O'Leary suggests Jet2 and Globespan will go bust
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O'Leary suggests Jet2 and Globespan will go bust
On UK Channel 4 7pm news today, O'Leary, Ryanairs mouthy boss, announced that Jet2 and Globespan ''will go bust'' this winter. I hope he gets sued for the comment. Mind you he would love the publicity. There must be a law against damaging the reputation of a competitor.
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Jet2 and GSM will still be here next year. LS have a notice on their website from their Chairman telling Mr O'Leary that Jet2 have all their fuel hedged through to S09.
GSM have got lucrative, cash-rich, leases for W08 and S08 which will bring in plenty of cash to keep the airline afloat. TD is not a silly businessman, he is shrewd. GSM have most of their S08 fuel hedged too. O' Leary is just trying to divert the bad publicity away from FR after their results were issued today with a stark warning that FR may only break-even next year, which is a big drop from €409m profit this year.
GSM have got lucrative, cash-rich, leases for W08 and S08 which will bring in plenty of cash to keep the airline afloat. TD is not a silly businessman, he is shrewd. GSM have most of their S08 fuel hedged too. O' Leary is just trying to divert the bad publicity away from FR after their results were issued today with a stark warning that FR may only break-even next year, which is a big drop from €409m profit this year.
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Although I do agree that MOL is a mouthpiece, I also agree that his comments regarding 'said airlines' are not too far from reality...
If BA are considering parking parts of the B737 fleet as are Ryanair, then God help the smaller guys who dont have the 'cushion' of having mega-bucks behind them...
Not that I want to see the smaller guys go under, but economics determine the viability of a company and right now, fuel is a major concearn for all...
If BA are considering parking parts of the B737 fleet as are Ryanair, then God help the smaller guys who dont have the 'cushion' of having mega-bucks behind them...
Not that I want to see the smaller guys go under, but economics determine the viability of a company and right now, fuel is a major concearn for all...
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I don't think GSM will go bust just yet. Although there was a huge loss last year, the company still has some solid business this year to help with their recovery. Loads are good so far.
However, if GSM experience any sort of re-run of last year then the loyal customers who put last year down to a "blip" may well leave. GSM will then be in a lot of trouble. This summer and winter season is crucial.
However, if GSM experience any sort of re-run of last year then the loyal customers who put last year down to a "blip" may well leave. GSM will then be in a lot of trouble. This summer and winter season is crucial.
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If people don't pay for tickets because they are worried that the airline may fold then they might actually go bust. In this respect, MOL will have achieved his aim
.
Similar to the interview with CC from CTC in Pilot magazine forecasting a massive shortage of pilots. The aim to get more people through his school to get into the promised land beyond.
As our CEO knows, it's all about managing expectations.
. Similar to the interview with CC from CTC in Pilot magazine forecasting a massive shortage of pilots. The aim to get more people through his school to get into the promised land beyond.
As our CEO knows, it's all about managing expectations.
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MOL's not completely out of touch with reality at all, but he's been uncharacteristically very naive with these comments. Not because he's necessarily wrong, but it's just unprofessional and it shows he's bothered by the competition, even if they're only small fry.
But his big goof was to undermine the viability of competitors on the grounds he did. It merely causes consumers to question their faith in the whole lo-co industry, potentially making them wary of buying tickets with any of the budget airlines.
I'm Joe Public and I'm definitely more cautious about buying tickets with any of them at the moment. What MOL said today set a few more alarm bells ringing.
Ryanair aren't immune from the concerns MOL clearly has about the industry at present. Au contraire - as a major player, they'll feel any adverse consumer reaction harder than most, in the some way they reap the rewards of positive consumer responses.
He needs to keep his gob shut. For his own good.
But his big goof was to undermine the viability of competitors on the grounds he did. It merely causes consumers to question their faith in the whole lo-co industry, potentially making them wary of buying tickets with any of the budget airlines.
I'm Joe Public and I'm definitely more cautious about buying tickets with any of them at the moment. What MOL said today set a few more alarm bells ringing.
Ryanair aren't immune from the concerns MOL clearly has about the industry at present. Au contraire - as a major player, they'll feel any adverse consumer reaction harder than most, in the some way they reap the rewards of positive consumer responses.
He needs to keep his gob shut. For his own good.
