Ryanair - 6
Join Date: Aug 2007
Location: NRN
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Today two more aircraft for the NRN Base has been announced. Eleven new destinations starting at the end of October.
Following new destinations:
- Ancona
-Berlin Schönefeld
-Birmingham
-Dublin
-Faro
-Göteborg
-Manchester
-Oslo
-Riga
-Santander
-Teneriffa-Sued
Greets, FR195W
Following new destinations:
- Ancona
-Berlin Schönefeld
-Birmingham
-Dublin
-Faro
-Göteborg
-Manchester
-Oslo
-Riga
-Santander
-Teneriffa-Sued
Greets, FR195W
Join Date: Jun 2001
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O'Leary on the ropes
Looks like the City boys have finally realised they can take whatever comes out of O'Leary's mouth with a pinch of salt. 
Ryanair's fuel fiasco forces new fare gamble - Irish, Business - Independent.ie
RYANAIR is taking a high-stakes gamble to keep low air fares after Michael O'Leary's bet on fuel prices backfired spectacularly.
The airline will cut ticket prices by more than 10pc this winter in a desperate bid to keep passenger numbers up, despite the deepening recession.
It marks a dramatic reversal of strategy at the airline, which just two months ago said it would raise fares by 5pc this year to compensate for record oil prices.
Ryanair now plans to absorb the massive oil rises itself and continue to push fares down. The strategy could mean the airline loses as much as €60m next year.
The stock market reacted with fury to the apparent u-turn, and repaid Ryanair by wiping €1.2bn from the airline's share price in just 10 minutes yesterday.
Analysts who advise investors on their Ryanair holdings were largely unimpressed by the move.
"For them to have changed tack in such a short space of time does create a real crisis of confidence," one of those analysts said. "It looks as if they gave us misleading information in June, and that's not going down well."
One of Europe's most respected aviation analysts, ABN Amro's Andrew Lobbenberg, added that Ryanair's guidance could now be taken "with a pinch of salt".
The airline's latest gamble comes after its punt on fuel spectacularly backfired. The company failed to secure contracts to buy fuel at the $100-mark last year, believing prices would fall. Oil has since topped the $145 mark, leaving Ryanair massively exposed.
It was estimated last night that this cost the company potentially hundreds of millions.
In the three months to June 30 alone, Ryanair's fuel rocketed 93pc to €367m. The airline has now put in place contracts to buy 90pc of its September fuel at $129, and 80pc of fuel for October to November at $124.
Chief executive Michael O'Leary, who saw €54m of his personal wealth evaporate in the stock-market mauling, last night admitted he got it wrong.
"There's no doubt I was overly optimistic two months ago, and, I can promise, you won't see that again while I live and breathe," he said.
Airlines across the world who have been losing passengers to growing economic pressures have responded by raising prices in an attempt to stay afloat.
But Ryanair has opted to go down the opposite route and will instead launch an aggressive new low-fares drive to entice customers. "We did this [massive sales] after 9/11, after the Madrid bombings, after both Gulf wars -- and we're doing it again now," Mr O'Leary added.
"We've been preparing for this downturn for the last 12 months, that's why we've got bundles of cash in the bank."
However, some industry experts last night poured scorn on Ryanair's strategy, insisting the airline needed to "get real" and deal with rising oil prices by raising fares, rather than burning through shareholder cash.
"Ryanair are taking a gamble here alright," Davy's analyst Stephen Furlong said. "The idea is that by keeping up their growth, profits will eventually come back to where they were.
"That can only happen if oil falls, or if competitors go bust and it becomes 'last man standing'.
"In the long term, I think it's the correct strategy, but it doesn't work well in the short-term."
Ryanair's Europewide price slashing will kick off in the coming weeks, with massive sales promised by the airline.
Deputy chief executive Michael Cawley told the Irish Independent that as many as 20pc of all Ryanair seats could be "free" this winter, up from between 10 and 12pc last year.
Record numbers of seats will also have taxes and charges subsidised, he added. To keep costs down, Ryanair is also planning to trial its first "baggage-free" flights.
- Laura Noonan
The airline will cut ticket prices by more than 10pc this winter in a desperate bid to keep passenger numbers up, despite the deepening recession.
It marks a dramatic reversal of strategy at the airline, which just two months ago said it would raise fares by 5pc this year to compensate for record oil prices.
Ryanair now plans to absorb the massive oil rises itself and continue to push fares down. The strategy could mean the airline loses as much as €60m next year.
