Why Heathrow got the backing of Gatwick's biggest customer

Carolyn McCall has taken easyJet to new heights in her five years in charge. So what does the future hold for the low-cost airline? Slots at an expanded Heathrow? Matthew Gwyther spent a day with the CEO and her team to find out.

by Matthew Gwyther
Last Updated: 02 Dec 2015

It's easy to forget, with a capitalisation of more than £6 billion, 600 routes, and a turnover of more than £5 billion a year, that easyJet still rigorously follows the low-cost model of airline business. Easy until you arrive to spend the day at its corporate HQ - Hangar 89 at Luton Airport. The converted 1970s aircraft garage is a large, orange, human battery farm. The 1,000 inhabitants share the shed with a couple of Airbuses parked out back for maintenance. Low-cost office space extends to the CEO, too. Carolyn McCall may have just celebrated five years as boss, but still sits behind the cramped desk that she shares with her PA in the corner of the open-plan office.

Rudely dismissed as a 'media luvvie' on her arrival by arch-rival Michael O'Leary of Ryanair, McCall has proved the loud-mouthed Irishman wrong. After a wobbly start, she has comprehensively turned the ailing airline around. The network has broadened, business passengers are being wooed and profits are up. The share price had, at one point, multiplied fourfold. McCall even appears to have achieved a task beyond any previous CEO - keeping the founder Stelios in his box. She is one of five female CEOs in the FTSE 100 and, one suspects, probably the most popular, being more interested in people than planes.

When MT interviewed the then easyJet chairman Sir Mike Rake in 2013, he said airlines weren't 'complex'. That's as maybe but life in Hangar 89 is anything but straightforward. Running a low-cost airline is like plate-spinning in a gale.

With stroppy French air traffic controllers tripping you up, oil prices making you skid and volcanoes going off. A day spent reality TV-style running around the building after the CEO is a revealing one.

09.30: daily operations meeting

A dozen colleagues file in quietly and are joined on the daily conference call by country heads from all over Europe to dissect the previous 24-hours performance. 'Hey, Alberto.' McCall comes in and shares a cup of tea with a colleague. There are many jeans and shirts outside trousers. No suits. McCall is, by some margin, the best-dressed employee at easyJet.

Will Facey is the director of network operations and this is his show. He proceeds briskly through the post-mortem of the previous 24 hours. 'So ... yesterday. We did 1,496 sectors, carried 211,000 passengers ... We had 72.7% on time but three flights delayed more than three hours. We had a FOD (foreign object damage) ingestion at Luton. Passenger dislocated their knee during boarding on Luton to Madrid. Had to take a whole seat row out to get the paramedics in. (Squirms all round) 147-minute delay. We had a whistling noise in the wheel on an Amsterdam to Malpensa. A catering truck hit the aircraft at Bristol. We had a panic attack on Palermo to Orly when a female put on the lifejacket and tried to open the emergency door. Diverted to Lyon where two pregnant ladies also decided to get off. They took the train to Paris. We paid. Overall: we had the usual suspects - Fiumicino and Gatwick. Not so good. Not so good.'

EasyJet is Gatwick's biggest customer and has 58 aircraft based there. Its efficiency is currently a bit of a worry. Last summer the ground handler Swissport had a near meltdown caused by chronic understaffing. Nobody wants a repeat with the busiest 12 weeks of the year just starting. McCall has been making high-level calls. Later in the week, the airline's considerable dissatisfaction with Rome's main airport, Fiumicino - dogged by poor management, a 70% hike in fees last year and a recent terminal fire - is confirmed when it announces a pull-out from its base there, where it has 300 crew.

McCall listens carefully to Facey and says very little. This is the 'operations' show - the field marshal listening to her general. Other colleagues from customer services chip in. 'The customer service centre took 10,289 calls. There was an average 258-second waiting time. We had 922 Tweets and Facebook posts. We put up an incorrect map of Greece, which attracted a lot of comment. The Kate Moss Tweets appear finally to have gone away (Luton police were called to Moss's incoming flight from Turkey the week before when the model started swigging vodka from her duty-free bottle and called the pilot 'a basic bitch'.) Strikes - nothing on the horizon.' Not even the French air traffic controllers.

Facey looks worn. 'I was born aged 40,' he explains. A hire from DHL and now eight years into the job, he works five days a week from 7.30am and until 7pm. He also calls in at weekends. 'This isn't a job - it's fun,' he says. 'The absolutely key thing for us at the moment is getting the 50 or so "first wave" of departures out of Gatwick on time early in the morning.'

