Ryanair keeps its wheels on the ground

The Irish carrier is mothballing 14 planes at Stansted - more proof of the economy's downward drag.

by
Last Updated: 31 Aug 2010

Rising fuel costs and waning demand have caused a marked change of mood at the group, which tends to react to adversity with studied cockiness. Last winter it grounded seven planes at the airport. This year, however, the turbulence is a lot stronger. Ryanair, which has a fleet of 166 planes, also says it expects its average fare to fall by 5%. 

Ryanair's mood shift has been palpable of late - not only has boss Michael O'Leary been axing routes, but the airline's e-mail marketing has gone into overdrive. We now seem to be getting a dozen a week, offering increasingly unlikely-sounding offers, such as today's free flights ‘with no taxes and no charges'.

How they make a profit on that is anyone's guess. But its grounding tactic is more straightforward, even if a load of 737s does take up a lot of hangar (although they may have got in early enough to nab spaces in the airport's Pink Elephant long-stay car-park). 

By reducing the number of planes in operation, Ryanair ensures that the ones it is flying are well populated, and that its loading factor is high (key to the budget airline model). It's certainly a more logical approach than the one to which Bmi resorted earlier in the year, flying empty planes to keep its slots at Heathrow. It should keep the greens off O'Leary's back for a bit - it's hard to moan about stationary planes.

Ryanair, of course, has plenty of fight left in it, as indicated by its decision to allow passengers to use mobile phones mid-flight, in return for a cut from the calls. Over at Alitalia, meanwhile, the long-slow death of the Italian flag-carrier takes on yet more pathetic dimensions - the airline, which is jettisoning more than EUR2m a day, has placed ads in four papers, including the FT, in a bid to find a buyer. Perhaps it'll be picked up by a bored oligarch seeking a plaything, but it's still an ignominious fall for the Pope's fave airline.

Vito Riggio, the president of the Italian civil aviation authority, says Alitalia is currently flying with a provisional licence. Let's hope that the cost-conscious Ryanair doesn't start employing pilots doing the same.

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