Ryanair - 6
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Ryanair need to buy an airline that is short of modern planes as quickly as possible. Planes doing nothing still cost. Ryanair will also have to pay for all the new 787s on order but may be unable to sell off its older ones. The cash pile can soon become a hole.
Ryanair need to buy an airline that is short of modern planes as quickly as possible
I know that some routes which were scheduled to launch in mid-October had to be delayed until the S08 schedule ended when some airframes were freed up, but how much has the Boeing strike (and consequent delivery delays) constrained FR's expansion plans for S09 ?
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but how much has the Boeing strike (and consequent delivery delays) constrained FR's expansion plans for S09 ?
The gloss is off the FR story, analysts expect massive losses next year. No wonder micko looks sick.
If you look beyond the propaganda, FR are in deep$hit. So much for my share options
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at only 6 sectors per day that is 20 million more seats to fill next year. Giving away another 20 million free seats is not going to pay to run 50 planes and will undermine the fares paid. In October Uk pax overall were down 5%. Next year you could see a 10-20% drop in flying. That is not the time to have spare capacity.
One could take the cynical view, that 2009 is a great time for price dumping (i.e. selling a product on average at a lower price than the cost of providing it).
If one engages too heavily in price dumping, Govt regulators have a habit of asking questions, imposing penalties and generally turning nasty. A recession provides a perfect excuse for an airline for price dumping
By selling at a price below cost, it would be an easy way to put the weaker LCCs into dire straits - probably not necessary for SkyEurope, but perhaps an effective strategy to kill off Vueling, Clickair (unless bought by Iberia), Helvetic, WindJet, MyAir and a few others.
If one engages too heavily in price dumping, Govt regulators have a habit of asking questions, imposing penalties and generally turning nasty. A recession provides a perfect excuse for an airline for price dumping
By selling at a price below cost, it would be an easy way to put the weaker LCCs into dire straits - probably not necessary for SkyEurope, but perhaps an effective strategy to kill off Vueling, Clickair (unless bought by Iberia), Helvetic, WindJet, MyAir and a few others.
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Let me remind you what Michael O'Leary has said in 2006 (during his interview for The Times):
But no, I do not think it's the right time to replace him, I think MOL is still needed. For two reasons. He is a master in driving the costs down, he is successful in getting good deals. Blackmailing, using opportunities, exploiting, never mind. He is good in it, that's why he's still useful. But what both Ryanair and MOL really need most, is to get a good strategist to change the marketing approach, customer relations and the route development policy. Let O'Leary be the watchman of the cost issues, let him continue as the influential man who arranges new deals and pushes the politicians and bureaucrats to take care of the carrier's prosperity, he's up to the job. But above all he and his airline really need a visionary able to tailor them a new strategy basing not only on low prices, but on the more attractive offer from the pax point of view. The assumption that just low prices will do the trick is simply wrong.
Basically, Ryanair is attracting two groups of passengers. The first one could be a minority, but not a small one. All shades of stingy people. Just they really appreciate these free flights, they do expect all these promotions, some even fly only because it's cheap, for no other reason. They do exist.
The second group is different. The price-conscious people from all social backgrounds, leisure travellers as well as some job-related commuters, students etc. Many could afford paying for much more expensive flights, but don't really see the reason to back less-efective or overcharging carriers. It's a very important group from the airline's point of view. They might be even ready to pay slightly more, but they do not want to hear the slogan: "Don't like us? Travel with others, we don't care". FR simply cannot afford to lose this group of customers. Unfortunately, the only marketing tool Ryanair seem to appreciate so far is just the level of fares. Which of the two mentioned passenger groups are they addressing this way? The right one?
When we’re the biggest airline in Europe it will inappropriate to have somebody here shouting, swearing, abusing the competition. You need more professional management than me. And that time is coming.
Basically, Ryanair is attracting two groups of passengers. The first one could be a minority, but not a small one. All shades of stingy people. Just they really appreciate these free flights, they do expect all these promotions, some even fly only because it's cheap, for no other reason. They do exist.
The second group is different. The price-conscious people from all social backgrounds, leisure travellers as well as some job-related commuters, students etc. Many could afford paying for much more expensive flights, but don't really see the reason to back less-efective or overcharging carriers. It's a very important group from the airline's point of view. They might be even ready to pay slightly more, but they do not want to hear the slogan: "Don't like us? Travel with others, we don't care". FR simply cannot afford to lose this group of customers. Unfortunately, the only marketing tool Ryanair seem to appreciate so far is just the level of fares. Which of the two mentioned passenger groups are they addressing this way? The right one?
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He made these comments (if I remember correctly) when the airline industry was still booming and the new idea of RyanAtlantic was coming to light.
It is without doubt that he is the best in any business at controlling the bottom line and at the moment it is what is needed. If he resigned from Ryanair there would be hundreds of the world biggest companies wanting him in their seat.
He may not be the best for a companies image but again, he is the best at PR in the business.
He is desperately needed at FR over the next 2 years during these challenging times.
Personally, I think the best move for him would be to move into an advisory role for all companies and work with their staffs to reduce costs. He would become the Simon Cowell of the business world - the man everyone looks at.
It is without doubt that he is the best in any business at controlling the bottom line and at the moment it is what is needed. If he resigned from Ryanair there would be hundreds of the world biggest companies wanting him in their seat.
He may not be the best for a companies image but again, he is the best at PR in the business.
He is desperately needed at FR over the next 2 years during these challenging times.