The stock market reacted with fury to the apparent u-turn, and repaid Ryanair by wiping €1.2bn from the airline's share price in just 10 minutes yesterday.
Analysts who advise investors on their Ryanair holdings were largely unimpressed by the move.
"For them to have changed tack in such a short space of time does create a real crisis of confidence," one of those analysts said. "It looks as if they gave us misleading information in June, and that's not going down well."
One of Europe's most respected aviation analysts, ABN Amro's Andrew Lobbenberg, added that Ryanair's guidance could now be taken "with a pinch of salt".
The airline's latest gamble comes after its punt on fuel spectacularly backfired. The company failed to secure contracts to buy fuel at the $100-mark last year, believing prices would fall. Oil has since topped the $145 mark, leaving Ryanair massively exposed.
It was estimated last night that this cost the company potentially hundreds of millions.
In the three months to June 30 alone, Ryanair's fuel rocketed 93pc to €367m. The airline has now put in place contracts to buy 90pc of its September fuel at $129, and 80pc of fuel for October to November at $124.
Chief executive Michael O'Leary, who saw €54m of his personal wealth evaporate in the stock-market mauling, last night admitted he got it wrong.
"There's no doubt I was overly optimistic two months ago, and, I can promise, you won't see that again while I live and breathe," he said.
Airlines across the world who have been losing passengers to growing economic pressures have responded by raising prices in an attempt to stay afloat.
But Ryanair has opted to go down the opposite route and will instead launch an aggressive new low-fares drive to entice customers. "We did this [massive sales] after 9/11, after the Madrid bombings, after both Gulf wars -- and we're doing it again now," Mr O'Leary added.
"We've been preparing for this downturn for the last 12 months, that's why we've got bundles of cash in the bank."
However, some industry experts last night poured scorn on Ryanair's strategy, insisting the airline needed to "get real" and deal with rising oil prices by raising fares, rather than burning through shareholder cash.
"Ryanair are taking a gamble here alright," Davy's analyst Stephen Furlong said. "The idea is that by keeping up their growth, profits will eventually come back to where they were.
"That can only happen if oil falls, or if competitors go bust and it becomes 'last man standing'.
"In the long term, I think it's the correct strategy, but it doesn't work well in the short-term."
Ryanair's Europewide price slashing will kick off in the coming weeks, with massive sales promised by the airline.
Deputy chief executive Michael Cawley told the Irish Independent that as many as 20pc of all Ryanair seats could be "free" this winter, up from between 10 and 12pc last year.
Record numbers of seats will also have taxes and charges subsidised, he added. To keep costs down, Ryanair is also planning to trial its first "baggage-free" flights.
- Laura Noonan
Ryanair's fuel fiasco forces new fare gamble - Irish, Business - Independent.ie
Join Date: Mar 2006
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They´ve no choice. If Ancillary income forms 20+% of your revenues and even more of your profit then you have to keep the pax numbers up whatever way you can...
... Just suprised MOL hasn´t put a positive spin on things somehow
... Just suprised MOL hasn´t put a positive spin on things somehow
Ecce Homo! Loquitur...
Maybe he already has. Evening Standard: Ryanair's gamble may not be so crazy after all.
Join Date: Oct 2007
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If people in the "City" are critical of Ryanair's tactics, I think that gives me sufficient reason to side with MOL. Remember, these are, collectively, the people who have brought our economies to the edge of recession through their wreckless behaviour (for which some of them gained handsome bonuses, which they won't, presumably, pay back now the true value of the deals they negotiated has emerged). They seem, in part, too, to be responsible for the high cost of aviation fuel. Stick to your guns, Michael!
. Remember, these are, collectively, the people who have brought our economies to the edge of recession through their wreckless behaviour (for which some of them gained handsome bonuses, which they won't, presumably, pay back now the true value of the deals they negotiated has emerged). They seem, in part, too, to be responsible for the high cost of aviation fuel. Stick to your guns, Michael!
Join Date: Jul 2007
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Of course he will can see it already...
RyanAir the only airline cutting cost to help you the cash strapped public.
Whats next he'll be asking for customer loyalty .
RyanAir the only airline cutting cost to help you the cash strapped public.
Whats next he'll be asking for customer loyalty .
Per Ardua ad Astraeus
Join Date: Mar 2000
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I'm sure MOL can ride the nervous twitches of the City 'Red-Braces' panickers.
