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Ryanair, with costs 60% below Lufthansa's, begins an onslaught on domestic Germany

Analysis

Ryanair returned to the German domestic market on 3-Sep-2015, after a four year absence. Its Cologne/Bonn-Berlin service, on the largest domestic city pair outside Frankfurt and Munich, is an advance party ahead of an onslaught that will increase its seat capacity in Germany by more than 40% this winter, when it will launch eight new international routes.

This follows a capacity increase in Germany of more than 10% this summer, when five new routes took its German total to 171 for the season (source: OAG). By comparison, Lufthansa has 203 intra-Europe routes (of which 27 are domestic), Germanwings has 276 (25 domestic) and airberlin has 271 (31 domestic).

Ryanair has thrown large numbers of seats into Germany before, most recently in 2013, only to cut capacity again in 2014. In the past, Ryanair's simple charms have not suited the more refined tastes of the German market as much as in other parts of Europe, where it has a higher market share. However, as its recent FY2016 profit guidance upgrade indicates, its charms are now appealing to more people across Europe. Its latest expansion comes just as both the German market and Ryanair have become more mutually compatible than ever before.

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