Ryanair conquered the air with tickets at very low prices. Now it is clear that they must disappear

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“It’s too cheap for what it is. it seems absurd to me that every time I fly to [el aeropuerto de] Stansted, train travel to central London is more expensive than airfare.”

The reflection is not surprising both for the price contrast it raises and for who pronounces it: Michel O’Learythe CEO of Ryanair, the company that has probably most influenced the low-cost market in recent decades and often allows you to fly from one end of Europe to the other for much less than the cost of a taxi that takes you from home to the airport.

During an interview with Financial Times, the CEO of Ryanair predicts changes in the sector that will directly affect its pricing policy, the strong point of low cost companies and what defines them on the commercial board. The manager acknowledges that flying has become “too cheap”a hook that has managed to attract passengers, but that greatly complicates the profitability of operations as the airlines themselves see their costs increase.

“Too cheap”

“It’s too cheap for what it is” emphasizes O’Leary. His calculations indicate that the rise in the price of oil and environmental fees will mean that in the medium term Ryanair’s average fare increases significantly: from 40 euros it could go to a range of between 50 and 60.

Without that rate hike, which O’Leary predicts for the next five years, operations will simply no longer be “sustainable.” “Ultimately, I don’t think traveling by plane be sustainable in the medium term with an average rate of 40 euros. At that price it is too cheap. But I think it will still be very cheap and affordable at 50 and 60 euros.” explained the manager.

Although the person in charge of Ryanair draws a scenario for five years, his words actually have little of an oracle or prophecy. The rise in fuel prices has already led Nigeria to suspend domestic flights and Europe and the United States also register a rise in the price of tickets as demand reactivates after the health crisis and airlines are being forced to cut their prices. capacity due to lack of staff. Airlines UK calculates that British companies alone have laid off some 30,000 employees during the pandemic.

Although flying is still today cheaper than a decade ago, Financial Times points out that the average fares between London, Portugal, Spain or Greece are at higher levels than a year ago. The phenomenon is far from exclusive to Ryanair and also affects other airlines with a marked low cost profile or even ultra low costWhat easyjet or the hungarian WizzAir.

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Since Ryanair had covered much of its fuel needs for 2022 before the Russian invasion of Ukraine, it managed to avoid the price spike that followed the war. Despite this advantage, O’Leary is convinced that the value of oil will remain “structurally higher” over the next four or five years, which could make tariffs more expensive.

Others are added to this handicap, such as personnel costs, charges for air traffic control or environmental charges for the pollution generated by the airlines themselves.

about the demand, O’Leary recalls that a large part of airline customers, especially younger ones, have grown accustomed to the low cost offer. “There is a generation of Europeans and Britons under 40 who do not know what it was [viajar] with high fees. They have never grown up in a time when there were high airfares or restricted practices or legacy flag carriers. They hope to be able to fly around Europe for £40 or £50 a ticket.”

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“That genie is never going to be put back in the bottle,” continues the head of Ryanair in another interview posted on The Telegraph—. So I think there is a strong and vibrant future for low-cost air travel around, in a non-political sense, Europe.”

And beyond the continent, on international flights? The scenario arises in this case with less security for O’Leary, although he is confident that it will grow. “People have been locked up for two years, they have been saving for two years, they are desperate to go on vacation,” jokes.

Pictures | Sandor Somkuti (Flickr) Y World Travel & Tourism Council (Flickr)

“It’s too cheap for what it is. it seems absurd to me that every time I fly to [el aeropuerto…

“It’s too cheap for what it is. it seems absurd to me that every time I fly to [el aeropuerto…

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