Ryanair to increase fares for the first time in four years
Ryanair reportedly plans to increase fares for the first time in four years, to sustain earnings growth as the carrier slows its expansion plans (Bloomberg, 20-Jan-2010). CFO, Howard Millar, stated the LCC is likely to raise fares from 01-Apr-2010, the start of the new financial year. The carrier also plans to cut routes from its Summer 2010 schedule for Dublin, while average fares from Dublin will rise approximately 10%, in response to increasing airport charges at Dublin Airport (The Irish Times, 21-Jan-2010). Mr Millar added Ryanair would consider offers for its stake in Aer Lingus, but is not expecting any bids.
Ryanair: “We’re in the midst of recession and we expect to slow down our growth…We’ve had a lot of discounting of fares as we’ve grown the business. We expect to increase profits by the combination of reducing costs and we think average fares will probably rise,” Howard Millar, CFO. Source: Bloomberg, 20-Jan-2010.
Ryanair: “We would hope that with fares having fallen by 20 per cent over the past 12 months [that] they would rise over the next 12 months, but I wouldn’t hold my breath,” Michael O'Leary, CEO. Source: The Irish Times, 21-Jan-2010.