Ryanair

 

Ryanair
IATA FR	ICAO RYR	Callsign RYANAIR
Founded		1985
Focus cities		Dublin International Airport London Stansted Airport Orio al Serio Airport Rome Ciampino Airport Shannon International Airport Pisa Galileo Galilei Airport Frankfurt-Hahn Airport Cork International Airport Liverpool John Lennon Airport London Luton Airport Girona-Costa Brava Airport Stockholm-Skavsta Airport Brussels South Charleroi Airport East Midlands Airport Madrid Barajas International Airport Marseille Provence Airport Glasgow Prestwick Airport Bremen Airport Airport Weeze Bristol Airport Valencia Airport Alicante Airport George Best Belfast City Airport
Fleet size		136 plus 145 on order
Destinations		132
Headquarters		Dublin, Ireland
Key people		Michael O'Leary (CEO) Michael Cawley (Deputy Chief Executive and Chief Operating Officer)
Website: http://www.ryanair.com

Ryanair (ISEQ: RYA, LSE: RYA, NASDAQ: RYAAY) is an Irish airline headquartered in Dublin, with its biggest operational base situated in London Stansted Airport in the UK. It is Europe's largest low-cost carrier and it is one of the world's largest and most successful airlines (whether in terms of profits, number of flights, number of passengers flown). As of 31 July 2007, Ryanair operates 516 routes across 26 countries from 23 bases^[1]. Ryanair has been characterised by rapid expansion, a result of the deregulation of the air industry in Europe in 1997. Over the years, it has evolved into one of the world's most profitable airlines,^[2] running at remarkable margins by passing its costs directly to its customers. Ryanair is the third largest airline in Europe in terms of passenger numbers.^[3]

Ryanair is also one of Europe's most controversial companies, praised by some, criticised by others. Its supporters praise its commitment to low fares, radical management, and its willingness to challenge what it calls the 'establishment' within the airline industry (similar to its American counterpart, Southwest Airlines). Critics, meanwhile, have attacked its trade union policies,^[4] hidden "taxes" and fees, and limited customer services, and charged that it practises deceptive advertising. In October 2006, Ryanair was voted the world's most disliked airline in a survey by the TripAdvisor website, and in November 2006, it was revealed as the subject of more complaints than any other airline in the EU.^[5] The BBC reported that 56% of respondents said Ryanair caused "the biggest headaches" for air travellers in a poll taken in 2003. ^[6] 60% of all complaints to Ireland's Commission for Aviation Regulation were about Ryanair. ^[7] On 22 August 2007 the UK's Advertising Standards Authority upheld a complaint that Ryanair had misled the public in an advert comparing its service from London Stansted to Brussels (in fact to Charleroi) with that of Eurostar. The advert claimed that Ryanair was both quicker and cheaper, whereas the ASA found that Ryanair had not included the time and costs of travel to and from the airports in question in its comparison ^[8]

Financials and history

Financial overview

Ryanair has grown massively 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 taking the rapidly growing airline 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 some €843 million in 2003, and net profits have increased from €48 million to €239 million over the same period. In an industry where the survival rate is 1 in 10 and where even the giants such as American Airlines and Delta struggle to keep in the black, Ryanair's success has confounded many industry analysts. However, it has been consistent with the growth of other no-frills airlines, such as Southwest and JetBlue, since the terrorist attacks in the United States of America on 11 September 2001.

Early years

Ryanair was founded in 1985 by Cathal and Declan Ryan (after whom the company is named), Liam Lonergan (owner of an Irish tour operator named Club Travel), and noted Irish businessman Tony Ryan, founder of Guinness Peat Aviation and father of Cathal and Declan. ^[9] The airline began with a 14 seat Embraer turboprop aircraft flying between Waterford and London Gatwick with the aim of breaking the duopoly on London-Ireland flights at that time held by British Airways and Aer Lingus.

In 1986 the company added a second route – flying Dublin-London Luton in direct competition to the Aer Lingus / BA 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. Ryan encouraged him to visit the USA to study the 'low fares/no frills' model being used by Southwest Airlines. O'Leary quickly learnt 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. O'Leary returned - 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, keen to attract new airlines, which offered lower landing and handling charges than larger established international airports. O'Leary as Chief Executive adopted a hands-on style of management, for example his publicity stunts in helping out with baggage handling on Ryanair flights at Dublin airport. He is said to have a pugnacious and aggressive management style, using a flat management hierarchy. By 1995, after the consistent pursuit of its low-cost business model, Ryanair celebrated its 10th birthday by carrying 2.25 million passengers.

