Industry reaction after UK votes to leave the EU

Industry reaction after UK votes to leave the EU

Updated 11.42

Industry leaders reacted to the vote to leave the EU by insisting it should have little immediate impact on travel.

EasyJet, which identified strongly with the campaign to remain, issued a statement saying it is confident the vote "will not have a material impact on its strategy or its ability to deliver long term sustainable earnings growth and returns to shareholders".

British Airways’ parent IAG said the same but also downgraded its profits forecast for the year.

In a statement IAG said: “IAG believes the vote to leave the EU will not have a long term material impact on its business. However, in the run up to the UK referendum during June, IAG experienced a weaker than expected trading environment.

"While IAG continues to expect a significant increase in operating profit this year, it no longer expects to generate an absolute operating profit increase similar to 2015."

An easyJet spokesman said: "EasyJet has been preparing for this eventuality in the lead up to the referendum vote and has been working on a number of options that will allow it to continue flying in all of its markets.

Carolyn McCall, easyJet chief executive and a business advisor to David Cameron, said: “We have today written to the UK Government and the European Commission to ask them to prioritise the UK remaining part of the single EU aviation market.”

TUI group chief executive Fritz Joussen, said: “The EU without the UK is barely conceivable but we respect the democratic decision of the British people and trust the UK government will take all steps necessary to ensure economic and political stability.

"We are well prepared and confident that TUI Group will not be significantly affected by the decision. It remains to be seen how the decision will affect consumer sentiment."

Heathrow Airport issued a statement saying: "Anyone travelling through the airport will find it operating normally with no changes to security and immigration."

Deirdre Wells, chief executive of inbound travel association UKinbound whose members voted overwhelmingly to support the Remain campaign, described the result as "disappointing".

She said: "Inevitably it will have far-reaching consequences for our members. However, we have proved time and again that we are a resilient industry and the Government must now work hard to secure a deal which supports our vibrant industry, which relies on the EU for two-thirds of its business."

The referendum result saw the pound plunge to levels not seen since 1985 and prime minister David Cameron announced he would resign in October.

Tim Alderslade, chief executive of the British Air Transport Association (BATA), said: “The Government must urgently confirm that the UK will seek to remain a member of the European single aviation market once we leave the EU.

"We also call on the Government to prioritise all aviation-related negotiations, agreements and decisions during the EU withdrawal process."

Airline BMI Regional warned that it may quit the UK. Chief executive Peter Simpson described the vote as creating “a lot of uncertainty”.

He said: “For a business such as BMI Regional, being heavily influenced by the freedom of trade and traffic, this uncertainty will undoubtedly add a layer of complexity to our business.

“Our continued business domicile as a UK entity is less than clear at this point in time.

“Should the dynamics that unfold prove too challenging to pursue these opportunities, our base as a UK airline may have to be reviewed.

“Any decision regarding a move to another domicile will not be taken lightly and will be carefully considered. Ultimately, the best interests of our customers, employees and shareholders will guide that decision.”

Travelzoo UK managing director, Joel Brandon-Bravo, said: “With so many variables in play it’s difficult to predict the exact impact the Leave vote will have on the tourism industry, but research suggests it will be a negative one.

“In order to ensure UK travellers and the UK tourism industry do not suffer as we enter the busiest months for travel, the UK government has got to enter negotiations with Brussels immediately over the EU policy which impacts travel.”

He described the next 24 months of negotiations as being crucial for British travel - particularly if the government wants to maintain inbound tourism from the EU and avoid a price hike for Britons wanting to travel abroad for holidays.

“Obviously top priority is dealing with the impact the referendum result will have on the value of the pound, but there are other factors that could make the result a big blow for the travel industry,” Brandon-Bravo cautioned.

“As such, we’re now urging the government to act quickly to renegotiate how an independent UK operates in The European Common Aviation Area.

“UK airlines seem unanimous in the opinion that a Brexit will lead to reduced competition, reduced routes and higher travel prices. A concern shared by UK consumers with over a quarter (28%) saying they’re worried a Brexit will lead to more expensive holidays.

“Other factors now also up for negotiation, that could lead to a price hike for British tourists include the loss of the EHIC card - which gives EU members the right to health treatment in any EU country, a potential increase in roaming charges following a recent EU initiative cap on charges, and, inevitable changes to visa regulations for Britons travelling to the EU.”

Meanwhile, a presumptive plan by Ryanair last night to run a 24-hour sale of seats from £9.99 to ‘celebrate remain in Europe’ backfired as the final results counted in the early hours of this morning resulted in a ‘leave’ vote with a turnout of 72%.

Chief executive Michael O’Leary, a vocal supporter of the Remain campaign, said: “If the Leave side do win, then these will be the last low fares the UK will enjoy for a very long time.”

The hospitality sector is well placed to remain in a robust position following the Brexit vote, a hotel chief claimed this morning.

John Brennan, chief executive of Amaris Hospitality - one of the UK and Ireland's largest hotel investment and hospitality groups - admitted that there would be an immediate period of uncertainty after the vote to leave the European Union.

"We are now entering a period of uncertainly as Britain prepares the ground for exit,” he said.

“While the negotiation period could have an affect on the markets overall in the short-term, the hospitality sector is well-placed to remain robust during this period.”

However, Brennan added: "International tourism is one of the most rapidly growing sectors of the UK economy as disposable incomes increase around the world.

“With sterling weakening on this news, the rest of the world will get more pounds for their currency, making the UK a cheaper destination to visit, and conversely making it expensive for Britons going abroad.

"We would, however, encourage government to provide clarity on the exit process and address the areas of uncertainty prompted by this decision as soon as possible."

The trade body representing regional airlines in Europe has voiced concern over the UK Brexit vote.

Simon McNamara, director general of the European Regions Airline Association, said: “Aviation is a global industry that works best in a borderless environment where the free movement of people allows airlines to move passengers seamlessly and without complication.”

He added: “Time will tell what this vote will mean for the UK and wider European aviation sector.

“As a European association, ERA represents both EU and non-EU member airlines and has associate and affiliate members from across the globe.

“ERA represents its 53 member airlines at the highest levels in Europe.

“Our airlines face similar challenges and ERA protects and safeguards their interests whether they are members of the EU, European Common Aviation Area, or have chosen to negotiate a bilateral aviation agreement with the EU or another European country.

“Through our extensive experience ERA will continue to support our members flying to, from and within the UK as it becomes clearer what the implications of the vote are for the aviation industry.”

Meanwhile, British Airways, Aer Lingus, Iberia and Vueling owner International Airlines Group followed easyJet in claiming the ‘Out’ vote “will not have a long term material impact on its business”.

But the company said: “In the short term, however, in the run up to the UK referendum during June, IAG experienced a weaker than expected trading environment.

“Following the outcome of the referendum, and given current market volatility, while IAG continues to expect a significant increase in operating profit this year, it no longer expects to generate an absolute operating profit increase similar to 2015.”

The head of the UK airline pilots union reacted to the Brexit vote by voicing “deep concern” for the sector.

British Airline Pilots Association general secretary Brian Strutton was responding to the result of the EU referendum and early analyst predictions on the possible effects the decision to leave will have on aviation.

He said: “We are deeply concerned about the potential effects of the UK's decision to leave the EU on the future of our thriving aviation sector.

“In particular, we note that analysts are predicting a reduction in demand for leisure and business travel, and a reduction in business confidence.

“The uncertainty ahead will be of great concern to pilots and the other thousands of people who work in the air transport sector.

“Whatever changes lie ahead, BALPA remains committed to ensuring the aviation sector can continue to thrive outside the EU.”


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