Jet2 doubles down on package holidays as sales of exclusive flights fall

Jet2 has backed package holidays to further boost sales as cash-strapped customers book fewer flight-only deals.

The group told investors that increased demand for package holidays helped boost revenue over the summer, offsetting a drop in flight-only sales.

Jet2 said its package holiday prices have remained “resilient” and “continued to show a modest increase on last year”.

However, this summer it saw “softer net ticket yields only from flights,” he told shareholders on Thursday.

Seating capacity for sale was 12.4 percent higher than last summer at 17.17 million, a “slight increase” from the level reported in its preliminary results.

Jet2 said July and August saw a “strong” boost in late bookings, with September showing a similar trend.

As a result, the average load factor was 1.2 percent behind that of summer 2023 at the same time.

Package holiday customers booked to date increased by 8 percent, representing 70.2 percent of total departing passengers, and flying-only passengers increased by 17 percent.

Jet2 said: ‘Looking ahead, we continue to believe that package holidays are the right product for value-conscious customers.

‘Our ability to offer a wide selection of quality products and the flexibility of a truly variable length holiday makes it easy for our customers to comfortably tailor their holiday plans to their individual budgets.’

The London-listed group added that forward bookings for winter 2024/25 were “encouraging”, with an average load factor of 0.8 per cent ahead of winter 2023/24 at the same time, against a 15 per cent increase in seat capacity to 5.14 million seats.

Jet2 operates from 11 airport bases in the UK: Belfast International, Birmingham, Bristol, East Midlands, Edinburgh, Glasgow, Leeds Bradford, Liverpool John Lennon, Manchester, Newcastle and London Stansted. A further base will open at Bournemouth Airport in February 2025.

Jet2 shares rose 0.62 percent or 9.00 pence to 1,464.00 pence on Thursday, having risen more than 39 percent over the past year.

Russ Mould, investment director at AJ Bell, said: ‘Jet2 has built a reputation as one of the most trusted names in travel.

“There is a lot of confidence in the company and that has helped it to increase its market share over the years and become one of the big players in the lower-cost segment of the market. Demand is generally strong and the company continues to perform well.

“Unfortunately, that is not enough for investors. They are currently scared by the lack of earnings visibility and the situation does not seem to be improving in the near future.”

He added: “The sector has suffered because consumers are waiting until the last minute to book their flights. This has led to a price war between airlines. Names like Jet2 are still managing to attract customers, but not at the optimal price.

‘Most of the summer season has been good for Jet2, with a surge in package holiday customers helping to offset lower ticket prices for flight-only travellers.

“Unfortunately, their clientele is more of a last-minute rather than an early-booking type. There is no end in sight to this booking trend, so it is not known how many seats will ultimately be filled for the final months of the summer season and for the winter period.”