Ryanair grounds 14 aircraft on recession fears
Breaking Travel News in the Uk says Ryanair is grounding 14 aircraft at its Stansted base this winter as weakening consumer demand and high fuel costs eat into its margins.
Announcing the cuts, Howard Miller, Ryanair’s chief financial officer, added that the group expects its average fare to fall by 5 per cent this year.
“We’re heading into recession and people are becoming much more price sensitive.” “Our experience of recession is that fares generally fall,†Mr Millar said.
“We are already seeing signs of this ourselves despite a reduction in capacity.”
“People are more price sensitive and carriers will struggle to fill their seats unless they reduce fares,” he said.
The group has not pre-bought any fuel beyond the end of this year and remains exposed to fluctuations in the price of oil.
Last year it grounded seven aircraft at its Stansted base.
Against a backdrop of Alitalia’s woes, the airline also announced today that it is increasing its Italian operations with the launch of six new routes from its Forli hub from December, flying to Alghero, Bari, Cagliari, Lamezia, Olbia and Palermo.
Speaking in Forli, near Bologna today, Ryanair’s Bridget Dowling said: “Ryanair has already introduced Italian consumers to its guaranteed lowest fares and no fuel surcharges on international and domestic routes.”
“We look forward to bring more massive savings to consumers in Forli by launching these 6 new routes 4 months earlier than expected.”
“We expect to carry 500,000 passengers from/to Forli in 2009, which will sustain 500 new jobs and generate €80M visitor spend in the Emilia-Romagna region,†she added.
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