Ryanair

Ryanair
For the unrelated American passenger airline, see Ryan International Airlines. For the unrelated American cargo-only airline, see Ryan Air Services.
Ryanair
IATA
FR		 ICAO
RYR		 Callsign
RYANAIR
Founded 1985
Operating bases
Fleet size 306(AllBoeing 737-800)
Destinations 165
Headquarters Dublin Airport, Ireland
Key people
Website www.ryanair.com

Ryanair (ISEQ: RYA, LSE: RYA, NASDAQ: RYAAY) is an Irish low-cost airline. Its head office is at Dublin Airport and its primary operational bases at Dublin Airport and London Stansted Airport.

Ryanair operates 300 Boeing 737-800 aircraft on over 1,100 routes across Europe and Morocco from 46 bases.[1][2] The airline has been characterised by rapid expansion, a result of the deregulation of the aviation industry in Europe in 1997 and the success of its low-cost business model.

Contents

History

ATR-42 in 1991

Ryanair has grown since its establishment in 1985 from a small airline flying a short hop from Waterford to London into one of Europe's largest carriers. After the rapidly growing airline was taken public in 1997, the money raised was used to expand the airline into a pan-European carrier. Revenues have risen from €231 million in 1998, to €1843 million in 2003 and €3013 million in 2010. Similarly net profits have increased from €48 million to €339 million over the same period.[3]

Early years

Ryanair was founded in 1985 by Christopher Ryan, Liam Lonergan (owner of Irish travel agent Club Travel) and Irish businessman Tony Ryan (after whom the company is named), founder of Guinness Peat Aviation and father of Cathal Ryan and Declan.[4] The airline began with a 14-seat Embraer Bandeirante turboprop aircraft, flying between Waterford and Gatwick Airport[5] with the aim of breaking the duopoly on London-Republic of Ireland flights at that time, held by British Airways and Aer Lingus.[6]

Embraer EMB 110 Bandeirante in 1988

In 1986, the company added a second route – flying Dublin–Luton International Airport in direct competition with the Aer Lingus / British Airways duopoly for the first time. Under partial EU deregulation, airlines could begin new international intra-EU services, as long as at least one of the two governments gave approval (the so-called "double-disapproval" regime). The Irish government at the time refused its approval, in order to protect Aer Lingus, but Britain, under Margaret Thatcher's pro-free-market Conservative government, approved the service. With two routes and two planes, the fledgling airline carried 82,000 passengers in one year. Passenger numbers continued to increase, but the airline generally ran at a loss and, by 1991, was in need of restructuring. Michael O'Leary was charged with the task of making the airline profitable. O'Leary quickly decided that the key to low fares was to implement quick turn-around times for aircraft, "no frills" and no business class, as well as operating a single model of aircraft.[7] In 1987, a Short Sunderland was operated by Ryanair.[8]

O'Leary returned from a visit to Southwest Airlines convinced that Ryanair could make huge inroads into the European air market, at that time dominated by national carriers, which were subsidised to various degrees by their parent countries. He competed with the major airlines by providing a "no-frills", low-cost service. Flights were scheduled into regional airports, which offered lower landing and handling charges than larger established international airports. O'Leary as Chief Executive took part in a publicity stunt, where he helped out with baggage handling on Ryanair flights at Dublin airport. By 1995, after the consistent pursuit of its low-cost business model, Ryanair celebrated its 10th birthday by carrying 2.25 million passengers.[9]

1992–1999

Ryanair operated BAC 1-11 series 500 aircraft between 1988 and 1993

In 1992, the European Union's (EU) deregulation of the air industry in Europe gave carriers from one EU country the right to operate scheduled services between other EU states and represented a major opportunity for Ryanair.[10] After a successful flotation on the Dublin Stock Exchange and the NASDAQ Stock exchanges, the airline launched services to Stockholm, Oslo (Sandefjord Airport, Torp, 110 km south of Oslo), Paris-Beauvais and Charleroi near Brussels.[11] In 1998, flush with new capital, the airline placed a massive US$2 billion order for 45 new Boeing 737-800 series aircraft.

Boeing 737-200 landing at Bristol Airport, the type operated by the company through the 1990s and until 2005.

2000–2006

The airline launched its website in 2000, with online booking initially said to be a small and unimportant part of the software supporting the site. Increasingly the online booking contributed to the aim of cutting flight prices by selling direct to passengers and excluding the costs imposed by travel agents. Within a year the website was handling three-quarters of all bookings. Today it is only possible to book seats via the website or via the "Ryanair direct" call-centre. No other possibilities are officially offered.[12]

Ryanair launched a new base of operation in Charleroi Airport in 2001 The airport was relabelled as "Brussels South", even though it is 30 miles distant from the Belgian capital. Later that year, the airline ordered 155 new Boeing 737-800 series aircraft from Boeing at what was believed to be a substantial discount, (taking full advantage of the downturn in airplane orders after the slump in air travel following the September 2001 aircraft attacks in the United States) to be delivered over eight years from 2002 to 2010. Approximately 100 of these aircraft had been delivered by the end of 2005, although there were slight delays in late 2005 caused by production disruptions arising from a Boeing machinists' strike.[13]

Boeing 737-800
Ryanair cabin with advertising on overhead lockers and safety cards on seatbacks
Ryanair Boeing 737-800s at Frankfurt-Hahn Airport

In 2003, Ryanair announced the order of a further 100 new Boeing 737-800 series aircraft.

