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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)

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  • Erico1875 says:

    If only Ryanair had a loyalty scheme.
    I had a Ryanair credit card about 15 years ago. I don’t think we got many benefits though

    • JDB says:

      One of the keys to Ryanair’s success is not having baubles like a loyalty scheme – they see that as unnecessary cost and complexity.

      • Charles Martel says:

        But at the same time we’re told IAGL contributes shedloads to IAGs profit, it feels like a contradiction.

        • Thegasman says:

          BA can offer aspirational redemptions like business class to glamorous long haul destinations. This has historically directed a lot of price insensitive business travellers there way. Ryanair doesn’t have those customers or redemption opportunities.

  • Rwac1 says:

    Belfast doesn’t become a base until summer 23. Is not included in the winter announcement.

  • Joey London says:

    He’s a classic example of getting ahead in business mainly by being confident. The thing is, his critiques of everyone and everything else are elementary and suggest he doesn’t have much of a clue what he’s talking about.

    • ChrisBCN says:

      Just curious – which of his statements make you say he doesn’t have a clue what he is talking about?

      • Ian says:

        …and whether you like Ryanair or not, MOL has made a great success of Ryanair, so he must have some clue what he’s talking about!

    • Ken says:

      He’s managed to run amazingly successful Ryanair for almost 3 decades, while amassing wealth of almost 1bn euros.

      And he doesn’t know what he’s talking about?

      Heard it all now

  • JDB says:

    Did O’Leary mention all the lobbying efforts FR is making to water down EC261 and UK261? While he has been incredibly successful in opening up air travel to millions by slashing fares while making big profits, it has also meant that the compensation amounts determined in 2004, even allowing for inflation erosion, now look ridiculous vs today’s fares. He is also complaining about ECJ decisions that have gone beyond the wording of the legislation. The EU flag carriers are, unsurprisingly, right behind him.

    • Freddy5 says:

      You could easily make a very sound/ logical argument for reducing compo levels as per EC/ EU/ UK 261. They are set at a punitive level that usually far exceeds the inconvenience suffered by the delayed or cancelled traveler.

      But this element of ‘punishment’ or deterrence is clearly needed to keep airlines ‘honest’. Ie to discourage over-selling of tickets/ willy nilly cancellations and to keep them on their toes as regards reliability.

      OTOH as long as the provision for Duty of Care is maintained + the right of passengers to source an alternative flight at their convenience (and charge the difference to the original/ cancelling airline) – then I can’t really quibble with O’Leary’s point that compo is set too high.

      • Rhys says:

        There’s definitely a case for reforming EU261. What I would do is:
        – potentially reduce compensation levels, but ensure they are paid out automatically to all passengers. This would save a huge amount of arguing and free up airline customer service agents for problems that really matter
        – make it easier for passengers to see the real reason for delays/cancellations, rather than having to rely on the airline’s word etc

        • marcw says:

          The regulation is very ambiguous – that’s the main problem; so judges have to decide whether something is “out of the control of the airline operation” and what not. And it’s a grey area. That’s what clogs up the whole problem.
          I don’t think compensation levels need to be reduced. They have to be adjusted to better reflect reality.
          A FRA-MUC cancellation or delay might not be as bad as a Barcelona – Palma flight, where there are no real alternatives. For FRA-MUC you can take train or car. For BCN-PMI, you name it (ferry, is an option, but very slow).
          There needs to be an additional category on the longer distance itineraries, too.
          For airlines to pay out automatically compo, that’s not gonna happen.

        • Bagoly says:

          Agree with the automatic payouts.
          Administered centrally, funded by a levy on airlines proportionate to their delay record.
          A good first step would be to have the EASA/CAA publish a list each day (7 days later) of every flight and whether it triggered compensation or not.

        • Lady London says:

          …and a multiplied payout for any delays or refusals that wasted everybody’s time. Airlines should only be allowed, say, 21 days to do any investigations/reach a conclusion and then should have tl pay out within 7 days otherwise paysbles increase by 5% compound per day. Any claim rejected and later upheld to be at least doubled

      • ken says:

        “then I can’t really quibble with O’Leary’s point that compo is set too high.”

        While it must be galling for airlines to have to pay compo several times the flight price, much of Ryanairs passengers are for short breaks where a 6 hour delay causes far more inconvience than simply the flight cost.