1992 - 1999

EU deregulation of the air industry in Europe in 1992 gave carriers from one EU country the right to operate scheduled services between other EU states, and represented a major opportunity for Ryanair. 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 and Charleroi near Brussels. Flush with new capital, the airline placed a massive $2 billion order for 45 new Boeing 737-800 series aircraft in 1998.

2000

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, and now accounts for 100% of the total.

2001

Ryanair launched a new hub of operation in Brussels South Charleroi Airport in 2001. 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 aeroplane 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.

2002

In 2002 Ryanair launched 26 new routes and established a hub in Frankfurt-Hahn Airport, its European expansion firmly on track.

2003

In 2003, Ryanair announced the order of a further 100 new Boeing 737-800 series aircraft, and in February a third continental base was opened at Milan-Bergamo in Italy.

In April 2003 Ryanair acquired its ailing competitor Buzz from KLM, at a knock-down price. Expansion continued apace with the launch of a base at Stockholm (Skavsta), Sweden. By the end of 2003, the airline flew 127 routes, of which 60 had opened in the previous 12 months.

2004

The airline launched two more bases in the first half of 2004, at Rome (Ciampino) and Barcelona (Girona), increasing the total to 11 hubs. 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. 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 immediately bounced back to ever greater profits afterwards. 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.

2005

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 hubs, others to 10 new hubs the company intended to establish over the next seven years. In an example of the airline's relentless prioritising of cost over all other factors, the aircraft will be delivered without window shades (rumoured in media, although regulations of the Irish Aviation Authority mean that Ryanair's newest airplanes still do contain window blinds), seat back recline and seat back pockets, which result in savings of several hundred thousand dollars per aircraft and give continued savings through reduced cleaning and repair costs. Some slight delays in Boeing airline deliveries in late 2005 (ordered in 2001) were caused by production disruptions arising from a Boeing machinists' strike.

2006

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^[10] 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 (€115.7m) increased by 80% over the same quarter in 2005. Management indicated that this level of growth may not be sustained for the remainder of this year, despite adding 27 new aircraft and opening new routes.

Ryanair's passenger numbers have grown by up to 25% a year for most of the last decade. Carrying under 0.7 million annually in its early years, passenger figures grew to 21.4 million in 2003. The rapid addition of new routes and new hubs has enabled this growth in passenger numbers, and Ryanair is now among the largest carriers on European routes. In August 2004, the airline carried 20% more passengers within Europe than British Airways.

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 22.1m passengers and revenues rose by a third to €1.256 billion^[11]

Aer Lingus takeover bid

On 5 October 2006 Ryanair launched a €1.48bn (£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.

Aer Lingus floated on the Irish Stock Exchange on 2 October 2006 followed 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.^[12] On the same day Aer Lingus rejected Ryanair's takeover bid, saying the bid was contradictory.^[13] With a total of 47% of Aer Lingus in the hands of the Irish Government, the employee share ownership trust, and other entities that have publicly rejected the bid, and a further 4% in the hands of Bank of Ireland and AIB who are considered highly unlikely to sell, the takeover bid is now effectively dead. The Ryanair website describes the attempted take over as, "In October...we make an all cash offer for the small regional airline, Aer Lingus".

2007

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 is now selling on its 737-800s at higher prices than the cost of acquisition from Boeing.^[14]

In January Ryanair conceded, following a BBC investigation, that a claim it had cut its CO2 emissions by half in recent years was "an error".^[15]

In the meantime, Ryanair started its flight operation to the island of Malta, from Dublin, Luton and Pisa. New bases have been created at Bremen (April), Weeze (June), Bristol (November), Alicante, Valencia and Belfast George Best.

In May, Ryanair launched BING^[16]. This application brings daily fare specials to the user's computer. The tool is extremely similar to Southwest's DING^[17], and the frequently asked question section appears to have been plagiarized from Southwest's website.

On 16 May, Ryanair launched a seat sale with fees, taxes and charges waived. A small number of destinations, including Dublin, were offered with 1 million seats for 1 penny or 1 Euro cent. Ryanair's website crashed as it received four million hits from bargain hunters. The sale lasted until the following Monday with just over half a million free seats taken up.

