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Highlights
- Airlines across the UK are cancelling flights every day due to a shortage of airport staff.
- Trade body IATA has blamed the delay in security clearances for the shortage.
Several airlines across the UK have cancelled flights on domestic and international routes owing to the shortage of staff. Carriers like British Airways, Easyjet, Tui, and Eurostar have axed hundreds of flights till the end of June. This has not only caused long queues at the airports but also disrupted the travel plans of thousands of travellers.
The International Air Transport Association (IATA), a trade association of airlines across the globe, has said that the delay in getting clearances for new employees is responsible for the shortage of staff.
According to the body, the time taken to get security clearances for new recruits has more than tripled - from four weeks previously to up to three months now. This results in the staff looking out for jobs somewhere else.
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The government claims it has been pushing the travel industry to ensure there is enough staff to deal with the post-pandemic demand. In April, transport secretary Grant Shapps announced new measures to accelerate the recruitment process for airlines. Under these, airlines would be allowed to start training new employees before getting security clearances.
Let us look at some FTSE-listed airline stocks and how they have been faring amid the disruptions.
International Consolidated Airlines (LON: IAG)
The International Consolidated Airlines Group owns British Airways, UK's flag carrier. It is listed on the blue-chip FTSE 100 index. The company recently announced a share buyback programme under which it will repurchase shares worth up to €32,000,000. The program, which started on 24 May 2022, will continue till 5 July 2022.
Shares of the company were trading 0.97% higher at GBX 128.88 as of 8:16 am GMT+1 on 1 June 2022. IAG has a market capitalisation of £6,334.05 million at present, and its share value has plummeted by 37% over the past one year. On a year-to-date or YTD basis, the share price has depreciated by 10.42%.
Easyjet Plc (LON: EZJ)
Easyjet is a low-cost airline and the UK's largest carrier by passenger numbers. Last week, the company was in the spotlight after an IT glitch forced it to ground about 200 flights around Europe. For the six months to 31 March, Easyjet posted a headline loss before tax of £545 million.
EasyJet’s shares price was hovering at GBX 518.80, up 0.23% at 8:15 am GMT+1 on Wednesday. The company holds a market capitalisation of £3,923.46 million at present. Its one-year return stands at -48.01%, while the YTD return is currently -5.76%.
Wizz Air Holdings Plc (LON: WIZZ)
Wizz Air Holdings Plc is another low-cost airline that operates on short-haul and medium-haul routes in the European Union and the Middle East. The airline has over 150 Airbus aircraft in its fleet and is listed on the FTSE 250 index.
The company holds a market cap of £3,009.72, and its shares were trading 0.17% down at GBX 2,915.00 as of 8:22 am GMT+1 on 1 June. Over the last one year, it has given a negative return of -40.20% to its shareholders.
Note: The above content constitutes a very preliminary observation or view based on market trends and is of limited scope without any in-depth fundamental valuation or technical analysis. Any interest in stocks or sectors should be thoroughly evaluated taking into consideration the associated risks.
