O'Leary Forecast for Middle East Long-Haul Airlines
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O'Leary Forecast for Middle East Long-Haul Airlines
Wall Street Journal
November 30, 2011, 10:07 AM GMT
Ryanair CEO: Gulf Shake-Up May Prompt Low-Cost Trans-Atlantic Flights
Michael O’Leary, chief executive of low-cost airline Ryanair Holdings, was in Shanghai Tuesday to meet with senior management at Commercial Aircraft Corp.of China (Comac) and see plans for a 199-seat version of Comac’s forthcoming C919 passenger jet.
But in an interview Tuesday evening, Mr. O’Leary went beyond Chinese aircraft and Ryanair’s near-term plans for fleet expansion to give his thoughts on the potential–first raised before the financial crisis–for a low-cost trans-Atlantic airline.
The main prerequisite for such a carrier is the availability of cheap, long-haul aircraft, Mr. O’Leary said, and a shake-up among Middle Eastern airlines could be the key.
“You’ve got these Gulf airlines coming in and ordering ludicrous … numbers of long-haul aircraft. It’s almost a penis competition,” said Mr. O’Leary, as usual using language designed to shock.
“[But] you can’t have three big Gulf interconnecting carriers all at the same time. They’re going to kill each other. Somebody wins and two or three people lose,” he said.
If what Mr. O’Leary terms the “sorting out” of competition among Gulf carriers coincides with the elimination of a backlog in deliveries of long-haul aircraft such as Boeing’s 787 and Airbus’s A380 over the next four or five years, he says he expects to see “a lot of spare long-haul capacity,” which would set the stage for a low-cost trans-Atlantic airlines.
Mr. O’Leary didn’t say whether he was planning such an airline, but noted that it would be “not entirely like Ryanair.”
“It can’t be all economy (class),” Mr. O’Leary said. “Because there is 20-25% of the market that will pay you a ludicrous yield” to travel in business class on longer trips.
“I’m one, I wouldn’t go across the Atlantic in economy,” he said.
Despite Mr. O’Leary’s interest in Comac and the C919, the Chinese aircraft wouldn’t have a role to play in the hypothetical airline–a competitor to Boeing’s 737 and the Airbus A320, it simply doesn’t have the range required, he said.
Ryanair's Michael O'Leary Says Gulf Shake-Up May Prompt Low-Cost Trans-Atlantic Flights - The Source - WSJ
November 30, 2011, 10:07 AM GMT
Ryanair CEO: Gulf Shake-Up May Prompt Low-Cost Trans-Atlantic Flights
Michael O’Leary, chief executive of low-cost airline Ryanair Holdings, was in Shanghai Tuesday to meet with senior management at Commercial Aircraft Corp.of China (Comac) and see plans for a 199-seat version of Comac’s forthcoming C919 passenger jet.
But in an interview Tuesday evening, Mr. O’Leary went beyond Chinese aircraft and Ryanair’s near-term plans for fleet expansion to give his thoughts on the potential–first raised before the financial crisis–for a low-cost trans-Atlantic airline.
The main prerequisite for such a carrier is the availability of cheap, long-haul aircraft, Mr. O’Leary said, and a shake-up among Middle Eastern airlines could be the key.
“You’ve got these Gulf airlines coming in and ordering ludicrous … numbers of long-haul aircraft. It’s almost a penis competition,” said Mr. O’Leary, as usual using language designed to shock.
“[But] you can’t have three big Gulf interconnecting carriers all at the same time. They’re going to kill each other. Somebody wins and two or three people lose,” he said.
If what Mr. O’Leary terms the “sorting out” of competition among Gulf carriers coincides with the elimination of a backlog in deliveries of long-haul aircraft such as Boeing’s 787 and Airbus’s A380 over the next four or five years, he says he expects to see “a lot of spare long-haul capacity,” which would set the stage for a low-cost trans-Atlantic airlines.
Mr. O’Leary didn’t say whether he was planning such an airline, but noted that it would be “not entirely like Ryanair.”
“It can’t be all economy (class),” Mr. O’Leary said. “Because there is 20-25% of the market that will pay you a ludicrous yield” to travel in business class on longer trips.
“I’m one, I wouldn’t go across the Atlantic in economy,” he said.
Despite Mr. O’Leary’s interest in Comac and the C919, the Chinese aircraft wouldn’t have a role to play in the hypothetical airline–a competitor to Boeing’s 737 and the Airbus A320, it simply doesn’t have the range required, he said.
Ryanair's Michael O'Leary Says Gulf Shake-Up May Prompt Low-Cost Trans-Atlantic Flights - The Source - WSJ
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MOL might be a bit of a gob , but he sometimes has the odd uncanny insight into the future . The Gulf carriers in question are indeed ordering shedloads of hulls ( maybe just tieing up the production lines until they decide if they really need what they have ordered ) but are they hoping to create their own future payloads , or competing with the others for the same punters ? This gamble , along with the eternal problem of who is going to fly these fleets , is going to make things very interesting in the next 5 years .