In April 2003, Ryanair acquired its ailing competitor Buzz from KLM.[14] By the end of 2003, the airline flew 127 routes, of which 60 had opened in the previous 12 months.

By mid 2004 the airline was operating from a total of 11 bases across Europe.

During 2004, Michael O'Leary warned of a "bloodbath" during the winter from which only two or three low-cost airlines would emerge, the expectation being that these would be Ryanair and EasyJet.[15] A modest loss of €3.3 million in the second quarter of 2004 was the airline's first recorded loss for 15 years. However, the airline recovered posting profits soon after. The enlargement of the European Union on 1 May 2004 opened the way to more new routes as Ryanair and other budget airlines tapped the markets of the EU accession countries.[16]

In February 2005, Ryanair announced an order for a further 70 Boeing 737-800 aircraft, along with an option for a further 70. This was expected at the time to allow Ryanair to increase passenger numbers from the 34 million expected in 2005 to 70 million in 2011. Some of these aircraft would be deployed at Ryanair's 12 European bases, others to 10 new bases the company intended to establish over the next seven years.[17]

In June 2006, the company announced that in the quarter ending 30 June 2006, its average yields were 13% higher than the same quarter of the previous year[18] and its passenger numbers were up by 25% to 10.7 million, although year-on-year comparison was difficult, because of the movement of Easter from first quarter 2005 to second quarter 2006. Net profits (€115.7 m) increased by 80% over the same quarter in 2005. Management indicated that the level of growth may not be sustained for the remainder of that year, despite adding 27 new aircraft and opening new routes.[19]

Ryanair's passenger numbers have grown by up to 25% a year for most of the last decade. Carrying under 700,000 annually in its early years, passenger figures grew to 21.4 million in 2003. The rapid addition of new routes and new bases has enabled this growth in passenger numbers and made Ryanair among the largest carriers on European routes. In August 2004, the airline carried 20% more passengers within Europe than British Airways.[20]

Ryanair posted record half-year profits of €329 million for the six months ending 30 September 2006. Over the same period, passenger traffic grew by more than a fifth to 22.1 million passengers and revenues rose by a third to €1.256 billion.[21]

Dispatches programme

On 13 February 2006, Britain's Channel 4 broadcast a documentary as part of its Dispatches series, "Ryanair caught napping". The documentary criticised Ryanair's training policies, security procedures and aircraft hygiene, and highlighted poor staff morale. Ryanair denied the allegations[22] and claimed that promotional materials, in particular a photograph of a stewardess sleeping, had been faked by Dispatches.[23]

Aer Lingus takeover bid

Boeing 737-800 shortly after takeoff

On 5 October 2006, Ryanair launched a €1.48 billion (£1bn; $1.9bn) bid to buy fellow Irish carrier Aer Lingus. Ryanair CEO Michael O'Leary said the move was a "unique opportunity" to form an Irish airline. The "new" airline would carry over 50 million passengers a year.[24]

Aer Lingus floated on the Irish Stock Exchange on 2 October 2006, following a decision by the Irish government to sell more than 50% of its 85.1% share in the company. Workers retained a 15% stake. The shares began trading at €2.20 each, valuing the firm at €1.13bn. Ryanair said it had bought a 16% stake in Aer Lingus and was offering €2.80 per share for remaining shares.[25] On the same day, Aer Lingus rejected Ryanair's takeover bid, saying the bid was contradictory.[26] With a total of 47% of Aer Lingus in the hands of the Irish Government, the employee share ownership trust and other entities that publicly rejected the bid and a further 4% in the hands of the Bank of Ireland and AIB, who were considered highly unlikely to sell, the takeover bid was effectively dead. The Ryanair website described the attempted takeover as, "In October...we make an all cash offer for the small regional airline, Aer Lingus".[27]

2007

Boeing 737-800 at Leeds Bradford International Airport

Fourth quarter 2006 profits far exceeded analyst expectations and over the period from October 2006 to February 2007, the stock rose by some 50%. The press suggested that Ryanair was now selling on its 737-800s at higher prices than the cost of acquisition from Boeing.[28] They also noted that average fares keep increasing.[29]

In January, following a BBC investigation, Ryanair conceded that a claim it had cut its CO2 emissions by half in recent years was "an error".[30]

In the meantime, Ryanair continued to expand and establish new European bases.[31]

In May, Ryanair launched BING. This application brings daily fare specials to the user's computer.[32]

On 18 July, the British Advertising Standards Authority (ASA) ordered Ryanair not to repeat a claim that airline industry "accounts for just 2% of carbon dioxide emissions".[33] The ASA ruled it breached rules on truthfulness by not explaining the figure was based on global, rather than UK emissions (which are 5.5% of the total) and exclude incoming flight figures.[34]

In August, the company announced it would start charging passengers to check-in at the airport, therefore reversing its policy of paying for online check-in. It says that by cutting airport check-in it reduces overhead costs.[35]

