Jet2.com continues to succeed with niche strategy

A NORTHERN STRATEGY

Jet2.com's new routes reflect the carrier's overall strategy of serving sunshine and city break markets from its northern UK bases. Jet2.com has based operations at the following UK airports:

Base

Weekly Seats (One-Way)

Destinations

Leeds Bradford

19,347

35

Manchester

13,445

26

Newcastle

6,141

17

Belfast

3,960

7

Blackpool

3,564

7

Edinburgh

2,640

9

East Midlands

1,971

7

Source Flightbase September 14-20, 2010

Jet2.com is focused on northern UK bases and does not operate any services South of East Midlands Airport.This has helped the carrier focus it marketing efforts on capturing traffic at its Northern bases.

The table below illustrates Jet2.com's leading five international markets. They are all typical sunshine markets and there is no surprise the two new sunshine destinations added from Newcastle are Alicante and Faro, which are currently not served.

The gap analysis shows from which UK markets and with what frequency its leading five destinations are served.

JET2.COM ORIGIN MARKET WITH WEEKLY FREQUENCY

Destination

Leeds (LBA)

Manchester

Newcastle

Belfast

Blackpool

Edinburgh

East Midlands

Murcia

7

7

5

4

3

3

-

Palma de Mallorca

7

6

4

3

5

2

-

Malaga

10

5

4

-

4

-

-

Faro

7

7

-

-

4

4

-

Alicante

10

7

-

4

-

-

TOTAL

41

32

13

7

20

11

0

Source Flightbase 14-20 September 2010

JET2. THE LEISURE CARRIER

Jet2.com does not have the same brand awareness that easyJet and Ryanair do, particularly outside of the UK, but it has developed a strong brand at its based airports and within their catchment areas.

The airline has also been able to leverage its tour operator division, Jet2 Holidays, in order to boost many of its destinations. Distribution has been packaged through the holiday company, which has been particularly successful for sunshine destinations in Greece, Turkey and Egypt - traditionally package destinations for British holidaymakers. These destinations are also very different from Spain, where the low-cost phenomenon has meant a significant downturn for the package holiday market, as passengers are used to buying airline tickets separately from their accommodation.

Jet2.com has also found a niche for itself offering capacity to tour operators and third party flying. It provides capacity on charter flights where previously carriers such as Astraeus Airlines and Titan Airways had provided such capacity. This has enabled Jet2.com to operate their aircraft throughout the Winter, improving aircraft utilisation.

THE COMPETITION

Jet2.com is under pressure from low-cost competitors at its major bases in Leeds Bradford and Manchester. Ryanair opened a base at Leeds Bradford in March 2010 and now competes with Jet2.com on nine routes. However, Jet2.com offers a number of destinations from Leeds where Ryanair does not have a significant offering and are traditional charter markets.

Jet2.com has placed its larger equipment - B757-200 aircraft - to markets in Greece, for example Corfu, Heraklion and Rhodes. It also serves Dalaman in Turkey, Paphos and Larnaca in Cyprus and Sharm el Sheikh in Egypt. Ryanair does not serve any of these destinations from Leeds. Instead, the Irish LCC serves the Greek markets from bases in Central Europe which are shorter sectors than the UK from where Greece is still predominantly a charter market. As an Irish AOC holder, Ryanair is unable to serve Turkey from the UK

Jet2.com has expanded operations at Manchester, particularly after Ryanair pulled a number of routes after it failed to agree terms with Manchester Airport in 2009. Ryanair's only route from Manchester is now to Dublin. However, easyJet competes with Jet2.com on six destinations from Manchester - Malaga, Alicante, Dalaman, Heraklion, Sharm el Sheikh and Tenerife.

The future for Jet2.com

Jet2.com will continue with its strategy to build its northern UK bases with a mixture of city break and sunshine destinations. It will also continue to utilise the strength of Jet2Holidays and will carry on supplying its aircraft for leasing. Its recent route announcements from Newcastle look set to be a success, as Prague and Krakow are popular city break markets from the UK and Toulouse has been successfully operated from Leeds and Belfast.

The traditional bucket and spade market of Alicante and Faro are becoming core Jet2.com markets and will no doubt be a success from Newcastle.

Richard Maslen

Richard Maslen has travelled across the globe to report on developments in the aviation sector as airlines and airports have continued to evolve and…