As ORAC's link says, every pax RYR carry on route with any competition is one less fare for the competition. QED.
As ORAC's link says, every pax RYR carry on route with any competition is one less fare for the competition. QED.
Join Date: Dec 2007
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Regardless of our love/loathing relationship with MOL he has proven his business acumen time and time again. Southwest's Herb is another guy who has ridden storms that have killed off the majors.
The business model is fundamentally sound and FR is one airline with enough "fat" to see off the worst winter cold spells that could be thrown at them.
Did MOL make a mistake? Sure. Will it sink FR? Doubt it. Will FR come out of this in a better position than the rest of the pack? Almost certainly!
My only worry is when they will try to pinch just that little bit more from the crews who already have been whittled down to the bone.
As for the shares, MOL can prop almost anything up with his spin - come to think about it, maybe he should get a job with New Labour when he eventually steps down. lets face it, they need someone like him!!
The business model is fundamentally sound and FR is one airline with enough "fat" to see off the worst winter cold spells that could be thrown at them.
Did MOL make a mistake? Sure. Will it sink FR? Doubt it. Will FR come out of this in a better position than the rest of the pack? Almost certainly!
My only worry is when they will try to pinch just that little bit more from the crews who already have been whittled down to the bone.
As for the shares, MOL can prop almost anything up with his spin - come to think about it, maybe he should get a job with New Labour when he eventually steps down. lets face it, they need someone like him!!
Join Date: Jun 2001
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So oil is at $125 a barrel, and O'Leary wants to charge 5 quid a seat to Paris over the winter?? Sure he'll stimulate demand, fill the B738 with opportunists who wouldn't normally travel that day. But he won't cover his operating costs. So thats his Masterplan????? 
BA , Air France etc can still charge a premium which will go further to covering their trip fuel costs, a B737 with a biz cabin has the same fuel bill as a B737 with 5 quid seats with no pockets.
O'Leary is now huffing he will just burn through his cash pile and wait for all the others to go bust, that certainly is a BIG gamble!!! Not for me!!
BA , Air France etc can still charge a premium which will go further to covering their trip fuel costs, a B737 with a biz cabin has the same fuel bill as a B737 with 5 quid seats with no pockets.
O'Leary is now huffing he will just burn through his cash pile and wait for all the others to go bust, that certainly is a BIG gamble!!! Not for me!!
Join Date: Dec 2007
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Silver Tongued Cavalier
You are missing the point that MOL & co know the cost base VERY well (with one obvious exception). .... thus they know how much each sector will cost.
Yield management is used to get a return from that flight. FR can afford to do that for a long time at marginal profit or possible marginal loss. Either way, it is FR that will come out on top - they have reserves that other just dont.
Yield management is used to get a return from that flight. FR can afford to do that for a long time at marginal profit or possible marginal loss. Either way, it is FR that will come out on top - they have reserves that other just dont.
Join Date: Aug 2007
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Ryanair must have sorted the problems they had with Weeze Airport for them to get 2 new aircraft...or as mentioned previously they need airports to take their new aircraft.
Dublin will be interesting with Aerlingus into Düsseldorf - I thought this route would have come much sooner.
Dublin will be interesting with Aerlingus into Düsseldorf - I thought this route would have come much sooner.
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R IXray you have it one.....MO'L and his hench men I believe made a balls of their fuel policy. Also they have put themselves into a corner re we will never charge fuel surcharges.....I believe thes times as against post 911 the stakes are so much higher and when you have the city boys off side it make things harder. The one thing that has shafted their share price is the short sellers that are making a kings ransom. They knew they were going short no matter. I think and lets try and park the MO'L issue, the company will come out of this. How strong they are in 5 years time will be interesting. If they are hurdling from crisis to crisis then its game over.....I think now is the making of them and let no one doubt how valuable their 30% stake in Aer Lingus is......I note BA/Iberia are talking. Consolodation is kicking off. Another concern is the constant arrival of new aircraft.
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MOL may be able to fill plane by running them at a massive loss but at some point they will need to make a profit again. As soon as they charge £50 each way the pax numbers will drop off. Oil is never going to be $20/barrel and you have got to charge a fare price to make a profit. MOL is killing all the airlines.
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think now is the making of them and let no one doubt how valuable their 30% stake in Aer Lingus is
Share Price€ 2.45 Change Today-€ 0.0652 Week High€ 5.7752 Week Low€ 2.38
Last edited by Lord Lardy; 29th Jul 2008 at 14:13.