RyanAtlantic

Boeing 737-800 at Bristol Airport

Ryanair's CEO, Michael O'Leary, stated in April 2007 that Ryanair planned to launch a new long-haul airline around 2009.[36] The new airline would be separate from Ryanair and operate under a different branding. It would offer both low cost with fares starting at €10.00 and a business class service which would be much more expensive, intended to rival airlines like Virgin Atlantic. The new airline would operate from Ryanair's existing bases in Europe, to approximately six new bases in the United States. The new American bases will not be main bases such as New York's JFK airport, but smaller airports located outside major cities. It is planned that the new airline will eventually operate a fleet of 40 to 50 new Airbus A350XWB or Boeing 787 Dreamliner aircraft. Since the Boeing 787 is sold out of production until at least 2012, and the Airbus A350 XWB will not enter service until 2013, this would contribute a delay to the airline's launch. It was not stated if other aircraft would be operated in the interim. O'Leary indicated that he intends to purchase the aircraft, when market prices for new aircraft recede, according to demand. It is said that the name of the new airline will be RyanAtlantic and will sell tickets through the Ryanair website under an alliance agreement.[37]

In February 2010, O'Leary said the launch would be delayed until 2014, at the earliest, because of the shortage of suitable, cheap aircraft.[38]

2008

Stockholm-Skavsta Airport in Nyköping is one of the 150 airports served by Ryanair

On 31 August 2008 the Sunday Times reported Ryanair was saving money by pressuring pilots to limit their discretionary fuel reserves. The discretionary reserves are in addition to the legal requirement for 5% extra fuel to be carried as a contingency, plus adequate fuel reserves to divert to an alternative airport, plus enough fuel to hold for 30 minutes at the destination airport. Ryanair has already suffered one incident in the past three years due to a low fuel situation.[39] This move was popular at all airlines because of the high cost of fuel in the summer of 2008.[40] Carrying lower reserves allows the plane to get better mileage than when it is overloaded with the excess weight of unused fuel.

In October, Ryanair withdrew operations from a base in Europe for the first time. Ryanair was unable to reach agreement with the local authorities in Valencia, Spain,[41] thus terminating many of its Valencia services after a year of operation, though some routes still remain open.[42] It is estimated the closure cost 750 jobs. Ryanair has since reintroduced its Valencia base, doubling its previous capacity.

In November, Ryanair announced they were planning to offer United States bound flights for around 10 euros by the end of 2009.[43] Such a move would still need to be negotiated and the relevant permissions obtained.[44]

Second Aer Lingus Takeover Bid

On 1 December 2008, Ryanair launched a second takeover bid of fellow Irish airline, Aer Lingus. Offering an all-cash offer of €748 million (£619mil; US$950mil). The offer was a 28% premium on the value of Aer Lingus stock, during the preceding 30 days. Ryanair said, "Aer Lingus, as a small, stand alone, regional airline, has been marginalised and bypassed, as most other EU flag carriers consolidate." The two airlines would operate separately. Ryanair stated they would double the Aer Lingus short haul fleet from 33 to 66 and create 1,000 new jobs.[45][46][47] The Aer Lingus Board rejected the offer and advised its shareholders to take no action.[48] On 22 January 2009, Ryanair walked away from the Aer Lingus takeover bid after it was rejected by the Irish Government on the grounds it undervalued the airline and would harm competition.[49] However, Ryanair retained a stake in Aer Lingus; in October 2010, competition regulators in the UK opened an enquiry; there are concerns that Ryanair's stake may lead to a reduction in competition.[50]

2009

On 21 February 2009, Ryanair confirmed they were planning to close all check-in desks by the start of 2010. Michael O'Leary, Ryanair's chief executive said passengers will be able to leave their luggage at a bag drop, but everything else will be done online. This became reality in October 2009.[51]

2010

In February 2010, Michael O'Leary threatened that if London Stansted did not give Ryanair any more low-priced landing fees, the airline would move many of its routes from Stansted to London Gatwick (which provided lower landing offers to the airline) and open a base there, or even pull out entirely from Stansted.[52]

On 28 March 2010, Ryanair announced that the on-board mobile phone service would be temporarily unavailable. Michael O'Leary explained that the contract with OnAir (who provided Ryanair the service) had been terminated after a 13 month proving period. As a result, Ryanair have invited other in-flight communications providers to tender for access to Ryanair's in-flight phone service.[53]

As of February 2010, Ryanair had an average fare of €32. Ryanair stood by that fact that its average fare was less than half of competitor EasyJet's of €66, and therefore called the rival carrier a "high fares" airline.

In April 2010, after a week of flight disruption in Europe caused by the eruption of a volcano in Iceland, Ryanair decided to end refusals to comply with EU regulations which stated they were obliged to reimburse stranded passengers. The company had initially indicated it would only refund the price of unused tickets, but eventually agreed to comply with European Union legislation. However Italian authorities fined Ryanair €3,000,000 for failing to help passengers after cancelling their flights.[54] In a company statement released on 22 April 2010, Ryanair described the regulations as 'unfair'.[55] On 29 April 2010, Ryanair announced the cancellations of all of its routes from Budapest Ferihegy Airport, after talks about decreasing taxes with the airports management failed. Ryanair stated it would have opened 25 new routes from the Hungarian capital, if the taxes had been decreased. As Ferihegy Airport is the only one serving Budapest, the airline is not able to operate from an alternative low cost airport in the surroundings.

