riceMichael O’Leary has dropped the eye-catching gimmicks and outrageous proposals that used to secure him and his airline, Ryanair, the headlines. No more slandering customers, suggesting only standing tickets or charging to use the toilet on the plane, and no more dressing up as court jesters or leprechauns. Now that Ryanair is Europe’s largest airline – a fifth of the continent’s flights come from its fleet of 550 aircraft – it looks like the “slightly more corporate” requirement outweighs the “looks like an ‘eejit’ running around” Need, he said, almost wistfully.
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In fact, today’s low-cost airline’s achievements speak for themselves and need no gimmicks. From its listing in 1997 to 2019, passenger numbers have grown by an average of 19% per year. While most rivals are struggling to regain lost ground, Ryanair has emerged from the covid-19 pandemic stronger. The summer flight schedule, which will increase the number of daily flights from 2,000 to 3,000 from March 29, has already attracted strong bookings. That could boost passenger numbers to 168 million in the fiscal year that ended in March, easily surpassing the pre-pandemic figure of 149 million. Mr O’Leary said Ryanair had achieved this “partly by luck and partly by bravery”.
It certainly took some courage to resist layoffs being carried out by other airline bosses when covid-19 grounded many of their flights. Ryanair has kept most of its staff on lower wages and rotated cabin crew on the few remaining flights to keep their licenses valid. It also started hiring again before anyone else. It has the ability to do so thanks to a strong balance sheet built on a business model of ultra-low-cost flying: fill planes with the lowest fares on routes between the cheapest airports, and charge extra for everything else (except toilets).The company also renegotiated an order for 135 Boeing 737s, as consulting firm Aviation Strategy noted. maximum The narrowbody, if the rumors are true, ordered another 75 at the height of the covid recession in 2020 at a third of the list price.
Talks with Boeing over aircraft for the next phase of Ryanair’s expansion plans have stalled after the planemaker refused to offer more discounts. But Mr O’Leary is confident he can strike a deal within the next few years that will allow his planes to carry 300 million passengers by 2035. He also estimates that the European airline industry is entering a period of stabilization after 30 years of overcapacity. Barriers to entry are already rising. An aircraft manufacturing duopoly from Boeing and Airbus, both of which are fully booked through 2027. Another is higher interest rates and financial uncertainty, which make it harder for newcomers to raise capital. The third is Ryanair itself, scaring off rivals with some of the lowest-cost fares in the industry and a knack for turning the corner. “Wars, plagues… there’s always going to be problems,” Mr O’Leary admitted. But it’s also “where the opportunity comes”. ■
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