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BBT March/April 2018
March/April 2018
For Business, Corporate Travel & Meeting Buyers & Arrangers

Ryanair boss O’Leary: Air France strike ‘wonderful’ for low-cost carriers

Ryanair CEO Michael O’Leary has described the on-going Air France pilots strike as a “wonderful bonus” for low-cost carriers.

Speaking at a press conference in Germany, where he unveiled the airline’s plans to partner with GDS firm Amadeus, O’Leary said the problems legacy carriers are having at rolling-out low-cost subsidiaries can only be a benefit to Ryanair.

Air France pilots are striking after the airline announced it is aiming to transfer most of its short and medium-haul services to Transavia – a move unions claim will affect working and pay conditions.

“The strike has been a wonderful bonus for low-cost airlines,” said O’Leary. “I particularly welcomed [Air France CEO] Alexandre De Juniac’s solution last week, in typical French fashion, that they would concede and cave into the unions and decide not to expand [low-cost airline] Transavia until the New Year.

“We will then probably see that ‘no growth’ period extended for another year. With competitors like that it’s not hard to see why Ryanair is growing so quickly across Europe.”

Speaking in Cologne, O’Leary announced plans to grow its business in Germany, where it has previously failed to gain high passenger volume due to competitors such as Lufthansa and Air Berlin.

“One of the reasons we’re expanding so quickly in Germany is because Air Berlin is continuing to cut back on short-haul European destinations and focus more on Gulf routes. There is also Lufthansa that has some bizarre plan about establishing a new low-fare airline. Unfortunately [Lufthansa] started with a high-fare airline called Germanwings and they’ll need to do a lot more than call it that and paint it yellow to make it a low-cost carrier.

“As we expand more rapidly in Germany we will start to take more traffic away from Lufthansa as people are fed up with their high-fares, frequent strikes and the high-fare subsidiary.

“The problem for legacy carriers is the more they are dealing with legacy issues, such as unions who don’t see the way forward, the harder it will be to set up a subsidiary and call it a low-cost airline. This will only help us grow in Europe," O'Leary added.

Earlier today Ryanair announced plans that it would be partnering with Amadeus to distribute all of its fares and full ancillary content. O’Leary, who had previously said he would never work with GDSs or travel agents again, said if the airline is going to expand it must work closer with the business travel industry.

“I expect over time we will convert half of the current 27% of Ryanair’s business travellers to business plus, and the majority of these will come through improved relationships with corporates and GDSs and deals like the one with Amadeus makes us more visible.”


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