Thought that now might be a nice time to sum up Ryanair considering all what has occurred in the past two weeks: Acquisition of Buzz, 100 B737-800 order, new Stockholm base announced and Milan-Bergamo base launched.
London Stansted / 49 routes
Dublin / 17 routes
Frankfurt-Hahn / 15 routes / inaugurated 2002
Brussels-Charleroi / 10 routes / inn. 2001
Glasgow-Prestwick / 8 routes
Stockholm-Skavsta / 8 routes / to be inn. 2003
Milan-Bergamo / 7 routes / inn. 2003
Shannon / 4 routes
Some facts from various files on Ryanair.com:
- Currently has more than €1 billion cash.
- 94% of tickets currently sold on Ryanair.com
- Growth running at approximately 30% per annum.
- Average Ryanair fare (per segment, excluding taxes) is €49, compared to €89 / easyJet, €102 Air Berlin, €114 Dba and €131 Germanwings.
- Ryanair operating margins are over 25%, easyJet’s are 9% while most traditional airlines only have operating of a less than 5%.
Estimated passengers next year, 24 million with 30%-35% growth, perhaps beating the current European number 3, Air France! 6 new bases and 40+ airports are in the pipeline for the near future (source Ryanair slideshow) so is it even unrealistic to imagine a 250 aircraft “largest European carrier” Ryanair by 2010? Perhaps not….
Just looking at the map of current Ryanair destinations, one can easily imagine the following bases:
- Paris: sooner rather than later with the end of AirLib.
- Southern French base, perhaps Carcasonne?
- An Austrian hub (Salzburg?)
Their current bases/future will never grow to the scale of Stansted but a figure of 10-15 aircraft at each is entirely possible. Many non-base airports will probably get multiple daily Ryanair services (even if it is only 1x to each hub), a service level they could never have dreamed about in the past. Look at Pisa nowadays, while it is not a base, there 3 destinations served (7 daily flights).
Ryanair expansion is considerably easier than other LCC’s. When easyJet starts a new route, it almost always competes directly with a traditional carrier while Ryanair routes have little direct competition.
Eastern Europe: With so many new countries joining the EU, it can be expected that most European airlines will want a piece of the pie. With the measurable lower incomes and increased price-sensitivity, Ryanair will probably be the best-positioned carrier. Basing a few aircraft in one/a few of the new members states would probably also be a wise move. Tara Aerospace (either a Ryanair subsidiary or a company owned by the Ryanair founder, Tony Ryan) has purchased an airport not far from Prague.
One probably issues is that a locally based LCC could probably achieve costs as low, if not lower than Ryanair, at least in the short term.
Transit Passengers: Allowing connections between flights at their major hubs. No baggage transfer or anything else, simply to ability to book a flight from A to C via B in a single booking with a minimum connection time of (say) 2 hours. If connection is missed, Ryanair puts passengers on the next available flight without fee but obviously does provide compensation, accommodation or anything else.
Buzz: There is no doubt in my mind that the key reason Ryanair bought Buzz is for Stansted slots. Anything extra that they get out of the deal can be considered a bonus. Buzz apparently had around 15% of total slots and with the airport not too far from capacity at peak times, these could be vital in the long term. Stansted will probably get an extra runway but that will come in 2010-12 at the earliest. (Delayed white paper, years it takes between planning and construction, plenty of local pressure groups… )
Employees: The one issue I have with Ryanair is that they tend to employ the most obnoxious bunch of employees possible, be it flight attendants or ground staff (although ground handling is outsourced at many airports). They really need to be thought some basic skills such as using tact while dealing with passengers. Training is expensive but the long-term benefits are immeasurable, just look a Southwest and its “friendly” image.
Technology: I don’t really see Ryanair installing PTVs due to the relative short duration of most flights, maintenance (even just keeping the screens clean daily), earphone handling, and the added weight. However, perhaps a Connexion by Boeing system? I am not sure of the exact technology involved (weight? installation?) but I presume it is lighter and easier to install. Growing numbers of people are purchasing laptops (dropping in price) and internet hotspots are mushrooming throughout Europe. