Ryanair instructs lawyers to file complaint against Stansted

Ryanair has instructed lawyers to file a complaint with the CAA and Competition Commission, demanding that they revise the current price cap at Stansted.

It says they need to eliminate what Ryanair believes are “monopoly abuses and overcharging” of Stansted’s airlines over the past five years (2007-2011) during which:

• Stansted’s traffic has fallen 24% from 24m to 18.3m (from 2007-2010)
• Airport charges have doubled from €3.30 per pax to €6.60 per pax.
• Stansted’s costs have risen 16% from £155m to £180m, despite a 24% fall in traffic.

Ryanair chief executive Michael O’Leary said: “Stansted’s regulatory accounts, in our opinion, clearly show the BAA gaming the regulatory system, and abusing its monopoly power to inflate its RAB and inflate its costs in order to overcharge airlines and passengers at Stansted. BAA Stansted has inflated their regulatory asset base by over £270m in inflation adjustments, and by £200m in second runway costs, for which there is no justification.

“BAA Stansted’s regulatory accounts also show a myriad of unexplained intra-group costs, reallocation of Heathrow costs and an 80% increase in Stansted’s electricity bill in 2010, due to a “revised allocation” of Heathrow’s electricity costs in a blatant attempt to understate the enormous profits being exploited by BAA Stansted monopoly.

“The sooner Stansted is sold, the sooner it will be run efficiently to meet the needs of its low fare airlines and enable them to stimulate traffic and tourism growth, to promote choice and competition.

“Competition can provide Stansted’s airlines and passengers with better service, at a fair price, whereas in recent years we have suffered atrocious service at rapacious prices, because in our opinion the BAA is an abusive monopoly and the CAA has been an incompetent regulator.”

by Bev Fearis