Ryanair warned it might make further cuts at its German bases in 2011 due to the planned air passenger tax (Reuters, 09-Nov-2010). Ryanair CEO Michael O’Leary listed Niederrhein (Weeze), Bremen and Berlin Schoenefeld as airports that may be affected. Ryanair announced in Oct-2010 that it will cancel services on nine routes from its largest German base at Frankfurt Hahn.
Ryanair warns of further German cuts
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Ryanair's Frankfurt move puts pressure on Lufthansa and supports its German growth ambitions
Ryanair and Fraport announced on 2-Nov-2016 that the Irish ultra-LCC will open its 85th base at Frankfurt Airport, Lufthansa's main hub. Ryanair will base two aircraft at the airport and launch four new leisure routes in Mar-2017. With a daily departure to each of Alicante, Faro, Malaga and Palma de Mallorca, it expects to attract 400,000 passengers pa.
Although Ryanair has been increasing its primary airport presence for some time, CEO Michael O'Leary had previously said that Frankfurt Airport was one of the few, alongside London Heathrow and Paris CDG, that Ryanair would not serve. Frankfurt was seen not only as too expensive, but also as too congested for Ryanair's short turnaround times. Details of Ryanair's agreement with Frankfurt Airport have not been disclosed, but it is likely that the airline has secured favourable terms in return for traffic growth targets.
Ryanair's move into Frankfurt is relatively small compared with its operations in Berlin Schoenefeld and Cologne/Bonn, but this development supports its growth ambitions in Germany. Ryanair's average revenue per passenger is half that of Lufthansa's network airlines. Its move increases the competitive pressure on Germany's national airline.
Europe's big five airline groups embrace disruption via digital innovation; some more than others
Many of Europe's leading airline groups are acknowledging the importance of establishing dedicated incubator and/or accelerator programmes to innovate in digital technology. On 24-Apr-2017 IAG announced that it had invested in two new technology companies – Esplorio and Vchain Tech. These are the first two investments under its Hangar 51 accelerator programme in partnership with L Marks, an innovation specialist and early stage investor.
IAG's investments followed easyJet's announcement earlier this year that its partnership with the incubator Founders Factory had selected two travel startups for its accelerator programme. The Lufthansa Group established its Innovation Hub in 2014 and started a new partnership with Californian startup investor ‘Plug and Play’ in 2016. While these three groups chose external partners, Ryanair has its inhouse Labs team, set up in 2014. Air France-KLM is alone among Europe's big five airline groups in not having a distinct and dedicated digital incubator/accelerator programme, but it has recognised digital's strategic importance.
Much of the airlines' rhetoric concerning these developments suggests that they are trying to associate themselves with the forces of disruption, but this will take more than rhetoric. CAPA has argued previously that the airline industry has been slow to prepare for disruption, but some are at least making a start.