DALLAS – Michael O’Leary, the somewhat outspoken boss of Europe’s biggest low-cost airline Ryanair (FR), has said that the era of €10 fares to Europe is now over, with soaring fuel prices set to see ticket prices rise.
Mr. O’Leary was interviewed on BBC Radio 4‘s Today Programme, on which he said that he expects the airline’s average fare to rise from around €40 (US$41.34) in 2021 to roughly €50 in the next five years.
“There’s no doubt that at the lower end of the marketplace, our really cheap promotional fares—the one euro fares, the €0.99 fares, even the €9.99 fares—I think you will not see those fares for the next number of years,” he said.
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Price Sensitive Passengers
As fuel prices rise, the cost of living is also eating into many households’ disposable incomes and causing concern for many. But O’Leary does not believe this will affect passenger numbers but rather the choices passengers will make when choosing which airline to fly.
“We think people will continue to fly frequently. But I think people are going to become much more price sensitive, and therefore my view of life is that people will trade down in their many millions,” he explained to the broadcaster.
Coping With Travel Chaos
While Ryanair has not been immune to the travel chaos of recent months, it has faired better than other carriers. Mr. O’Leary said that this was because they had been “part lucky and part brave” after hiring new cabin crew and pilots in November last year in preparation for this summer.
He also spoke about the industry’s current pressures over its environmental impact. Ryanair is currently investing in more fuel-efficient aircraft, replacing its older Boeing 737-800s with the 737- 8200, which has 197 still on order. But he said that the intense focus on aviation was “misplaced” and that road and shipping transportation had a more significant impact on CO2 emissions.
Featured Image: Ryanair became the launch customer of the 737-8200 when it placed an order for 200 in December 2014. Photo: Brandon Farris/Airways