Yahoo Finance Ryanair's flight cuts are no surprise and signal an aviation nosedive
That didn’t take long. A rise in Covid-19 cases in Europe has prompted Ryanair to cut flight capacity by 20% for September and October. “Forward bookings have notably weakened over the last 10 days,” said the airline.
In truth, Ryanair’s previous intention to operate at 70% of normal capacity in September always seemed optimistic. Easyjet’s figure of 40% for the July-September quarter felt a more prudent prediction of likely demand.
In the event, last week’s imposition of quarantine restrictions for arrivals in the UK from France, Malta and the Netherlands has dashed any hopes of a late-summer holiday bonanza for short-haul operators. If punters fear more countries will be added to the quarantine list, they’re more likely to stay at home in the rain.
Related: Ryanair cancels flights on fresh UK quarantine restrictions
Business travellers traditionally fill more seats from October, but that market is also anyone’s guess. Companies are struggling to get their UK workers to come to the office, so are unlikely to insist on physical attendance at a meeting in, say, Barcelona.
The only mild consolation for the airlines is that they can trim routes in a hurry, as Ryanair is showing. It, and the likes of easyJet and Wizz Air, have the financial strength to get through the crisis. A decent test-and-trace system at airports would help, as Ryanair suggests, but only Germany and Italy seem remotely committed. The outlook for UK aviation jobs has just taken another turn for the worse.
Amazon’s UK grocery plans fail to deliver fear
Amazon’s splashy plan, unveiled earlier this month, to launch “free” grocery deliveries to members of its £79-a-year Prime service was hailed in some quarters as the start of a revolution. In one sense, it was. Tesco is developing a scheme that looks very similar.
The UK’s largest supermarket chain will soon waive delivery charges for subscribers to its £7.99-a-month Clubcard Plus setup, where the chief benefit is currently two 10% discounts, worth up to £40 a month in total, on shops done in store.
Yet the impression that the supermarkets are already dancing to Amazon’s tune looks wrong. The other way to read Tesco’s Clubcard move is that the old guard have loyalty-generating cards to play. What’s more, they start with the great advantage of massively higher online volumes and customers who also shop in physical stores.
Related: Has Amazon Fresh chosen the prime moment to take on UK supermarkets?
Underestimate Amazon at your peril, of course, but don’t forget that the US titan has barely made a dent in the UK food market after four years of fiddling. The Amazon Fresh offer is still an odd mix of Morrisons, Booths, Whole Foods, some big labels but many more specialist brands. It won’t suit everyone. Amazon has barely made it out of London so far, and the rate of the promised “national” rollout is unclear.
As things currently stand, then, there shouldn’t be too much to fear. That assessment would change overnight if Amazon took the bolder step of buying a national chain (Morrisons or Asda would be the obvious candidates). That would represent a proper revolution. Until it happens, though, expect the supermarket oldies to cope.
PwC jumps the gun in hailing WFH revolution
“There’s no question that lockdown has done away with presenteeism,” says Kevin Ellis, chairman of PricewaterhouseCoopers. “It’s shown many business leaders that their people can be productive, engaged and happy working from home.”
Over at Schroders, the fund management house, the view is similar. Flexible working “will ultimately prove a huge shot in the arm for productivity in the long term”, it says. Both firms are planning to allow the majority of staff to continue to work from home even when the pandemic is over.
Related: PwC and Schroders will allow staff to work from home after Covid crisis
The judgment that productivity will improve is interesting. Perhaps it will prove correct, but a five-month experiment, in which rivals are also obliged to participate, seems too short to draw firm conclusions. Let’s see what happens when the novelty wears off and stay-at-home employees start to worry they’re missing out on promotion. Presenteeism is a powerful force; it feels a little early to write it off.
