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BBT March/April 2019 cover
March/April 2019

Ryanair to back Niki Lauda’s new airline

Ryanair aircraft

Ryanair is planning to take a majority stake in Niki Lauda’s new Austrian low-cost airline Laudamotion.

Formula One motor racing legend Lauda beat off competition from British Airways’ owner IAG to purchase the assets of his former airline Niki, including 15 Airbus A320s, from the administrators of Air Berlin in January.

Ryanair said it would back Lauda’s new airline, which will operate from Germany, Austria and Switzerland, by initially buying a 24.9 per cent shareholding in Laudamotion and also wet-leasing six aircraft for the Austrian airline to use during summer 2018 which will increase its fleet to 21 aircraft.

The Irish carrier added that it planned to increase this stake in Laudamotion to 75 per cent as soon as possible “subject to EU competition approval”.

Ryanair said the cost of acquiring this shareholding in Laudamotion would be “less than €50 million”, although it will provide €50 million for start-up and operating costs during the airline’s first year.

Michael O'Leary, Ryanair's CEO, said: “Laudamotion will benefit from this partnership between Niki Lauda and Ryanair.

“With access to the Ryanair fleet and financial resources, Laudamotion will now grow more rapidly, as it seeks to compete in a market which is dominated by Lufthansa's high airfares with its Swiss and Austrian subsidiaries.”

Lauda originally set up Niki in 2003 before selling it to Air Berlin in 2011. Air Berlin went into administration in August 2017.

"I have always stood up for competition and have opposed monopolies,” added Lauda. “I am thrilled that in the partnership with Ryanair, Laudamotion will be able to establish itself as a strong competitor and to grow quickly and sustainably.

“A new player in the aviation market is born and I am looking forward to offering our passengers an extensive route portfolio at competitive air fares."

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