It is thought a breakthrough in the UK’s ongoing political deadlock could help unlock “pent-up demand” which is failing to translate into sales as Britain’s exit from the EU lingers.
That outlook was reinforced this week after easyJet revealed it expected to post a first-half pre-tax loss of about £275 million, amid “unanswered questions” around the UK’s exit strategy.
In a trading and pre-close statement on Monday (April 1), chief executive Johan Lundgren said stalling talks in Westminster, along with “macroeconomic uncertainty” were driving “weaker customer demand”, likely to now impact its second-half results.
An industry financial commentator, who did not wish to be named, said: “Am I confident about this summer? Not as it stands.
"I think we’re looking at a much later booking market than we’ve seen in recent years – and it could expand much further than we are used to.
“Prices are soft but no one is rushing to buy. There is pent-up demand, but Brexit is continuing to cast a shadow.”
He added his belief that the longer the UK stays in the EU “with things finally getting resolved”, the more confidence will come back and “help unlock the demand”.
Alan Bowen, legal advisor to the Association of Atol Companies, said the current market was “clearly very tough for short- haul business”.
“EasyJet has said that demand is soft and it’s going to stay soft as long as we’re obsessed and frightened about what’s going to happen and if we’re going to be thrown out of the EU next week.”
MPs voted on four alternatives to the prime minister’s EU withdrawal deal on Monday (April 1) with none gaining a majority.
Following a seven-hour cabinet meeting on Tuesday (April 2), Theresa May has offered to sit down with leader of the opposition Jeremy Corbyn to try to hammer out a deal to break the Brexit deadlock.
Bowen, though, predicted a “bookings boom” if a decision was reached to push Brexit back to 2020.
What’s your view? Email email@example.com and let us know your thoughts or leave a comment below.