Stelios: EasyJet gouging customers with ‘useless services’ - Car Rental News
Stelios: EasyJet gouging customers with ‘useless services’
Car Rental News - 21/06/2010
EasyJet plc founder says airline’s food, car rentals ‘tarnishing’ brand.
The founder of easyGroup, easyJet plc and a range of other easy-branded businesses has lashed out at the airline using his easy brand, saying the carrier is gouging customers with a range of services like food and car hire he says are useless and are damaging to the easy brand. In court, Stelios Haji-Ioannou accused the airline of breaking its brand licensing agreement. He said the airline was attempting to generate revenues by squeezing passengers for a range of services in a way that risks damaging the easy brand. He said the airline was trying to bolster its profitability by expanding into areas not covered by the licensing agreement.
Stelios went on to question the airline’s strategy. He pointed out that the airline had a profit margin in its last financial year of 1.6 per cent. This contrasts poorly with the 11.2 per cent profit margin it enjoyed in the first year following its initial public offering, which took place in 2000. Stelios resigned from the easyJet management board in May of this year after he failed to convince the airline’s management team to restrict its on-going expansion. Stelios had been at the airline he founded since 1995 and still owns 38 per cent of the shares in easyJet.