In June 2010, Ryanair called for a scrapping of the Irish Government's tourist tax and implied that it was destroying Irish tourism.[56] Ryanair announced being back in the black with a €319m profit.[57] and announced it would be cutting its winter schedule in UK by 16%, blaming the level of UK taxes on air tickets.[58]

Ryanair started flying to Cyprus, Larnaca International Airport in November 2010

In June 2010, an Irish High Court judge said he has been driven to conclude "the truth and Ryanair are uncomfortable bedfellows" in light of Ryanair's conduct in challenging proposed new charges at Dublin airport for the five years up to 2014.[59]

In August 2010, Ryanair held a press conference in Plovdiv and announced its first ever Bulgarian destination connecting Plovdiv with London Stansted. The service is planned to start in November 2010 with two flights weekly.[60]

On the 31 August Ryanair announced that they would be withdrawing all their routes from their smallest base, Belfast City. Chief executive Michael O'Leary said: "While we recognise the right of the government and people of Northern Ireland to subject this small runway extension to an extended planning process, these repeated delays, the reference to a public inquiry, and now the further delay to the public inquiry for spurious noise reasons, shows a lack of willingness on the part of the local authorities to grow and develop traffic, routes, tourism and jobs in Northern Ireland.

"In these circumstances, sadly, we have better alternative airports elsewhere in the UK and Europe, all of whom are willing and able to provide us with the runway infrastructure and low-cost facilities we need in order to operate our lowest fare flights immediately, safely and profitably."

In September 2010, it was announced that Ryanair would be reducing flights from Shannon by 21% to 6 destinations due to rises in airport fees.[61] Ryanair has also announced that starts routes from Larnaca to Brussels South-Charleroi and Girona by the end of the year.

On 23 September 2010 Ryanair announced via its website[62] that it was reducing its thrice daily service from Kerry to Dublin, to a single rotation citing increased charges at Dublin Airport and Air Traffic Control levies. Ryanair alleged the Irish government had not increased the PSO subsidy in compensation. It now refuses the subsidy.

On 30 September 2010 Ryanair announced that it will start flights from Tallinn to 7 destinations in December 2010: Skavsta (near Stockholm), Weeze, Rygge (near Oslo), Dublin, Milano-Bergamo, Edinburgh and Luton.

2011

On 4 January 2011, Ryanair announced that its 2010 traffic grew by 10% from 65 million to over 72 million passengers.[63]

On 21 February 2011 Ryanair announced that it will start flights from Vilnius to 5 destinations in May 2011: Barcelona-Girona, Dublin, London-Stansted, Milan-Bergamo, Rome-Ciampino.[64]

In March 2011, Ryanair opened a new maintenance hangar at Glasgow Prestwick International Airport. Making the Prestwick facilities Ryanair's biggest fleet maintenance base, performing all aircraft checks with the exception of D checks.The new hangar boosts capacity of the established maintenance facilities at the airport from two aircraft, to five. That same month, Ryanair is in breach of European Union rules by not offering an online complaints service to customers, according to the European Commissions European E-commerce Directive, any company selling goods online must offer customers the opportunity to complain via email. Ryanair currently has no email contact listed on its website instead requiring disgruntled customers to contact them by fax, letter or premium rate telephone number for urgent inquiries.

On 23 May 2011, Ryanair announced plans to temporarily cut capacity by grounding 80 aircraft in the winter schedules between November 2011 and April 2012 due to the high cost of fuel and continuing weak economic conditions. However, the airline will take delivery of 25 new aircraft over the coming months, but will not put them into service until April 2012.[65]

On 14 July 2011, it was reported that Ryanair were looking to secure 40 - 50 new aircraft for transatlantic flights. .[66]

Business model

Ryanair Headquarters in Dublin Airport
Boeing 737-200 in 2003

Employment relations

In the early years, when Ryanair had a total of 450 employees who each had shares in the company, there was an agreement that staff would not join a union on the basis that they would have influence on how the company was run.[67] However, there were some early attempts to unionise Ryanair due to Michael O'Leary, board of directors, requesting that pilots take pay cuts and accept changes in their working conditions.[68] Many of Ryanair's pilots were dissatisfied with the new moves and were represented by the Irish Airline Pilots Association. Ryanair's response was to outsource employees from other European countries[citation needed]. Though in later years, CEO Michael O'Leary, took a more hands on approach and could be seen working with other staff members on the front line loading bags and checking passengers.[67]

Ancillary revenue and in-flight service

Twenty percent of Ryanair's revenue is generated from ancillary revenue, that is income from sources other than ticket fares. In 2009 ancillary revenue was at €598 million, compared to a total revenue of €2,942 million.[69]

Ryanair has been described by the consumer magazine, Holiday Which?, as being the "worst offender" for charging for optional extras.[70] As part of the low-cost business model the airline charges fees, these can be related to alternative services like using airport check-in facilities instead of the online service fee and using non-preferred methods of payment. It also charges for extra services like checked in luggage and it offers food and drinks for purchase as part of a buy on board programme.[71] Ryanair argues that it charges for a large number of optional extras in order to allow those passengers who do not require baggage, priority boarding or other premium services to travel for the lowest possible price by giving customers the flexibility to choose what they pay for.