Last edited by harrogate; 3rd Jun 2008 at 20:53.
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GSM had a bad year in 2007, but the good thing is that they have learnt. TD has realised that the airline side of the business (remember this is not the only business that GSM have, they own hotels, travel agents, property, etc) needs proper management to manage and has employed a CEO, and Engineering Director, etc, to manage the change currently experienced at GSM. If TD had thought the airline was not worth investing more money in, he'd simply have called it a day the end of S07.
Loads are up, flights are near the high 90% on lots of flights and most are full to capacity. Winter was no exception. W08 is heavily reduced as GSMs fleet will be reduced with the disposal of the B733s and B736s, leaving only B73Gs and B738s. Just hope that the S08 flights are going to schedule and no interruption to the SH A/C to rescue the LH like last year.
Loads are up, flights are near the high 90% on lots of flights and most are full to capacity. Winter was no exception. W08 is heavily reduced as GSMs fleet will be reduced with the disposal of the B733s and B736s, leaving only B73Gs and B738s. Just hope that the S08 flights are going to schedule and no interruption to the SH A/C to rescue the LH like last year.
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Think I'll listen to MOL's exact comments before judging him. What I do know is that he is very shrewd and although he spouts out the odd rediculous comment, people do sit up and take notice of what he says. One thing's for sure - it is going to be very stressful times for the airline industry and there will be further casualties in some form or other. Nobody can afford to be complacent and think that hedging or aircraft lease will fully protect them.
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Lets face it
The truth hurts, alot of people hate MOL but you have to admit
the man knows what he is talking about.
I dont wish any airline to go bust, some will and MOL has a better
understanding of the situation than many people on this site.
the man knows what he is talking about.
I dont wish any airline to go bust, some will and MOL has a better
understanding of the situation than many people on this site.
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people do sit up and take notice of what he says.
Doesn't fill you with confidence in any of them does it? I've witnessed first-hand today the effect this kind of spouting has, with my two of my colleagues seriously re-thinking booking an Autumn break they've been wittering on about for weeks.
People aren't as loyal to airlines as some of these execs would like to think. Most people don't give a sh*t about which lo-co they fly with, so long as they can fly where they want to at a decent price. The vast majority of people don't have a favourite budget airline.
A better PR mind wouldn't have said what MOL did. His militant side isn't always a good trait. It is sometimes, but not on this occasion. He needs to find a way to spin some semblance of confidence into the situation, while everyone else in the industry is preaching doom and gloom. Instead he's handed it to Meeson to inject some positivity, which he duly did, to be completely fair to the chap.
In the war of words at least, it's Jet2 1 - Ryanair 0.
The truth hurts, alot of people hate MOL but you have to admit
the man knows what he is talking about.
I dont wish any airline to go bust, some will and MOL has a better
understanding of the situation than many people on this site.
the man knows what he is talking about.
I dont wish any airline to go bust, some will and MOL has a better
understanding of the situation than many people on this site.
To put it another way, there is an American businessman's quote somewhere in print to the effect that "If I noticed one of my competitors out of their depth and drowning, I'd try to ram a firehose down their throat and turn it full on." That's all Mr. O'Leary is trying to do.
Then there is the little matter of projection. People have a habit of projecting their own failings onto others. Exactly how sound is Ryanair? And please don't tell me about the mountains of cash, it's the difference between total assets and total liabilities, both of which are non-cash, that count.
In my opinion, what you are seeing is the MOL master plan unravelling.
This plan was:
1. Undercut all competitors by selling core product at less than cost of production.
2. Drive competitors out of business.
3. Raise prices in the absence of competition.
4. Profit.
Again, in my uninformed opinion, if oil prices remain high, then the chav's and chavettes won't be flying much. Aviation will once again be the province of the carriage trade who demand certain levels of service and decorum, which MOL is constitutionally unable to provide.
Just my two cents worth...
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harrogate. Location: Leeds
Jet2: Leeds/Bradford.
What a coincidence.
I bet he wouldn't care if SkyEurope - an airline that'll almost certainly be gone within a year - was mentioned rather than Jet2.
Jet2: Leeds/Bradford.
What a coincidence.
I bet he wouldn't care if SkyEurope - an airline that'll almost certainly be gone within a year - was mentioned rather than Jet2.
