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Friday, 5 October, 2001, 16:54 GMT 17:54 UK
Easyjet weathers storm
Easyjet Boeing 737 300
Easyjet is Europe's second biggest budget carrier
Budget airline Easyjet has managed to dodge the global slump in air travel following the terror attacks on the United States. During September passenger numbers were down just 3% compared to a month earlier.

And on the year, traffic was actually up 27% as the carrier added extra routes and flights to its schedule.

The news comes as British Airways announces plans to merge two regional airlines with the loss of 200 jobs.

The move takes total job cuts in recent weeks at Europe's largest airline to 7,200.

Earlier this week, BA said it had lost one in three of its transatlantic passengers since the attacks, and forecast traffic this month down 25-30% on October last year.

By comparison, passenger numbers at Easyjet and budget rival Ryanair appear to be holding up. With no exposure to the transatlantic market, the airlines have managed avoid the troubles besetting the bigger carriers.

The discount airlines have responded to the crisis in the air industry by slashing fares in an attempt to stimulate demand for their short-haul flights in Europe.

They have also opposed any government aid to prop up the traditional airlines.

Easyjet shares closed up 14p at 349p on Friday.

Internet sales

The budget airline said it carried 680,383 passengers in September, compared to 534,913 passengers during the same month a year earlier.

It said it had recorded a 27% increase in traffic compared to September 2000.

Some 91% of Easyjet's September sales were made over the internet, up from 77.8% last year.

Easyjet operates 35 routes to 16 destinations in Europe.

The budget carrier said last week that its full-year profit would be in line with expectations.

It said booking levels were back to normal after dipping in the immediate aftermath of the attacks on the US.

BA restructuring

BA said it plans to fold its British Airways Regional unit into CitiExpress to create a single regional airline for its short-haul domestic and European network.

It also announced cuts to services, including suspending flights between Newcastle and Oslo.

In a statement BA said: "This move is imperative to protect the future of our operations in the UK regions and will ensure that our routes can become viable by achieving a better balance between capacity and demand."

The combined turnover of the regional business would be more than 600m, with a fleet of 92 aircraft serving over 120 routes and employing 3,200 people.

Dividend axed

The carrier also revealed that directors on Friday had decided that, because of the "difficult" trading conditions, BA would not pay a half year dividend to shareholders.

"Unless market and trading circumstances improve materially in the coming months it is unlikely that a final dividend will be paid," the carrier added.

The news helped renew a decline in BA shares, which ended 6.3% down at 155p.

Meanwhile, London City Airport said its passenger numbers last month totalled 116,327 - a 19% dip on the September 2000 figure.

But airport managing director Richard Gooding said all routes were being operated and it was still expected that flights to three new routes - Munich, Hamburg and Dortmund - would start over the next six weeks.

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 ON THIS STORY
The BBC's Simon Montague
"The profits for airlines like Easyjet depend on low costs"
See also:

03 Oct 01 | Business
Passengers desert British airlines
04 Oct 01 | UK
Fare discounts take off
21 Sep 01 | Business
Budget airlines cut fares
21 Aug 01 | Business
Easyjet founder enters banking
07 Aug 01 | Business
Ryanair profits soar to new heights
13 Aug 01 | Business
Tony Blair drops Easyjet
18 Sep 01 | Business
UK airlines call for state aid
19 Sep 01 | Business
US airlines lose 40,000 more jobs
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