terror risk. This caused a big loss to the company. This occured in 2001 but Easyjet decided to carry on selling plane tickets after the flight disruptions stopped. For the brief immediate period of 9/11, supply was low because they had to cancel the majority of their flights. However, afterwards, supply rose again because they carried on selling tickets. In 2003, there was the challenge of hostilities in Iraq because people were hesitant to travel by plane. But Easyjet, similarly to after 9/11, chose to carry on selling tickets. In this period, demand was surprisingly high so they really overcame this challenge.

2008-2010

Oil prices

Oil prices have been a challenge for EasyJet over the years because they fluctuate and can be expensive. When oil prices are high, it means that ticket prices will be more expensive which would lower demand because customers don't want to pay more and supply would be low because there would be less flights as they don't want to waste fuel. This applies both ways, for example; Easyjet have cut prices for tickets because oil prices are quite low.

Natural causes and disasters

Natural causes and disasters can cause many different challenges to EasyJet and any other business for that matter. For example a hurricane can disrupt many flights for Easyjet. These are unavoidable because they are spontaneous and natural, the only thing that EasyJet can do is to be patient and adapt and try to keep customer confidence so that demand remains high. An example of this was the volcanic ash cloud, in 2010, that grounded flights around Europe because the ash cloud made it too unsafe to fly. This meant that all Easyjet flights were cancelled which caused a low supply because no planes were allowed to fly for 8 days. Demand also became lower because it took place during the recession period and customers were also annoyed because they were stranded abroad. This is evident from the monthly flight statistics link in my bibliography. They lost 300,000 passengers for the month in comparison to the year before. In order to adapt, Easyjet responded to this issue recently by setting up an AVOID system that allows pilots to avoid volcanic ash eruptions. http://www.dailymail.co.uk/sciencetech/article-2505453/Easyjet-tests-AVOID-ash-cloud-allow-pilots-fly-volcanic-eruptions.html