The Company That Consumers Are Flocking To Find Affordable Plane Tickets
In an economy reeling from inflation European residents are relying on Ryanair to nab affordable plane tickets
As the economy worsens, travelers have started looking for more economical options to help them reach their destinations. But most airlines have sky-high costs that come with outrageous fees. However, one airline is making the news for its enormous success in an otherwise struggling industry – Ryanair.
While Europeans and UK citizens are familiar with Ryanair, those on the other side of the pond may not have heard of it. Ryanair was founded in 1984 in Ireland. And it made a name for itself for being ultra-low-cost.
According to CNN, “Ryanair has emerged from the coronavirus pandemic stronger than ever, even as several of its competitors went bankrupt or needed government-backed bailouts. It was also able to avoid the staff shortages that plagued many of its rivals over the summer, including budget airline EasyJet.” That success is thanks to the millions of customers who turned to the budget airline in recent months.
Over the summer, it carried a record number of passengers and believes it will continue to see growth as Europe falls into a recession. The airline expects to carry up to 168 million passengers over the next 12 months. That is a 13% growth over pre-pandemic travel.
Ryanair also posted its highest mid-year profit on Monday. Between April and September, it earned €1.37 billion ($1.36 billion). That far surpassed the previous record from 2019, which was €1.15 billion ($1.14 billion).
And the good news did not stop there for the budget airline. After Monday’s earning announcement, Ryanair stock jumped 3.7%. On top of that, the record earnings brought good news to the company’s employees.
Over the pandemic, Ryanair went through a series of pay cuts for its cabin crew and pilots. The airline’s recently generated revenue allowed it to reverse those pay cuts 28 months ahead of schedule for 90% of its employees. This move puts them on a much better footing than most airlines.
It should lead to continued growth for Ryanair. And the CEO, Michael O’Leary, expects nothing less. In a video posted to the company’s website, he said, “millions of passengers are switching to flying Ryanair and we suspect that will continue.”
“People don’t stop flying during recessions, but they become much more price sensitive… Ryanair grows more strongly in a recession because we have a huge cost advantage over our competitors, that cost advantage is widening, and people becoming more price sensitive turn to us,” he continued. In his mind, only one potential hiccup stands in the way of the company’s success. And that are the struggles Boeing is currently experiencing.
Ryanair ordered 51 “Gamechanger” 737 aircraft from the manufacturer. Those planes should arrive before next summer’s heavy travel season. However, O’Leary is concerned about a likely shipment delay.
He is less than pleased with Boeing’s manufacturing delays. Earlier this year, O’Leary even described Boeing’s management as “headless chickens.” Whether or not that will get him his planes faster will remain to be seen.
But one thing is certain. O’Leary’s strong words and sharp criticism draw attention to the fact that issues in the airline industry do not just occur with the airlines. Airlines cannot do their job without functioning planes.
