EasyJet’s share price has continued to struggle in the markets amidst a barrage of negative press indicating a looming strike and flight cancellations. On Tuesday, the share prices dropped by 6 per cent, before a small recovery in yesterday’s trading session, which saw prices rise by a percentage point.
EasyJet’s Plan to Cut 11,000 Flights
The Civil Aviation Authority’s announcement last week asking carriers to review their schedules and ensure flights were “deliverable” after post lockdown following a shortage of staff across the industry is likely to see more than 11,000 scheduled EasyJet flights cancelled.
According to reports, the directive will see a reduction in the number of flights at Gatwick airport, London’s second busiest airport, to 850 per day. EasyJet’s number of flights will also be limited at Amsterdam’s Schiphol airport, which is also likely to see a reduction in the number of flights the company makes in the summer.
On Monday, the company announced it would be consolidating its flights following the cap on flights at two of its biggest airports. Although the company did not specify how many flights would be cancelled, it did state that they would be operating at 90 per cent of their 2019 summer levels.
Having previously stated that they would achieve a 97 per cent reduction, this represents a reduction of at least 11,000 flights for the company. The company is also looking for a summer strike that will see most of their workers in Spain take a 7-day hiatus from their jobs. This is also likely to see its services interrupted, and result in further cancellations of flights.
EasyJet share price analysis
The impact of these cancellations is likely to see the company’s performance in the markets continue to struggle. Following yesterday’s small push to the upside, it is likely that we will see the resumption of the downward trend.
Therefore, my EasyJet share price prediction expects the prices to continue falling for the next few trading sessions. There is a high likelihood that we will see prices trading below the 400p price level in the next few trading sessions. However, good handling of flight cancellations may invalidate my bearish price analysis and result in a recovery.