EasyJet Seals Luton Hub Growth Pact Amid Fleet Expansion

EasyJet Plc, Europe’s second-biggest discount airline, sealed its third airport-expansion deal in nine months, minimizing access charges at its U.K. hub and paving the way for the arrival of 135 jets starting in 2015.

EasyJet aims to double capacity at its Luton headquarters to 9 million passengers annually following a 10-year deal with operators Ardian and AENA. Seating on flights at its second-largest base should gain about 20 percent over the next year.

The deal comes three days after EasyJet announced a seven-year pact with Gatwick, London’s second-busiest airport, and follows a July agreement with Stansted, the No. 3. EasyJet serves 39 destinations from Luton, located north of the capital, accounting for 45 percent of all passengers there. Heathrow is the city’s busiest airport.

“These long-term partnerships are really important because they include pricing certainty, which is all about what we can do on our fares, but they also have elements of infrastructure and development,” EasyJet Chief Executive Officer Carolyn McCall said at a press conference.

Luton, which attracted 9.7 million customers in 2013, plans to spend 150 million pounds ($250 million) on improvements. Upgrades to the terminal, as well as better rail and road connections, will help boost its appeal to business travelers and draw more people from north London, McCall said.

“The reality is, a lot of people who know about Luton and find it very convenient use it a lot for business,” she said.

EasyJet also plans to increase flights and deploy larger variants of Airbus Group NV’s A320 narrow-body jets to lift passenger numbers at Gatwick 10 percent through March 2015.

The airline currently carries more than 14 million people a year at Europe’s busiest single runway airport.

(Corrects Gatwick ranking in third paragraph.)
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