During the weekend of 2 June to 3 June Ryanair's website crashed again for over 48 hours. No explanation or acknowledgement of the problem has been forthcoming from the airline. The problems meant that passengers could not make or check bookings, or use the online check in and other web-based services.

On 18 July The Advertising Standards Agency ordered Ryanair not to repeat a claim that airline industry "accounts for just 2% of carbon dioxide emissions".^[18] 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).

On the 6th of September Ryanair announced that it will establish a 23rd base at George Best Belfast City Airport

In August it 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.^[19]

In October 2007 Ryanair began to decommission some of its older 737-800 series aircraft that were originally purchased in 1998. The aircraft are to be sold off to Brazilian airline Varig. ^{[citation needed]}

New long haul airline

Ryanair's CEO, Michael O'Leary, revealed in April 2007 that individuals involved with Ryanair plan to launch a new long haul airline around 2009 ^[20]. The new airline would be separate from Ryanair and operate under a different branding. It would offer both low cost and a first class service, intended to rival airlines like Virgin Atlantic. The new airline would operate from Ryanair's existing bases in Europe to approximately 6 new bases in the United States. The new American bases will not be main hubs 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 A350 XWB or Boeing 787 aircraft. However, 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. Mr 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 sell tickets through the Ryanair website under an alliance agreement [1].

Criticism and complaints

Main article: Criticism of Ryanair

Ryanair has been heavily criticised throughout the low-cost part of its history for many of its practices.

Competitors

Among Ryanair's main low-cost competitors are easyJet, Monarch Airlines, bmibaby,Centralwings, Air Berlin, Germanwings, Transavia, Jet2, SkyEurope, Vueling, Wizz Air, Flybe, Thomsonfly and TUIfly. In 2004 approximately 60 new low-cost airlines were formed. Despite traditionally being a full-service airline, Aer Lingus moved to a low-fares strategy from 2002, leading to much more intense competition with Ryanair on Irish routes.

Airlines which attempt to compete directly with Ryanair are treated harshly, with Ryanair 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 hub at Dublin to Glasgow and Edinburgh in Scotland. A fierce battle ensued, which ended with Go withdrawing its service from Dublin.^[21]

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.

DFDS Seaways cited competition from low-cost air services, especially Ryanair (which now flies to Glasgow Prestwick and London Stansted from Gothenburg City Airport), as being the reason for its scrapping the Newcastle-Gothenburg ferry service in October 2006.^[22] It was the only dedicated passenger ferry service between Sweden and the United Kingdom, and had been running since the 19th century (under various operators).

Destinations

For the full list of destinations see Ryanair destinations.

Ryanair serves 516 routes from 23 hubs. Its main hub is London Stansted Airport, with 88 routes. Ryanair has other hubs throughout Europe, at Dublin, Brussels South Charleroi Airport, Cork, Frankfurt-Hahn, Nantes Atlantique Airport, Girona, London Luton, Liverpool, Milan Orio al Serio, Pisa, Nottingham East Midlands, Glasgow Prestwick, Rome Ciampino, Shannon, Stockholm Skavsta, Marseille Provence, Madrid Barajas, Bremen and Belfast City. Ryanair have announced three new bases to open in November 2007: Bristol in England, and Alicante and Valencia, both in Spain. Initially Alicante will open as a base with one aircraft on the 13th November expanding to two aircraft on the 5th December, and Valencia will open with 2 aircraft from the 7th of November.

The airline's first new routes outside Europe began in October 2006 when Ryanair planned to begin flying from Frankfurt-Hahn to Marrakech and Fez, both in Morocco. These non-European routes were meant to be further complemented from November 2006 when Ryanair flights were to begin from Marseille to Fez, Marrakech and Oujda (all in Morocco). But, all of these flights (to France and Morocco) were cancelled until further notice on 17 November 2006. Flights were booked for these routes even though an Open Skies agreement was not secured with the EU. Thus, many customers who booked these flights months ahead were forced to cancel or seek a refund. Customers were also forced to call a premium cost customer service telephone line costing more than if they wanted to re-book their flights.