Personally, I think the best move for him would be to move into an advisory role for all companies and work with their staffs to reduce costs. He would become the Simon Cowell of the business world - the man everyone looks at.
eu01 - how does one differentiate between the 2 pax groups that you mentioned ? People who are price conscious are surely by their nature unwilling to spend money unless they see good reason to do so....
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How do I differentiate? Well, do not want to start too artificial classification, but let's try.
The first group: 1 cent flights to Pisa? I've already been to Pisa. Oh, it doesn't matter. The ticket is so cheap that I'll go again.
The second group: 1 cent flights to Pisa? No, I'm not interested in Pisa. I want to go to Paris. Which carrier will offer me the best fares to Paris?
The first group: 1 cent flights to Pisa? I've already been to Pisa. Oh, it doesn't matter. The ticket is so cheap that I'll go again.
The second group: 1 cent flights to Pisa? No, I'm not interested in Pisa. I want to go to Paris. Which carrier will offer me the best fares to Paris?
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From the Spanish press:
Five thousand people booked already, probably paid for the hotels, many will not be able to fly any more... They will obviously remain the faithful Ryanair customers, won't they?
Once again. As long as the pax will not have even the illusory impression they are important for the airline, the load factors will not improve.
La aerolínea de bajo coste Ryanair ha decidido dejar de operar en Fuerteventura a partir del 31 de enero de 2009, lo que ha dejado a 5.000 personas que habían reservado billetes con la aerolínea sin sus vacaciones de invierno.
Once again. As long as the pax will not have even the illusory impression they are important for the airline, the load factors will not improve.
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If you have a contract it is not unreasonable to expect that if you keep to your side of the deal, the other side will honour their part.
If they don't, you can ask them nicely to desist and stick to the deal.
When they continue to ignore your requests and still don't keep to the deal, what do you do?
Do you just carry on regardless or do you back out and seek compensation?
The "bad guys" are AEI not Ryanair.
If they don't, you can ask them nicely to desist and stick to the deal.
When they continue to ignore your requests and still don't keep to the deal, what do you do?
Do you just carry on regardless or do you back out and seek compensation?
The "bad guys" are AEI not Ryanair.
Slim - I understand what you're saying about contract, but in any contract between 2 companies there is likely to be an understanding of a small degree of flexibility. It's much too difficult to draw up a contract which is both legally watertight, and allows for the fact that events may sometimes prevent strict observance of the contract.
An example on the side of the handling agent might be very minor delays (e.g. the occasional minute because there was a flu bug going round and half the staff were sick) for unloading bags. Equally, an airline might be guilty of minor infractions as well for perhaps being a day or two late settling the monthly bills for fuel. Technically any infraction, however minor, still counts as breach of contract for which legal action potentially can be taken - although a court may of course award damages of maybe 1 euro.
Do we have information as to the scale of the alleged breach of contract? Is it one-sided or have both parties performed minor breaches ? Could these minor breaches be simply an excuse for a more significant action on the side of one of the parties involved ?
I don't have the information in this case - but it would be interesting to hear the AEI's side of the story as well before making a judgement.
An example on the side of the handling agent might be very minor delays (e.g. the occasional minute because there was a flu bug going round and half the staff were sick) for unloading bags. Equally, an airline might be guilty of minor infractions as well for perhaps being a day or two late settling the monthly bills for fuel. Technically any infraction, however minor, still counts as breach of contract for which legal action potentially can be taken - although a court may of course award damages of maybe 1 euro.
Do we have information as to the scale of the alleged breach of contract? Is it one-sided or have both parties performed minor breaches ? Could these minor breaches be simply an excuse for a more significant action on the side of one of the parties involved ?
I don't have the information in this case - but it would be interesting to hear the AEI's side of the story as well before making a judgement.
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Five thousand people booked already, probably paid for the hotels, many will not be able to fly any more... They will obviously remain the faithful Ryanair customers, won't they?
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David
I'm certain that the pulling of the routes wasn't done on a whim and that negotiation to retain them was lengthy: if an airport or region doesn't want to accept the conditions of the contract or elects to to apply a variation subsequent to agreeing the contract they have to be pretty sure of their case. The loss of revenue and jobs is severe and any renegotiation is bound to be on even more Draconian terms.
I'm certain that the pulling of the routes wasn't done on a whim and that negotiation to retain them was lengthy: if an airport or region doesn't want to accept the conditions of the contract or elects to to apply a variation subsequent to agreeing the contract they have to be pretty sure of their case. The loss of revenue and jobs is severe and any renegotiation is bound to be on even more Draconian terms.
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If you have a contract it is not unreasonable to expect that if you keep to your side of the deal, the other side will honour their part.
(for the uniniated, FR have consisently ignored contractual agreements with its pilots, a position it is reasonable to assume Slim agrees with, based on previous posts.)
As to FUE, the real reason for this is of course that the routes were loss-making (much like FR as a whole), but better to blame someone else for the problem, backed up by a supine media.
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As to FUE, the real reason for this is of course that the routes were loss-making (much like FR as a whole), but better to blame someone else for the problem, backed up by a supine media.
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Quote :
Basically, Ryanair is attracting two groups of passengers.
some even fly only because it's cheap, for no other reason. They do exist.
Sure ! Some of them have set up the "Ryanair Fan Club" !
Basically, Ryanair is attracting two groups of passengers.
some even fly only because it's cheap, for no other reason. They do exist.
Sure ! Some of them have set up the "Ryanair Fan Club" !
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ryanair bid:have to wonder who fr's advisers are