EasyJet suffered one of the biggest share-price falls in its history after passenger figures for December showed a drop in the proportion of seats sold of two percentage points.
Its shares fell 14% despite the carrier leaving its annual profit forecast unchanged at close to £230 million.
Passenger numbers were up 10% on December 2006 and 13.5% over the year as a whole to 38 million. But analysts pointed out the increase lagged behind EasyJet’s planned expansion rate.
An EasyJet spokeswoman insisted: “We can reduce fares to stimulate demand.” However, analysts fear the low-cost carriers cannot continue expanding at the current rate without trashing their margins.
Chief executive Andy Harrison acknowledged concern about the price of fuel affecting demand. He said: “All carriers will have to pass on the increase to consumers in one way or another, but there are concerns whether the price increases will stick.”