        The other issue is that Ryanair (along with the rest) are simply bad faith actors when it comes to treating passengers fairly and reasonably, or even complying with legislation.
        In fact he spent 20 years boasting about it.

        • Freddy5 says:

          I’m no apologist for O’Leary/ Ryanair and their deliberate bad tactics in the past as regards EC261.

          But you have to give credit where it’s due: about 3 years or so ago, Ryanair effectively pivoted/ made 180 degree turn on this issue. As long as you go through Ryanair’s online compo procedures, compo is paid seamlessly and quickly in most cases. Definitely a very straightforward experience these days compared to (say) BA.

          I think they just decided as a company that it better to present a customer-friendly face and that in any case once you factor in legal costs, it was better to pay out compo readily for the (remarkably few) passengers who actually put in a compo claim.

          • Lady London says:

            No, IIRC Ryanair was actually told to clean up its act and obey the law that time ago else massive fines would fall on them. No other reason would they do it

          • Freddy5 says:

            Point remains the same, though. Very straightforward to get EC261 compo (and DOC) from Ryanair, where justified.

  • Joanne says:

    I used to love flying ryanair until they cancelled the flight on the run up to my wedding meaning alot of my guests didn’t arrive, including my dad, so I walked down the aisle alone. Also my maid of honour and bridesmaids didn’t arrive. No compensation. No apology. Just escorted out of the airport in the middle of the night unless they accepted rescheduled flights which were over a day away after an already very long delay.

    Also had issues with huge delays lately which do qualify for compensation but told by ryanair they’ve landed within the time frame. So I’ve recorded the landing on the next flight to prove they lie and still got no response.

    Absolute joke. Was approached by the papers to be told Ryanair are notorious for it but for some reason it’s rarely reported in the news…. so our story got reported… Still ryanair didn’t give a shit!

    Definitely get what you pay for. I haven’t used ryanair since and don’t plan to again.

    • Rob says:

      And this is different from BA cancelling thousands of flights, often at short notice (my wife was recently stranded in Frankfurt) and refusing to honour their legal obligations to reroute you? She was told she’d be in Frankfurt for 2-3 days until BA had a seat.

      Of course, others are no better. We bought a £600 fully flex Lufthansa ticket to get her home. A BA seat then appeared for 24 hours later so she took that and cancelled the Lufty, because we didn’t want the legal stress of chasing BA for £600. Has our money come back from Lufthansa, 8 weeks later? No.

      • Brian78 says:

        To be fair I don’t think many people on here think BA are any good/better than Ryanair.

        Obvs they continue to use them regularly though even when other options are available (which they are often are)

      • SamG says:

        The annoying thing about this is BA do have a reroute agreement with LH – so the left hand of BA has bothered to at least attempt to put some mitigation in place , they just seem to find it impossible to get the right hand to consistently execute it !

        Lufthansa I imagine have a huge backlog of refunds due to their recent strikes and disruptions

        • Lady London says:

          And tomorrow their pilots are on srike

          I would really like to know how Lufthansa made such a mess of its relationships with unions

    • Lady London says:

      Remember you have landed when the aircraft is parked AND the door opens to let a passenger (not crew) leave the aircraft AND the ramp or stairs are fully connected AND have been made available for first passenger out to use.

      Ignore all announcements on wheels touch down or taxiing “welcome to… we have now landed in…”. No you haven’t for EU261 till the above. Ignore in particular any Ryanair trumpets.

      Synchronise your watch/phone timing with a neutral source and pref a witness, at latest while you are taxiing

  • Freddy5 says:

    Talking of Skyscanner, we’ve got Ryanair flights booked for November that see us going via Bergamo (Milan) to get to our real destination (Europe). You look up the cheapest tickets on Skyscanner then book/ go via Budgetair to get your 2 x £8.40 back (each, ie 2 flights each less the £8.40 they give you back, per flight). So you need to book flights separately to get max benefit. Connection time in Bergamo is about 4 hrs – bit boring but means we’re unlikely to miss second flight fingers crossed – chance to check out hospitality side of things at Bergamo airport (any tips? we’ll be both airside and landside). I think we’re saving about £80 each vs direct flights but I might just possibly buy travel insurance for this one.