Ryanair also announced it would begin flying 10 other routes from Marseille and that it would make Marseille its 16th operational base, with two Boeing 737-800 to be based there. But as of Novermber 16, 2006, Ryanair has postponed service from Marseille to Morocco until further notice. New flights to Morocco News Release

Of all Ryanair's routes, the Dublin-London city pair remains both the busiest and the most profitable. This is largely due to the number of Irish people who live in the UK, the amount of business between the two cities, and increasingly the number of Irish who use the route to make connecting flights to other points in Europe. In terms of air passenger traffic, London-Dublin is the busiest international city pair in the world after Hong Kong-Taipei.^{[citation needed]}

Ryanair also flies to ten cities in Poland (Bydgoszcz, Gdańsk, Łódź, Katowice, Kraków, Poznań, Rzeszów, Szczecin, Warsaw, Wrocław), and has been a significant facilitator of Polish workforce migration to Ireland (over 200,000 Poles as of 2006) and the UK. Katowice, to be served from Bristol, will be the company's 10th Polish destination from November 2007.

Ryanair negotiates extremely aggressive contracts with its airports, demanding very low landing and handling fees as well as financial assistance with marketing and promotional campaigns. In subsequent contract renewal negotiations, the airline plays airports off against each other, threatening to withdraw services and deploy the aircraft elsewhere if the airport does not make further concessions. 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.^[23] The airport management rebutted Ryanair's assertion that airport charges were unreasonably high, noting that 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 Airport [2].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 currently investigating the actions of the Italian Government in assigning PSO routes and thus restricting competition.In September 2006 it announced new routes including the airline's first to Malta and also to the Canary Islands, which will be among the airline's longest routes.

On October 2nd 2007, Ryanair announced it is launching 70 new routes in October as part of a "massive expansion across Europe."

In 2007 Ryanair inaugurated services to many airports, including:

• Croatia: Dalmatia, Pula
• France: Nice
• Hungary: Budapest
• Italy: Rimini
• Poland: Warsaw
• Poland: Katowice
• Slovenia: Maribor
• Spain: Madrid

Fleet

The Ryanair fleet consists of the following aircraft as of September 2007:^[24][25]

Aircraft	Number in fleet	Seats	Notes
Boeing 737-800	120 (145 on order)	189	171 on order*

As of May 2007 the Ryanair fleet average age was 2.8 years^[26] As of May 2007, all aircraft in the Ryanair fleet have been fitted with performance enhancing Winglets.

• Various Liveries:

Standard new livery: EI-DCB [3]

Standard old livery: EI-CSN [4]

Dreamliner Scheme: EI-DCL [5]

Cable and Wireless: EI-CSC [6]

Pride of Scotland: EI-DAO [7]

Nein Zum Lufthansa Kerosinzuschlag: EI-DAD [8]

Say NO to BA fuel Levy: EI-CTB [9]

Arrivederci Alitalia: EI-CSZ [10]

Bye Bye SkyEurope: EI-DLF [11]

Nyköping: EI-CSV [12]

Catalunya: EI-CSW [13]

Żegnamy PLL LOT: EI-DLG [14]

Bye Bye Easyjet : EI-DLO [15]

Bye Bye Baby : EI-DLN [16]

See also

• Michael O'Leary
• Ryanair Flight 296
• List of airlines
• List of Irish companies
• List of low-cost airlines
• Low-cost carrier

Notes

Further reading

• Creaton, Siobhan (2004). Ryanair: How a Small Irish Airline Conquered Europe. ISBN 1-85410-992-8. 
• Calder, Simon (2002). No Frills: The Truth Behind the Low Cost Revolution in the Skies. ISBN 1-85227-932-X. 
• Guardian Unlimited. Ryanair ... the low-fare airline with the sky-high insurance levy. Retrieved on 2006-05-29.
• Telegraph. Disabled groups attack 33p Ryanair levy. Retrieved on 2006-05-29.
• alfb.net. All we need is low. Ryanair is cheaper as two one-ways than as a return ticket. Retrieved on 2007-10-12.

External links

• Ryanair
• Ryanair's interactive destination map
• Ryanair Fleet
• Ryanair Fleet Age
• Ryanair Fanclub
• Ryanair web page at Flightattitude.com
• The financial operations of Ryanair
• Ryan-Be-Fair a site "giving Ryanair employees a collective voice"
• Photos of Ryanair aircraft
• Ryanair Campaign a site critical of Ryanair's customer service
• Ryanair vs Easyjet Price Comparison
• Ryanair Virtual Airline, approved by Ryanair.

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