For low-cost operators who sweat their aircraft assets hard by keeping them in the air most of the day, this is critical. If delays are already on the board before 10am the knock-on effect by that evening can be disastrous.

Facey does not flap easily. So what would be his worst nightmare? 'An uncontrollable situation. When they told me about the volcano (the Icelandic ash-gusher, Eyjafjallajokull, which erupted in 2010 and closed all European airspace) I thought it was an April 1st joke. Those five days were the hardest of my whole career. Stopping an entire network is simple compared to getting it going again.'

Daily operations led by Facey: a 24-hour tale of foreign object damage, dislocated knees and panic attacks. McCall and her PA: low-cost and cosy

10.20: airline management board meeting

McCall's 14 most senior managers are round the table - operations, marketing, HR, comms, legal, finance. There is plenty to discuss. Her style is straightforward, inquiring but inclusive. Favoured phrases are: 'Let's finish with the operational and look at the emotional.' 'I want you to share your instincts.' 'Are you confident that we are resilient?' The word 'risk' comes up again and again. One thing that gets her cross is the terminology used to describe pilots in training. 'Stop calling them flexi-crew,' she yells. 'Just stop. They are cadets.'

What can be done to keep the Gatwick crew onside during a long, hot summer? Brian Tyrrell, head of flight operations and a pilot is answering many questions. 'There's only so much I can do here,' notes McCall. 'If crew suddenly see me popping up at the ramp with a tray of biscuits that just isn't going to work.' She's good face to face but deus ex machina with chocolate digestives isn't her style. And never mind Gatwick what about Nice where they have seven out of 15 pilots on long-term sick leave, including a pair having hip replacements?

Next up are the results of the staff survey. The man from Ipsos MORI shuffles into the boardroom with his laptop and slides. The big picture is when it comes to staff engagement, easyJet stands a full 19 points above any airline worldwide.'This is your key strength,' he says. Hardly anyone seems to appear pleased.

This is where McCall has made an enormous difference to the airline. When she arrived some pilot engagement scores were as low as 7%. Pilots are notoriously difficult to keep happy. The crème de la crème of any airline - paid very substantially more than the cabin crew with whom they work - they get cheesed off easily.

'What can you do with pilots?' asks one. 'You're 28 and you think to yourself - I've made it. I'm going to be flying one of these A320s now until I'm 65. That's nearly 40 years.' Levels of engagement are almost unbeatable in the first few years of service but by year six they have gone down a lot. There is a lengthy and as yet unresolved negotiation going on with BALPA, the pilots' union, about a new 'Lifestyle' deal which would mean the possibility of part-time working. It has stalled over the costs of buying out full-time contracts. Meanwhile BA is recruiting at very low pay levels. This cramps McCall's room for manoeuvre.

EasyJet appears to be faced by the classic engagement dilemma for management. A high degree of satisfaction combined with good financial results breed higher expectations, which may not then be met. It's not just HR and Training who pitch in. Marketing has a lot to say. They discuss the 'interesting tension' between operational people and back office. And this is only the first discussion of the staff survey results. They take them very seriously and there are numerous meetings scheduled over the next four months to analyse the minutiae, and act on the results.

The management board grapples with Gatwick. Sophie Dekkers networks with easyJet women

12.00: women's network lunch

The meeting goes on discussing what the opposition are up to in great detail. McCall leaves for a female-only networking lunch downstairs. This is hosted by Sophie Dekkers, a McCall protegee, who started as a market researcher and has made her way right up to director of UK operations.

The audience of young women is rapt. Dekkers gives a very personal account of career progression, maternity leave, imposter syndrome, handling rejection and the 'nice girls don't ask' phenomenon. She wears exactly the same watch as her CEO.

13.05: more management board

McCall goes back upstairs to the meeting. Steaming, foil-covered aluminum cartons cover the board table. When she arrived one of the big staff grumps was about the quality of the food on board. There had been bitter rows about the end of free tea for crew.

This lunchtime session is for the whole management board to sample some new crew food ideas. New York deli bagels are apparently highly popular and get snaffled first by the pilots. McCall seems disapproving. 'And I get so many emails about Pot Noodles!' she protests. 'Terrible. So much saturated fat and salt!'

The new stuff - fresh wraps, penne all'arrabbiata, mild African beef curry - looks and tastes pretty good. Peter Duffy, the head of marketing seems unimpressed by Worcester sauce flavoured popcorn.

