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When Rhys met Michael O’Leary, CEO of Ryanair

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I was at the Andaz Liverpool Street hotel on Tuesday, where Ryanair’s CEO Michael O’Leary was announcing its biggest winter schedule ever, with flights from 21 UK airports.

(By a crazy coincidence, I was also staying at Andaz Liverpool Street on Tuesday night to review it for HfP. This was arranged before the Ryanair invitation appeared.)

Arriving 20 minutes late (from a Ryanair flight…?!) O’Leary rushed into the room ripping off the bubble wrap from a blue-and-yellow sign heralding the announcement. He began telling his assistant to sort out his laptop whilst he handed out paper copies of the press release for journalists.

Ryanair press conference

I have a lot of respect for Michael O’Leary. Most airline CEOs tiptoe around questions and harp PR platitudes. O’Leary doesn’t. After mucking in to get the conference set up he immediately launched into an impressive, fast-talking 10-minute presentation, hammering home everything he wanted to cover. He’s direct, gets the job done and gets on with it.

It’s rare to be at a press conference that’s interesting. O’Leary actually makes it fun, firing zingers left, right and centre.

So, whilst we wouldn’t normally write about Ryanair, we thought it would be an interesting opportunity to write about what Michael O’Leary thinks about the issues plaguing the airline industry in 2022.

The Gospel According to Michael O’Leary

On Heathrow ….

Ryanair doesn’t fly from Heathrow, and doesn’t have any plans to. This didn’t stop O’Leary from letting us know his views on the UK’s biggest airport.

Branding it ‘Hopeless Heathrow,’ he admonished airport management for failing to fix their staffing issues and instead choosing to implement a passenger cap right through the summer and into the winter.

Of course, Heathrow wasn’t the only airport that experienced delays at the start of the summer. Gatwick and Manchester were also affected, although O’Leary claims that both airports have now recruited to eliminate those problems and are operating much more smoothly.

Not so for Heathrow: instead of recruiting more staff, “the visionary way to serve your customers is to cap them”.

He did offer a solution to the problem. Shareholders “could start by firing John Holland-Kaye [the CEO] out of Heathrow.” I am genuinely shocked this hasn’t happened already, to be honest.

On Her Majesty’s Government ….

“Scrap Air Passenger Duty and scrap hard Brexit” is what O’Leary said when asked what his top priorities would be for the new Prime Minister. “Grant Shapps would be no loss to the transport sector” either ….

O’Leary takes a pragmatic view on Brexit. Whilst Brexit won’t change, he did rail against “Johnson’s hard Brexit” which has resulted in what he perceives as the most difficult labour market in Europe. “At least put in place some free trade agreement with Europe to allow UK and European citizens to move to and from Europe to work …. do a Brexit deal that makes sense for UK consumers and the UK economy.”

The Civil Aviation Authority wasn’t spared either. “What have the CAA ever done for us?” O’Leary’s view is that the CAA is fundamentally powerless – although “I wouldn’t give the CAA any more power, I would ban them.”

Ryanair press conference

On a recession ….

The ‘R’ word was at the tip of everyone’s tongues, although O’Leary was remarkably bullish on the subject. “We will grow stronger in a recession, as we have in every other recession before.”

Instead of cancelling holidays, O’Leary sees passengers trading down to cheaper carriers, which inevitably means flying Ryanair. “It’s BA and easyJet that will struggle.”

Fears of cratering demand and increased oil prices have meant many airlines are reducing schedules. Ryanair, meanwhile, is increasing them, and is hoping to mop up all the demand left on the table. Wizz Air, for example, is trimming its schedules by 25% because it failed to hedge its fuel costs.

Ryanair has hedged 90% of its fuel requirements to March 2023 at around $63/barrel and 40% at ~$93/barrel until March 2024. Whilst Ryanair’s average airfare will rise in the single digits over the next 3-4 years the airline will continue, claims O’Leary, to grow to 225 million passengers in 2025, from around 166 million this year.

Ryanair is also getting good deals from regional airports, where there is a golden opportunity “replacing aircraft and capacity that has disappeared from their airports as a result of covid or the financial collapse of airlines.”

Overall, he predicts that European aviation in 2023-2024 will lag pre-covid numbers but that Ryanair will be bigger. That’s not a hard target to achieve given that the airline is already opearting at 115% of 2019 capacity this year. “I’ve never tempered a growth plan in my life – it’s full steam ahead.”