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harrogate. Location: Leeds
Jet2: Leeds/Bradford.
What a coincidence.
I bet he wouldn't care if SkyEurope - an airline that'll almost certainly be gone within a year - was mentioned rather than Jet2.
Jet2: Leeds/Bradford.
What a coincidence.
I bet he wouldn't care if SkyEurope - an airline that'll almost certainly be gone within a year - was mentioned rather than Jet2.
Harrogate proves a great point that MOL went shouting his gob off saying that Jet2 abd Globesapn will go bust, he didnt think of the responses that he would get! Phillip Meeson made a cracking reply which puts Jet2 in a very strong position as even the average joe public knows that comments like MOL's are for publicity and the fact that PM has a subtle response which is much more effective than shouting absoloute rubbish on national TV......
.... altough i may just think that because im from near Leeds too ......
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I know MOL has got a reputation for taking an aggressive public stance but he runs a successful airline whatever one may say. In respect of his statement concerning Jet2 and Globespan I hardly think they are a thorn in his side on many routes.
Globespan would have been in a stronger position to weather the storm if TD had placed the airline under a proper management footing in the first place.
They have lurched from one crisis to another since their conception.
I wish neither Globespan or Jet2 to fail but there is not enough room in the current market place for them to survive longterm , and I think MOL will regrettably be proved right in his statement.
Globespan would have been in a stronger position to weather the storm if TD had placed the airline under a proper management footing in the first place.
They have lurched from one crisis to another since their conception.
I wish neither Globespan or Jet2 to fail but there is not enough room in the current market place for them to survive longterm , and I think MOL will regrettably be proved right in his statement.
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The great MO'L dropped a bo??ock hedging his fuel this year and getting bitten rather badly.
Don't expect great profits at Ryanair this year.
Pre-emptive attention deflecting strike?
Love him or hate him he's interesting (and successful).
I'm intrigued how airlines and airports have "fan bases" like football teams do with the appropriate impact on objectivity.
Don't expect great profits at Ryanair this year.
Pre-emptive attention deflecting strike?
Love him or hate him he's interesting (and successful).
I'm intrigued how airlines and airports have "fan bases" like football teams do with the appropriate impact on objectivity.
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WHY DID HE PARK HALF HIS AIRCRAFT UP DURING THE WINTER?
MOL says 20% of FR aircraft parked up for winter....
20% of 168???
Anyone care to share?
MOL TALKS UTTER SH8T ..LETS BE HONEST..
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R5 today ran a broadcast and the 'analysts' predicted a gloomy outlook for short haul UK carriers. If this turns into a bloodbath and survival of the fittest, it will be those with the deepest pockets allied to the best control of costs that see it through. Cash is king.
Whatever you say about the man, MOL is an astute business leader with a sharp eye on the cost base of his company. His profits are made from tightly managing this cost base and he is going to be a fiercesome competitor to have for the next 6 months. His sounding out this week is akin to "ding ding Round 1". If Ryanair are predicting flat margins for the immediate future, then someone(s) will catch a cold and he's already looking at bayoneting what he perceives to be the weaker sisters.
It was also interesting to see MOL seeking European bases of his airline to share in the financial pain. Can some airports survive at their current stature without supporting his request ?
Whatever you say about the man, MOL is an astute business leader with a sharp eye on the cost base of his company. His profits are made from tightly managing this cost base and he is going to be a fiercesome competitor to have for the next 6 months. His sounding out this week is akin to "ding ding Round 1". If Ryanair are predicting flat margins for the immediate future, then someone(s) will catch a cold and he's already looking at bayoneting what he perceives to be the weaker sisters.
It was also interesting to see MOL seeking European bases of his airline to share in the financial pain. Can some airports survive at their current stature without supporting his request ?
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Exactly Ryanair has messed up with their fuel hedging whereas Jet2 have theirs sorted throughout Summer 08, Winter 09/09 and Summer 09! As mentioned earlier so have Globespan so for now these two are here to stay! Who knows what will happen after these periods but one thing for sure is that Jet2 & Globespan are projecting profits, albeit small profts for this and next year however Ryanair is only expecing to break even due to their cr&p managament of fuel prices!! Very clever to be flying passengers who only pay a small fare with oil at $130 a barrel and no protection whatsoever!