In 2009, Ryanair abolished airport check-in and replaced it with a fast bag drop for those passengers checking in bags.[72] The option of checking in at the airport for €10 has been discontinued, and all passengers are required to check-in online and print their own boarding pass. Passengers arriving at the airport without a pre-printed online check-in will have to pay €40 for their boarding pass to be re-issued. Ryanair has also replaced the free online check-in with a €6 online check-in fee which is charged per person, per flight.[73] Although this fee is waived on "Free", "€1" and "€5" promotional fares, it has been criticised as being a non-optional extra charge which should be included in the headline fare.[74]

No-frills

New Ryanair aircraft have been delivered with non-reclining synthetic leather seats, no seat-back pockets, safety cards stuck on the back of the seats, and life jackets stowed overhead rather than under the seat. This allows the airline to save on aircraft costs and enables faster cleaning and safety checks during the short turnaround times.[75] It was reported in various media that Ryanair wanted to order their aircraft without window shades;[76] however, the new aircraft do have them as it is required by the regulations of the Irish Aviation Authority.

Other proposed measures to reduce frills further have included eliminating two toilets to add six more seats,[77] redesigning the aircraft to allow standing passengers, suggested that passengers should pay to use the toilets,[78] charging extra for overweight passengers,[79] and asking passengers to carry their checked-in luggage to the plane.[80]

In common with other no-frills airlines, Ryanair is a strictly point-to-point carrier and does not offer connecting flights. Passengers who purchase an onward flight from their destination, intending to make a connection, are held responsible for making it to the airport on time for each flight. Ryanair does not compensate passengers who miss their flights because they arrive too late at the airport, nor does it provide replacement tickets free of charge. If a passenger misses their flight, then it is the passenger's responsibility to buy a new ticket at their own expense. This rule applies regardless of the passenger's chosen method of transport to the airport (including another Ryanair flight).[81]

Customer service

A Ryanair Boeing 737-800 departs Birmingham International Airport, England. (2008)

Ryanair has been criticised for many aspects of its customer service. The Economist wrote that Ryanair's "cavalier treatment of passengers" had given Ryanair "a deserved reputation for nastiness" and that the airline "has become a byword for appalling customer service ... and jeering rudeness towards anyone or anything that gets in its way".[82]

In 2002, the High Court in Dublin awarded Jane O'Keefe €67,500 damages and her costs after Ryanair reneged on a free travel prize she was awarded for being the airline's 1 millionth passenger.[83][84]

The airline has come under heavy criticism in the past for its poor treatment of disabled passengers. In 2002, it refused to provide wheelchairs for disabled passengers at London Stansted Airport, greatly angering disabled rights groups.[85] The airline argued that this provision was the responsibility of the airport authority, stating that wheelchairs were provided by 80 of the 84 Ryanair destination airports,[86] at that time. A court ruling in 2004 judged that the responsibility should be shared by the airline and the airport owners;[87] Ryanair responded by adding a surcharge of £0.50 to all its flight prices. On 30 March 2011, it announced that from 4 April it would add a surcharge of €2 to its flights to cover the costs arising from compliance with EC Regulation 261/2004, which requires it to pay for meals and accommodation for passengers on delayed and cancelled flights.[88]

Ryanair does not offer customers the possibility of contacting them by email or webform, only through a premium rate phone line, by fax or by post. An early day motion in the British Parliament put forward in 2006 criticised Ryanair for this reason and called on the company to provide customers with a means to contact the company by email.[89]

Publicity

Controversial advertising

Ryanair's advertising and the antics of Michael O'Leary, such as causing deliberate court controversy in order to generate free publicity for the airline,[90] have led to a number of complaints to the Advertising Standards Authority (ASA) and occasionally court action being taken against the airline.[91][92][93][94]

Another Ryanair tactic is to make deliberately controversial statements to gain media attention. An example of this was the live BBC News interview on 27 February 2009 when Michael O'Leary, observing that it was "a quiet news day", commented that Ryanair was considering charging passengers £1 to use the toilet on their flights. The story subsequently made headlines in the media for several days and drew attention to Ryanair's announcement that it was removing check-in desks from airports and replacing them with online check-in. Eight days later O'Leary eventually admitted that it was a publicity stunt saying "It is not likely to happen, but it makes for interesting and very cheap PR".[95] The concept of Ryanair charging for even this most essential of customer services was foreseen by the spoof news website "The Mardale Times" some five months previously, in their article "Ryanair announce new 'Pay-Per-Poo' service".[96]

'bye bye Latehansa' (referring to Lufthansa) is one of Ryanair's Boeing 737-800s, taken at Girona-Costa Brava Airport, Spain. (2008)

Ryanair often use their advertising to make direct comparisons and attack their competitors. One of their advertisements used a picture of the Manneken Pis, a famous Belgian statue of a urinating child, with the words: "Pissed off with Sabena's high fares? Low fares have arrived in Belgium." Sabena sued and the court ruled that the advertisements were misleading and offensive. Ryanair was ordered to discontinue the advertisements immediately or face fines. Ryanair was also obliged to publish an apology and publish the court decision on their website. Ryanair used the apologies for further advertising, primarily for further price comparisons.[91]

