- Airport Investment Details
- CAPA Analysis
- Schedule Analysis
- Route Maps
- Fast Fact Report
Ryanair is Europe's largest airline, the largest low-cost carrier, and one of the world's largest airlines as measured by international passengers carried. Ryanair's largest hub is at London Stansted Airport, with its second largest base at Dublin Airport. The carrier operates a comprehensive network of services across Europe, the Mediterranean and North Africa with a fleet of over 300 B737-800 aircraft.
Location of Ryanair main hub (London Stansted Airport)
Ryanair share price
LCCs will continue to evolve into hybrids of the original core model. CAPA and OAG consider Ryanair fits the LCC profile and it is included in our reporting on this basis. Please note: when reporting for an airline is changed from or to LCC the historical data is not affected and it can lead to a distortion in the current reported data. Contact us if you have any queries.
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After Alitalia’s board approved the second phase of its business plan on 22-Dec-2016, CEO Cramer Ball stressed the importance of achieving the support of its workforce. He said, “Everyone has to pull in the same direction to make Alitalia a viable, sustainable success story and help the airline achieve its ambition of long-term growth and profitability”. Alitalia suffered strike action from some flight crew in 2016.
Full details of the plan, which has received the support of Italy's government, have not yet been made public. Alitalia's network strategy includes further long haul growth and a reworking of its short haul operation, with an emphasis on feeding long haul via Rome and Milan. Other elements of the plan include cost-cutting, reduced headcount and possible changes to joint venture agreements. Details are to be presented to Alitalia’s workforce in Jan-2017.
Also on 22-Dec-2016, Alitalia's shareholders approved short-term funding and gave management 60 days to begin negotiations with key stakeholders - lessors, suppliers and distribution companies, in addition to trade unions. Alitalia needs their support for deep cost reduction measures, in order to win the long-term financing needed to secure the airline's future.
On 15-Dec-2016 Lufthansa’s Executive Board formally decided to exercise its call option for the 55% of shares it does not already own in the parent company of Brussels Airlines. The deal will close by the beginning of Jan-2017. It had been expected that Lufthansa would fold Brussels Airlines, at least partly, into its Eurowings low cost brand. Lufthansa has now confirmed that the new acquisition will join Eurowings and be fully integrated into the Group as of 2018.
Nevertheless, there are clear differences between Brussels Airlines' business model and that of Eurowings. Brussels Airlines is a network airline (and a Star Alliance member), while Eurowings is primarily a point-to-point airline. Furthermore, Brussels Airlines is not low cost in CASK terms, although, ominously, its unit cost is below Eurowings'.
Strangely, and perhaps tellingly, Brussels Airlines will retain its brand while adding that of Eurowings. This hints at the tension between Lufthansa's urge to expand Eurowings rapidly to compete with LCCs and the necessity to work out exactly how Brussels Airlines can fit into its low cost operation. Perhaps the delay between completion of the Brussels Airlines acquisition and its integration into Eurowings will give time for further refinements to the model. In short, Lufthansa has a lot of balls in the air. Where they will fall will be critical to its future.
A vote on 14-Dec-2016 by British Airways 'mixed fleet' cabin crew raises the real threat of strike action - and, as is often the case, in the lead up to a peak holiday period. This would be the first serious industrial action since strikes by cabin crew protesting at the 2010 introduction of mixed fleet crew. BA, and its parent IAG, have been praised by many observers (including CAPA) for their resolve in driving through important restructuring programmes in legacy airlines, while their European peers have fallen behind the field. A crucial part of this has been to generate labour productivity improvements, often in the face of union resistance.
British Airways has a good track record in improving the efficiency of its workforce, as measured by ASKs per employee. In 2015 it made its highest-ever operating profit margin, beating Europe's other major legacy airlines, and it looks likely to improve on this once again in 2016. However, it does not have a great record of lowering unit labour cost.
Moreover, BA is currently experiencing falling unit revenue. With help from lower fuel prices receding, cutting ex fuel unit cost will be vital if BA is to fight off the margin squeeze resulting from unit revenue weakness. Labour is a key element of ex fuel cost, so the cabin crew dispute is a test of BA's resolve.
Kenny Jacobs, Ryanair's Chief Marketing Officer, has said that its website aims to become the "Amazon of air travel". The airline that was built around selling seats on flights as cheaply as possible – and not much else – now wants to sell a much wider range of products and services. In Oct-2016 it launched its new accommodation service, Ryanair Rooms, and it plans Ryanair Holidays by next summer.
Now well into its third year, Ryanair's 'Always Getting Better' programme (abbreviated to 'AGB') has been a demonstrable success. Accompanied by a move to increase Ryanair's presence in primary airports, AGB has aimed to improve customer service and reinvigorate its digital interfaces. Since AGB was initiated in 2014 Ryanair's passenger numbers have returned to double-digit rates of growth, and load factor has gained more than 10ppts.
Romania aviation Part 3: Blue Air opens Liverpool base and creates new markets; TAROM feels the heat
CAPA's first two parts of this analysis of Romanian aviation and the country's leading airlines highlighted the rapid, LCC-fuelled growth in the market of the past two years. The home-grown LCC Blue Air has overtaken the national airline TAROM in passenger numbers and fleet size, although Wizz Air is the largest airline in the market and Ryanair is also growing fast in the country. This third part of the analysis considers respective route networks and the competitive positions of TAROM and Blue Air.
Blue Air announced in Oct-2016 that it will establish a base in Liverpool in 2017, with new routes from the UK city to a range of European destinations outside Romania. This is a sign that Blue Air is taking the fight to airlines such as Ryanair and easyJet as it embraces the pan-European LCC model. Blue Air CEO Gheorghe Racaru has said, "The UK is a strategic market for Blue Air and we strongly believe that basing a 737-800 at Liverpool will allow us to strengthen our position as one of Europe’s fastest growing airlines".
For its part, TAROM, loss-making in contrast with Blue Air's profitability, is embarking on a restructuring following a change of management. It is facing increased competition on its network, while Blue Air has targeted its growth on routes where competitors are scarce or non-existent.
The first part of CAPA's analysis of the aviation market in Romania examined its rapid growth, driven by LCCs. Romania has become an important battleground for two foreign airlines – Wizz Air (the biggest airline in the country) and Ryanair. Local low cost airline Blue Air is also growing rapidly, while Romania's government-owned national airline, TAROM, is stagnating.
This second report on the Romanian aviation market looks at the country's two main home-grown airlines, in particular the development of their capacity and fleet. Traffic data for the two are scarce but it seems that Blue Air, which commenced operations in 2004, is now larger than TAROM by number of annual passengers carried.
After a change of ownership in 2013 Blue Air seems to have been revitalised and has adopted a more pan-European strategy, with bases in Turin and Larnaca and a base planned for Liverpool in 2017. Its growth has also been prompted by the aggressive expansion of Wizz Air and Ryanair in Romania. Blue Air, now bigger than TAROM, became a full member of IATA in Jan-2016.
Part three of CAPA's analysis will present details of the respective route networks and competitive positions of TAROM and Blue Air.