Jet2 points to softening in holiday prices ahead of summer season

Jet2 has signalled that post-pandemic price increases for holidays may be starting to ease heading into the summer as competition heats up across the sector.

The tour operator and airline said that, while trips booked for the coming summer have seen “a modest increase” in cost compared with last year, prices have recently become “more competitive, particularly for April and May departures”.

In a trading update, Jet2 added that package holiday and flight-only bookings are up 13% and 18% respectively for the summer period versus this time last year.

The update will give consumers hope that holiday price rises may be less dramatic this year than last.

In November, Jet2 said the average price of one of its trips had increased 11%, while some airlines reported price rises of as much as 26% last summer.

Russ Mould, an analyst at AJ Bell, said: “This could be a sign that the pricing power enjoyed by the sector, with people prepared to pay whatever it takes to get their week in the sun, is starting to ease.”

Jet2 shares fell 5% in Wednesday morning trading as investors were spooked by the company’s pricing comments.

The group said demand is proving strong for the peak season, revealing it has sold 55% of its plane tickets and package holidays for the summer season and has 12.3% more seats available than last year, at 17.1 million.

It added that it has bought 90% of its fuel for the forthcoming season, and more than 80% for the full financial year, meaning it is less exposed to tensions in the Middle East which could affect oil prices.

After rising last week amid fears that attacks between Iran and Israel would flare up further, oil has retreated in recent days amid an apparent easing in tensions.

Jet2 added that it is still “mindful of the current macro-economic and geo-political environments and how these may impact future consumer spending”.

It said that, with nearly half of the summer tickets still to sell, it could not give guidance on the 2024-25 full year.

However, it said pre-tax profit for the year ending March 31 2024 is on course to come in about one-third higher than the previous year, at between £515 million and £520 million.

Jet2 chief executive Steve Heapy said: “Although still very early in full-year 2025, we remain confident that customers will continue to travel with us from our rainy island to the sun spots of the Mediterranean, the Canary Islands and to European leisure cities.”