By Euro Weekly News Media • 08 November 2016 • 11:30
MICHAEL O’LEARY: The airline boss believes fares will rise over the long-term.
LOW-COST airline Ryanair has announced plans to slash fares by up to 15 per cent this winter, in a move which could result in a price war with competitors such as easyJet, Flybe and Jet2.
The budget carrier claims that the lower prices will be facilitated by unexpectedly cheap fuel, with the savings earmarked to be passed on to passengers.
Chief Executive Michael O’Leary said: “We’re looking to a winter where, as far as we can see, fares will keep falling. That should be good for demand. We’re 2 per cent stronger booked into the winter period than we were this time last year.
“I think we’ll continue to trade strong, it’s very good news for customers but shareholders will have to wait a little for returns.”
Ryanair currently runs winter flights on routes such as Gatwick to Alicante for €20-25, but these prices are now set to drop even further, with surveys suggesting that flights to the UK’s favourite holiday destinations, including Spain, fell by an average of 15 per cent over the same period in 2015.
However, O’Leary also warned that once the UK leaves the European Union there will be less flights operating from the country, which will inevitably lead to a price increase.
“For passengers what is inevitable is in the next 12 to 18 months you benefit by having lower fares,” he said. “But over the medium term if there is a hard Brexit there will be less capacity here in the UK and less capacity means higher prices.”
O’Leary backed the Remain campaign in the build-up to the referendum, and described the politicians leading the current negotiations as “puddings” before claiming the UK economy to be in “real trouble.”
He added: “It’s hard to believe that the UK government could be more uncertain or it’s going to get any less certain as to what the hell they’re doing about Brexit. Given that they haven’t an idea what the hell the’re doing about Brexit in the first place.”
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