Ryanair boss Michael O’Leary: We will grow stronger in a recession
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Ryanair’s chief executive Michael O’Leary said the airline will grow stronger amid the UK’s predicted recession.
The low-cost carrier said that people will not stop travelling altogether, but they will shy away from more expensive fares put forward by competitors.
“People in a recession will get much more price sensitive,” O’Leary told reporters today during a press conference.
“We will see a much larger number of people trading down from British Airways and Easyjet.”
To monetise on Brits’ appetite for cheap travel, Ryanair announced it was adding 21 routes to its UK winter schedule.
“As we continue to grow and add capacity in the UK, our customers have over 440 exciting winter sun, ski and city break destinations to choose from,” he said.
Despite the difficult financial backdrop, Ryanair expects to come out on top also because it has hedged out its fuel costs until March next year at $64 per barrel – which is 40 per cent lower than current prices.
According to the aviation executive, Ryanair will be insulated while the rest of the industry remains behind pre-pandemic traffic levels, at least until 2025.
Nevertheless, Ryanair will no longer be able to offer €10 fares due to hiking oil prices.
“I do think the €0.99 or €9.99 really cheap fares will probably be gone for the next couple of year while we’re all dealing with this kind of much higher oil prices,” he added.
“While our recovery and growth are very strong, it is still very fragile and is prone to falling over in the face of adverse developments.”
O’Leary also called on the UK Government to soften post-Brexit immigration regulations, blaming them for causing the UK’s “endemic” labour shortages that have plagued the summer season.
“What can and should be reversed is the stupidity of having a hard Brexit and no free-trade deal with the UK’s largest trading partner – the EU,” he said.
According to O’Leary, ministers should work on a trade agreement that would allow both UK and EU citizens to work freely in the continent.
“The sooner [hard Brexit] is reversed and we have a reasonable free trade agreement between the UK and Europe, the better will be for UK and EU companies.”