Another deliberately provocative ad campaign headlined "Expensive Bastards!" compared Ryanair with British Airways. As with Sabena, British Airways disagreed with the accompanying price comparisons and brought legal action against Ryanair. However, in this case the High Court sided with Ryanair and threw BA's case out ordering BA to make a payment towards Ryanair's court costs. The judge ruled "The complaint amounts to this: that Ryanair exaggerated in suggesting BA is five times more expensive because BA is only three times more expensive. Accordingly, in my view, the use was honest comparative advertising. I suspect the real reason that BA do not like it is precisely because it is true."[97]

In 2007 Ryanair used an advertisement for its new Belfast route which showed Sinn Féin's Martin McGuinness (an ex-commander in the Provisional IRA) standing alongside Gerry Adams with a speech bubble which said "Ryanair fares are so low even the British Army flew home".[98][99] Ulster Unionists reacted angrily to the advertisement, while the Advertising Standards Authority said it did not believe the ad would cause widespread offence.[100]

Innuendo often features in Ryanair advertisements with one ad featuring a model dressed as a schoolgirl, accompanied by the words "Hottest back to school fares". Ryanair ran the advertisement in two Scottish and one UK-wide newspaper. After receiving 13 complaints, the advertisement was widely reported by national newspapers, generating more free publicity for the airline. The Advertising Standards Authority (ASA) instructed them to withdraw the advert in the United Kingdom, saying that it "appeared to link teenage girls with sexually provocative behaviour and was irresponsible and likely to cause serious or widespread offence". Ryanair said that they would "not be withdrawing this ad" and would "not provide the ASA with any of the undertakings they seek", on the basis that they found it absurd that "a picture of a fully clothed model is now claimed to cause 'serious or widespread offence', when many of the UK's leading daily newspapers regularly run pictures of topless or partially dressed females without causing any serious or widespread offence".[101]

Another incident where it is speculated that Ryanair has used controversial statements for free publicity occurred in November of 2011. The airline has proposed the introduction of pay-per-view porn on its flights, CEO Michael O’Leary revealed to UK newspaper The Sun. O'Leary likened the service to those commonly provided in hotels, saying "Hotels around the world have it, so why wouldn’t we?”. [102]

Allegations of misleading advertising

Boeing 737-200

Ryanair was ordered by the ASA to stop claiming that its flights from London to Brussels are faster than the rail connection Eurostar, on the grounds that the claim was misleading, due to required travel times to the airports mentioned. Ryanair stood by its claims, noting that their flight is shorter than the train trip and that travel time is also required to reach Eurostar's stations.[103][104]

In April 2008, Ryanair faced a probe by the UK Office of Fair Trading, after a string of complaints about its adverts. It was found to have breached advertising rules seven times in two years. ASA's director general Christopher Graham commented that formal referrals to the OFT were rare, the last occurring in 2005. He added that the ASA "would prefer to work with advertisers within the self-regulatory system rather than call in a statutory body, but Ryanair's approach has left us with no option." Ryanair countered with the claim that the ASA had "demonstrated a repeated lack of independence, impartiality and fairness".[105]

In July 2009, Ryanair took a number of steps to "increase the clarity and transparency of its website and other advertising" after reaching an agreement with the OFT. The airline's website now includes a statement that "Fares don't include optional fees/charges" and they now include a table of fees to make fare comparisons easier.[106]

In July 2010 Ryanair once again found itself in controversy regarding alleged misleading advertising. Ryanair circulated advertisements in two newspapers offering £10 one-way fares to European destinations. Following a complaint from rival carrier EasyJet, the ASA ruled the offer was "likely to mislead".[107] Ryanair made no comment on the claim but did hit back at EasyJet, claiming they cared about details in this regard but did not themselves print their on-time statistics. EasyJet denied this.

In April 2011 Ryanair advertised 'a place in the sun destinations' but the advert was banned when it was found that some of the destination experienced sunshine for as little as 3 hours a day and temperatures between 0C and 14C.[108]

Ryanair no longer replies to complaints from the ASA or its Irish equivalent, the ASAI.[109][not in citation given]

Competitors

Passenger numbers. Ryanair carried 58,700,000 passengers in 2008, an 18% increase over 2007

Ryanair now has a number of low-cost competitors. In 2004, approximately 60 new low-cost airlines were formed. Although traditionally a full-service airline, Aer Lingus moved to a low-fares strategy from 2002, leading to a much more intense competition with Ryanair on Irish routes.[110]

Airlines which attempt to compete directly with Ryanair are treated competitively, with Ryanair being accused by some of reducing fares to significantly undercut their competitors. In response to MyTravelLite, who started to compete with Ryanair on the Birmingham to Dublin route in 2003, Ryanair set up competing flights on some of MyTravelLite's routes until they pulled out. Go was another airline which attempted to offer services from Ryanair's base at Dublin to Glasgow and Edinburgh in Scotland. A fierce battle ensued, which ended with Go withdrawing its service from Dublin.[111]