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Bet his crews who participate in the company share scheme are absolutely chuffed to bits to see their fortunes get p***ed up the wall by Micky Mouth.
Be interesting to see how he manages to fill seats when his workforce head out the door.
Looks like his long-promised bloodbath is going to be a little closer to home than he expected.
Be interesting to see how he manages to fill seats when his workforce head out the door.
Looks like his long-promised bloodbath is going to be a little closer to home than he expected.
Oil price in 6 months? Who knows.
It is still FAR, FAR to early to say whether RYR was right to hedge or not. If prices retreat below $100 per barrel then it will be seen as an act of genius. If it returns to above $140 then it will seriously hurt. Yes they have experienced a drop off in margin due to the high fuel price, please highlight one airline that has not in the current environment.
Remember, that airlines who hedge by signing future price contracts will be bound into purchasing that fuel at the agreed price even if the price goes below the agreed price (unless of course they stump up cash now to buy options).
JAS
It is still FAR, FAR to early to say whether RYR was right to hedge or not. If prices retreat below $100 per barrel then it will be seen as an act of genius. If it returns to above $140 then it will seriously hurt. Yes they have experienced a drop off in margin due to the high fuel price, please highlight one airline that has not in the current environment.
Remember, that airlines who hedge by signing future price contracts will be bound into purchasing that fuel at the agreed price even if the price goes below the agreed price (unless of course they stump up cash now to buy options).
JAS
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Booking System Temporarily Unavailable
The Ryanair.com booking system is currently unavailable due to essential system maintenance.
We apologise for the inconvenience caused by this temporary system outage
Edit
Shshsh... now the page is trying to show taxes as well
Second edit
Nope, the task of showing fees and taxes appears to be absolutely too ambicious. Now the booking system is completely jammed again...
An Error Has Occurred
An error condition exists which is preventing you from continuing. You may wish to start over and try again.
If you continue to get this error message, please contact the airline.
An error condition exists which is preventing you from continuing. You may wish to start over and try again.
If you continue to get this error message, please contact the airline.
Last edited by eu01; 29th Jul 2008 at 16:55.
He's trying to buy loyalty by selling seats off cheap and losing money in the process.
What he's going to do is lose money. 100% of an unprofitable market isn't a sensible plan.
What he's going to do is lose money. 100% of an unprofitable market isn't a sensible plan.
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Silver Tongued Cavalier exactly it's really a great strategy.
You seem a bit lost, I will explain you something.
For the moment there is an average of 10 passengers by flight not showing up at the airport, mostly those pax never reclaim the tax that they have paid(+- 15 €) but at the same time Ryanair doesn't have to pay those tax to the airport so it's directly in there pocket.
Yeah ok on one flight it's only 150 € but if you multiply by the number of Fr flight by day (1000) it's becoming more interesting : 150.000 €, in one year more than 50,000,000 €.
So here is the point, if the ticket is really cheap people don't care not to show up at the airport( I am pretty sure that a lot of persons here already took a Fr ticket without showing up, for my part 5 times) but if you raised the price everybody will show up because they don't want to loose 100 €.
So in conclusion cheap ticket --> flight revenue just enough to pay the fuel but ancillary revenue with a lot of zeros.
Expensive ticket -- >flight revenue bellow the fuel bill and no ancillary revenue.
I hope it's help you to understand the strategy Silver Tongued Cavalier.
Have a good evening.
You seem a bit lost, I will explain you something.
For the moment there is an average of 10 passengers by flight not showing up at the airport, mostly those pax never reclaim the tax that they have paid(+- 15 €) but at the same time Ryanair doesn't have to pay those tax to the airport so it's directly in there pocket.
Yeah ok on one flight it's only 150 € but if you multiply by the number of Fr flight by day (1000) it's becoming more interesting : 150.000 €, in one year more than 50,000,000 €.
So here is the point, if the ticket is really cheap people don't care not to show up at the airport( I am pretty sure that a lot of persons here already took a Fr ticket without showing up, for my part 5 times) but if you raised the price everybody will show up because they don't want to loose 100 €.
So in conclusion cheap ticket --> flight revenue just enough to pay the fuel but ancillary revenue with a lot of zeros.
Expensive ticket -- >flight revenue bellow the fuel bill and no ancillary revenue.
I hope it's help you to understand the strategy Silver Tongued Cavalier.
Have a good evening.