15.30: crew room visit

McCall goes downstairs and into the crew room where pilots and cabin get together for pre-flight briefings, and de-briefs after they have returned home. She chats to several groups to find out what's on their minds. All seems quite relaxed until a female pilot who is just going off-shift comes over to her. 'Carolyn I've got to talk to you about Sunday. It was a car crash, a complete car crash.' McCall takes her to one side, gets a piece of paper and starts taking notes.

Management get stuck into penne all’arrabbiata and new crew food delights. McCall chews the fat with cabin staff

17.05: Ian Davies, director of engineering

Davies is a classic chief engineer. Trained from his mid-teens in the military, he joined in 2008 from BMI. Since his arrival, the fleet has grown from 130 aircraft to 240. He has his hands full but has won awards for his work in helping devise a system to test, mid-air, for volcanic ash, and he's also been in the forefront of using drones to inspect aircraft.

With McCall coming from a media background - she joined the Guardian way back in 1986, rising to be CEO from 2006-2010 - it was old salts like Davies who required convincing fast. 'Carolyn was the first female CEO I've worked for. I recall thinking we could have done with a bit less testosterone and a little more, er, oestrogen around here. You know - stop the turks.

'Everyone says it but she really does have that great knack of making you believe you are the most important person in the world when she's speaking to you. She not only listens carefully but she hears. You can brief her very fast. But she really is a tough negotiator. I like the fact she can smell bullshit at 100 paces.

'I know someone who had a disagreement with her say that he got the roughest bollocking of his career. When we were negotiating with Airbus and the engine makers we got down to that "last ask" meeting at our lawyers in London she did it so well. But we've got to be careful not to beatify her too soon. We've still got lots to do,' he says.

We talk about the Germanwings accident in March, in which 150 people died. 'I think we knew pretty soon that there was something not right there ...' Davies notes that the accident has probably halted the research into single-piloted planes for the time being. But in the long run the goal is to fly aircraft remotely - and more cheaply - like drones from the ground.

Meanwhile several people are having a quiet smirk about a story that has appeared in the French media saying that Ryanair staff working at the Irish airlines base are staying in tents near Marseilles. There's low cost and there's low cost.

17.30: Orange Tree cafe

McCall emerges from another meeting for a 20-minute MT chat. So, five years. What has been the most difficult moment or decision in that half decade? 'The hardest thing is the external factors,' she says. 'Those things beyond your control that affect what you do. So fuel, foreign exchange, ATC strikes, volcanoes. You name it. All you can do is plan for uncertainty and manage it well when it happens. That's what makes airlines different. It's full on all the time. Never lets up. It's Sunday and you're laying there and the phone goes ...' and it's Kate Moss. Did she know what a 'basic bitch' was? 'New one on me ...'

'Look, it's easier now than at the beginning. My first eight months was an assault course. But I do now feel on top of it. You couldn't survive otherwise. So intense - people judging you every minute internally and externally. Innate confidence is very helpful. You need to be sure of your instincts.'

Because colleagues really look up to you? They need you to make them feel secure? Isn't that the downside of being so open and approachable. 'They want you to take that uncertainty away from them,' she admits. 'Take it on board. So, you have to be clear what the vision is. For me leadership is having that strategic vision but also the ability to communicate it. You have to bring people with you. That's how you deliver. Every time we enter the summer everyone is very nervous. An awful lot to do. Huge 94% load factors. People's holidays are our critical trading period.'

McCall: fresh as a daisy at 6pm. Photographs: Tom Campbell

And London's new runway? EasyJet came out publicly and unexpectedly for Heathrow where it has no current operation. This cannot have made Gatwick very happy. 'We looked very very closely at it. The economics work for us at Heathrow. It's a hub in huge demand but you cannot buy slots at Heathrow. We would go in under a new structure (ie cheaper).'

But how did Gatwick feel? 'Of course, they are disappointed. We have a good relationship there - we're the single largest player. But government said you must say what you think.'

And when might the Howard Davies recommendation be implemented? 'I have no idea what will happen. It has always been deeply political. It's very difficult. It's been so long in discussion.' Surely Cameron cannot do nothing 'I don't know. It's 2025. Who knows? Opportunities to defer decision.' She raises her eyebrows a little.

And with that she's off for some more meetings before heading home to Berkhampstead. She is going to be up at 4am for an early flight to Brussels. Then overnight abroad before flying to Rome to tell her 300 staff face to face that their base is closing. And there is the long, hard summer ahead. And, after that, who knows. She surely has at least one more big job left in her.

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