On Boeing ….

Ryanair’s growth will depend on the arrival of aircraft it has ordered, however. The airline has a total of 210 737MAX on order, which it will use to replace and expand its network. The planes will deliver massive savings, as they can take eight more passengers than the older 737s whilst being 16% more fuel efficient.

The only question is whether Ryanair gets them on schedule with just over 50 due to arrive this winter. Right now, O’Leary thinks the jury is out on whether Boeing can deliver. “You’ll get more excuses than aircraft deliveries [from Boeing] this winter.”

He says “Boeing are running around in fucking denial,” with surplus engines and surplus wings waiting for aircraft on the final assembly line to move out. He places the blame firmly on Boeing’s mismanagement of the program: “it’s not supply chain issues, it’s bad management in Seattle.”

On Ryanair ….

Of course, his main reason for being in London was to trumpet Ryanair’s winter schedules.

With flights from 21 airports, it will be Ryanair’s biggest winter schedule ever, with five new bases opening including Belfast. In total, Ryanair will operate over 2,000 routes from October to March, with fares starting from £29.99.

“The era of low fares is not over but the £9.99 fares, really cheap and cheerful fares, are over for a couple of years.”

Comments (175)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Scott says:

    Hmmm…two most vocal airline CEO’s…O’Leary and Akbar Al Bakar run the most profitable airlines…by a large margin….

  • ChasP says:

    whatever happened to the plan to offer transatlantic flights ?

    Now that single aisle LR are available will he consider it again ?

    • callum says:

      There are no plans and there never really was beyond a vague idea to maybe run them in the future.

      I wouldn’t imagine they’d be doing so any time soon. If the likes of Norse become successful though it may prompt them.

      • Londonsteve says:

        No chance. It’s a deep market but very competitive, flying between two of the most prosperous parts of the planet and with long block times. Most pax are travelling on business or leisure, but the latter not so price sensitive that they’re interested in sacrificing all the trimmings to save a few pounds. There is admittedly a niche for someone like Norse, fulfilling a need from students, those seeking an affordable one-way or those on very short trips that have no need for luggage but this really is a small minority. There’s a reason why no real LCC (Ryanair, Wizz, Spirit, et al) have shown any interest in the transatlantic market and why BA are putting all their eggs in one basket (where they’re sitting pretty with their profit sharing and the ME3 can’t eat their lunch).

    • QFFlyer says:

      Prob waiting to see if it can be done viably be someone else first (they can take on the risk) – since nobody has managed it yet and survived, I don’t see it – people will endure FR on a short haul flight, but TATL?

  • Nick says:

    Problem I have found with FR (apart from MOL) is that I travel with both hand luggage and a checked baggage, once you’ve got these extras added it isn’t any cheaper than a BA flight in most cases.

  • Novice says:

    Isn’t Boeing 737 Max the killer plane???

    • JerrySignfield says:

      It’s the one I don’t want to fly on despite people now saying its the most scrutinised one, should have been scrapped, completely bizarre!

    • QFFlyer says:

      It’s fine. Yeah two of them crashed, and it was a huge PR disaster as a result (not ignoring the fact that hundreds of lives were lost too), but they’ve been back through the process and I’ve flown them again since they were put back into service (with AC), I don’t have any worries.

  • Alex Sm says:

    This mention of paper press releases reminded me of our business proposal we wanted to send to R-r a few years ago. We couldn’t find any publicly available email addresses and had to send it by post in hard copy! And received the response in the same way. I still keep it

  • Freddy5 says:

    OK it’s time to send Rhys on a 27p flight. Go via Budgetair and you’ll get £8.40 back making this flight (actually several in Italy) just 27p net net (Budgetair slightly discounts the Ryanair price then you get £8.40 back).

    Not as good as my (minus) -2p flights with Budgetair to a famous European capital earlier this year, but I guess inflation is hitting us all hard.

    • Londonsteve says:

      Freddy5, what’s your agenda with repeatedly promoting this operation? Ryanair pays no sales commission and actively tries to dissuade its passengers from booking tickets anywhere other than its own website. I wouldn’t want to lose control of my booking for barely more than a pint of beer. Recent times have shown how important it is to be able to cancel or reschedule online.

This article is closed to new comments. Feel free to ask your question in the HfP forums.

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