    Total cost A—>B—>C should be about a £tenner.

    • lumma says:

      Bergamo airport is a decent size so there should be lots to keep you occupied. I did a similar layover at Aarhus airport and it seemed a long time – there’s nothing but a vending machine landside, and the city is too far away to visit.

      Doing this, as long as there’s plenty of options, I don’t book my first night accommodation until I know I’m going to make the second flight.

  • Doc says:

    Did he comment on why he won’t use the marque “737 Max 8” on the side of his aircraft? Asking for a friend…

  • Peter Huntingdon says:

    I admire Mike O Leary as a very successful Business Man but I dislike the contempt he has always had for the passengers who use his Airline , and for that reason I would never fly on his Airline.

    • ne_scot_abz says:

      ” contempt he has always had for the passengers” what contempt? I have bought tickets from Ryanair and had no contempt from Mr O’Leary.

    • masaccio says:

      I don’t think he has contempt for his customers either. He sets very clear expectations and meets them. People who are happy with the product rave about RyanAir. I personally don’t fly them because I hate Stansted, pretty much always need hold luggage on holiday, and always fly school holidays.

      • Brian78 says:

        I think people expect too much from a £30 flight. You get what you pay for.

        If you don’t like it then fly with someone else

        • John says:

          BA, when they had £30 flights, fed me (lounge, and not BA lounge) meals which would have cost more than £30 in a restaurant 🙂

    • Freddy5 says:

      You can search for source/s (see below) but it all changed in 2015, you have an outdated view of Ryanair, though I suppose images formed many years ago may stick in your mind rather ‘stickily’:

      For the first 20 years of his career in the airline business, Ryanair CEO Michael O’Leary liked to think that he was always right and his customers always wrong.

      Now with a 66 percent jump in full-year profit, nine million additional passengers, and the outlook for the next 12 months looking similarly rosy, European aviation’s enfant terrible is singing a different tune.

      “If I’d only known that being nice to customers was going to be so good for my business I would have done it years ago,” the Irish executive said in an interview this month.

      With an eye on the successful marketing strategy of discount retailers like Aldi or Ikea, Ryanair has pursued a full-fledged image revamp. Out with irritants ranging from excessive baggage charges to its ebullient on-time arrival trumpet. In with business-friendly perks like reserved seating and serving primary airports instead of dusty airstrips in the countryside.

      The aim is to turn a brand once known for being “cheap and nasty” into one offering good value, O’Leary has said. Gone are the days when offering the lowest fare alone pulled in the public. With full-service carriers like Lufthansa or Air France rolling out their own versions of no-frills airlines, competition in the sky for cheap tickets has heated up.

      The good news for Ryanair shareholders is that cuddling puppies and eating one’s words appears to be good for business. Ryanair shares have risen 85 percent since the beginning of last year when it started introducing changes, and profits are at an all-time high after falling for the first time in five years in fiscal year 2014.

      “Everybody loves a converted sinner,” O’Leary said. “We have learned humility, which when you’re Irish that’s a tough lesson to learn — humility doesn’t come easy to us — and that we have to keep learning and listening to our customers.”

      • Thegasman says:

        Why did I have to pay €55 Euros in June for airport check in for a suitcase I’d added to a booking (& paid €40 for). I had to use the check in desk either way & was there 1 3/4 hours pre departure. Apparently the check in agent having to tap a couple of extra buttons on a keyboard justifies €55.

        Conveniently on-line check in closes 2 hours before departure just as bag drop desks open.

        I know I should have checked/remembered but having avoided them for a couple of years I’d forgotten just how low they’ll stoop to empty your pockets. Unfortunately now living up north again it’s going to be difficult to avoid them. (The flights weren’t cheap by LCC or BA standards either!)

        • Freddy5 says:

          …because you didn’t keep to the Ryanair rules, which are easy to understand and observe.

          Sure: it’s nice to check in last minute at desk with BA, get away with 25kg instead of 23kg, ask them to move your seat free of charge etc – but each airline has its own rules and MO.

          Which as long as they are transparent, I can’t see any issues with – I’ve never paid Ryanair a penny more than I was expecting. They streamline operations to save on costs and charge slightly punitive amounts for elements that they want to deter (cost them money & time). Not to rip you off but to get you to comply with their operational standards.

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