In September 2004, Ryanair's biggest competitor, EasyJet, announced routes to the Republic of Ireland for the first time, beginning with the Cork to London Gatwick route. Until then, EasyJet had never competed directly with Ryanair on its home ground. EasyJet announced in July 2006, that it was withdrawing its Gatwick-Cork, Gatwick-Shannon and Gatwick-Knock services; within two weeks, Ryanair also announced it would withdraw its own service on the Gatwick-Knock and Luton-Shannon routes.[112]

Ryanair has asked the high court to investigate why it has been refused permission to fly from Knock to Dublin. This route was won by CityJet, which was unable to operate the service. The runner up, Aer Arann, was then allowed to start flights, a move Ryanair criticises on the basis that not initiating an additional tender process was unlawful.[113]

DFDS Seaways cited competition from low-cost air services, especially Ryanair, which now flies to Glasgow Prestwick Airport and London Stansted Airport from Gothenburg City Airport, as the reason for scrapping the Newcastle–Gothenburg ferry service in October 2006.[114] It was the only dedicated passenger ferry service between Sweden and the United Kingdom, and had been running under various operators since the 19th century.

Choosing destinations

A Ryanair Boeing 737-200, now retired, at Dublin Airport, Ireland. (2004)

When Ryanair negotiates with its airports, it demands very low landing and handling fees, as well as financial assistance with marketing and promotional campaigns.[115] In subsequent contract renewal negotiations, the airline has been reported to play airports against each other, threatening to withdraw services and deploy the aircraft elsewhere, if the airport does not make further concessions. According to Michael O’Leary's biography "A Life in Full Flight", Ryanair's growing popularity and also growing bargaining power, with both airports and airplane manufacturers, has resulted in the airline being less concerned about a market research/demographics approach to route selection to one based more on experimentation. This means they are more likely to fly their low cost planes between the lowest cost airports in anticipation that their presence alone on that route will be sufficient to create a demand which previously may not have existed, either in whole or in part.[116]

In April 2006, a failure to reach agreement on a new commercial contract resulted in Ryanair announcing that it would withdraw service on the Dublin–Cardiff route at short notice.[117] The airport management rebutted Ryanair's assertion that airport charges were unreasonably high, claiming that the Cardiff charges were already below Ryanair's average and claimed that Ryanair had recently adopted the same negotiating approach with Cork Airport and London Stansted Airports.[118] Ryanair was recently reported to have adopted 'harsh' negotiating with Shannon Airport and is closing 75% of its operations there from April 2010.[119] Ryanair was forced to give up its Rome Ciampino–Alghero route, after the route was allocated to Air One, as a public service obligation (PSO) route. The European Commission is investigating the actions of the Italian Government in assigning PSO routes and thus restricting competition.

Destinations

A Ryanair BAC 1-11 and an Aer Lingus Boeing 737 at Dublin Airport, Ireland in 1993. The two airlines are the largest operators out of Dublin Airport.
A Ryanair Boeing 737-800 and an EasyJet Airbus A319-100 at London Luton Airport, England in 2009. The two airlines are the largest low-cost-carriers in Europe.
Main article: Ryanair destinations

Ryanair's five largest bases in order of size are London-Stansted (more than 120 daily departures), Dublin (more than 70 daily departures), Milan-Bergamo (approximately 70 daily departures), Brussels-Charleroi (between 45 and 50 daily departures) and Alicante (approximately 40 daily departures).[120] Pescara airport is currently the airline's smallest base with approximately five daily departures from the airport. Some non-base airports have more daily departures than some of the base airports. Bratislava, Kraków, Gatwick, Palma de Mallorca and Paris-Beauvais are all non-base airports but have more daily departures than Ryanair's bases at Brindisi, Pescara and Shannon. Some of these non-base airports also serve more destinations than some of the airline's larger bases like Barcelona-Reus, Bremen and Bristol.

Ryanair flies in a point to point model rather than the more traditional airline hub and spoke model where the passengers have to change aircraft in transit at a major airport.[121][122] Ryanair prefers to fly to smaller or secondary airports usually outside of major cities to help the company cut costs and benefit from lower landing fees. For example Ryanair does not fly to the main Düsseldorf airport, it instead flies to Weeze, 70 km from Düsseldorf. Secondary airports are not always far from the city it serves and in fact can be closer than the city's major airport; this is the case at Belfast, Gothenburg and Rome. Ryanair does still serve a number of major airports including Barcelona, Berlin Schönefeld, Dublin, Edinburgh, London-Gatwick, Manchester Airport and Porto although the majority of these cities do not have a secondary airport that Ryanair can use.

Ryanair has 44 European bases. Despite Ryanair's being an Irish airline, and having a significant presence there, it also has a significant presence in France, Germany, Italy, Poland, Spain, the United Kingdom as well as many other European countries (although the airline has no bases in France and Poland). The United Kingdom is its biggest market, containing the airline's largest base and nine others, as well as a total of seven other non-base airports. Its three largest British bases in order of size are London-Stansted, Liverpool and East Midlands airports.

Ryanair's largest competitor is EasyJet, which unlike Ryanair has a focus on larger or primary airports and also heavily targets business passengers. Ryanair in more recent years has focused on sun destinations such as the Canary Islands and Greece. EasyJet often criticises Ryanair for its choice of airports and Ryanair often refers to EasyJet as a high fares airline.

Fleet

A Ryanair Boeing 737-800 taxiing at Manchester Airport.
A Ryanair Boeing 737-800, with the text "Auf Wiedersehen Lufthansa", ("Goodbye, Lufthansa" in German) at Berlin Schönefeld Airport, Germany. (2005)
A Ryanair Boeing 737-800, named Nyköping, takes off from London Luton Airport, England. (2007)

Ryanair claims to operate the newest, greenest and quietest fleet of aircraft in Europe.[123][124] As of 13 July 2011, the average age of the Ryanair fleet is 3.6 years.[125]

Ryanair's fleet reached 200 aircraft for the first time on 5 September 2009.[123][126] The airline is expanding rapidly and will operate a fleet of 292 aircraft by 2012 with options for a further 10 aircraft to be delivered during that time. All aircraft in the Ryanair fleet have been retrofitted with performance enhancing winglets and the more recent deliveries have them fitted as standard.[127]

Ryanair Fleet
Aircraft In Fleet Orders Options Passengers
(Economy)
Boeing 737-800 306[128] Future order by either Boeing, Airbus or Comac[129] 0 189

Future purchases

In 2009, Ryanair announced that they were in talks with Boeing and Airbus about an order, which could include up to 200 aircraft. Even though Ryanair had dealt with Boeing aircraft up to this point, Michael O'Leary said he would buy Airbus planes if they offered a better deal. However, Airbus Chief Commercial Officer John Leahy denied in February 2009 that any negotiations were taking place: "We are not in discussions with Ryanair about aircraft. [...] We don't have plans to enter a sales campaign with Ryanair, which would be very expensive and very time-consuming."[130]

In November 2009, Ryanair announced that negotiations with Boeing had proceeded poorly and that Ryanair was thinking of stopping negotiations, now put at 200 aircraft for delivery between 2013–2016, and simply returning cash to shareholders. Furthermore, if negotiations have not been completed by the end of 2009, Ryanair will start a series of deferrals and cancellations of existing orders, and "end" its relationship with Boeing.[131] Boeing's competitor Airbus was mentioned again as an alternative vendor for Ryanair, but both Michael O'Leary and Airbus CCO John Leahy dismissed this, with Leahy stating "With what I know of the pricing levels they have in mind, I think I can say this is one order that Boeing should win"[132]

In December 2009, Ryanair announced that negotiations with Boeing had indeed failed. Plans were to take all 112 aircraft already on order at that point, with the last deliveries occurring in 2012, for a total fleet of 300. Ryanair confirmed that an agreement had been met on price, but they had failed to agree on conditions, as Ryanair had wanted to carry forward certain conditions from their previous contract. As of late 2009, Ryanair plans to return cash to shareholders after 2012, and has no plans, it states, to reopen negotiations with Boeing or any other air-framer.[133]

In January 2011 it was reported that Ryanair is speaking with Comac of China and United Aircraft Corporation of Russia, saying that these alternative manufactures could be a viable option for Ryanair. Possible candidates may include Comac C919 and Irkut MS-21.[134]

Past fleet

Ryanair has operated the following types of aircraft:

Ryanair Past Fleet[17]
Aircraft Introduced Retired
Embraer EMB 110 Bandeirante 1985 1989
Hawker Siddeley HS 748 1986 1989
BAC One-Eleven 1987 1994
ATR 42 1989 1991
Boeing 737-200 1994 2005

Accidents and incidents

  • On 27 February 2002, Ryanair Flight RYR296 (Boeing 737-800, EI-CSA), from Dublin to London Stansted, was evacuated shortly after landing in Stansted, because airport personnel believed that one of the engines was on fire. The UK Air Accidents Investigation Branch concluded that the release of oil from a broken engine bearing into the path of hot gas had caused the smoke and that there were no signs of fire damage. The investigation also found that although the aircraft was fully evacuated within 90 seconds, some members of the cabin crew struggled to open the emergency doors and had to be assisted by off-duty cabin crew travelling as passengers. Some passengers attempted to evacuate onto the right wing of the aircraft, before being turned back by firefighters. The investigation found that during training, cabin crew were informed that in an emergency, the doors are more difficult to open due to the need to activate the evacuation slides, but the majority of trainees never experienced the pressure needed. The investigation also made several recommendations to the Civil Aviation Authority, on how to better handle similar incidents in the future.[135]
  • On 10 November 2008, Ryanair Flight RYR4102, from Hahn Airport, suffered undercarriage damage in an emergency landing at Rome Ciampino Airport, after experiencing multiple bird strikes, which damaged both engines on approach. The registration number of the aircraft involved was EI-DYG. There were 6 crew members and 166 passengers on board.[136] Two crew members and eight passengers were taken to hospital with minor injuries.[137] The port undercarriage of the Boeing 737-800 collapsed,[138] leaving the aircraft stranded on the runway and closing the airport for over 35 hours.[137] As well as damage to the engines and undercarriage, the rear fuselage was also damaged by contact with the runway.[139] Ryanair thanked the crew of Flight 4102 and praised their skill and professionalism, at a dinner held in Frankfurt.[140] The aircraft involved was damaged beyond repair and has since been scrapped.

See also

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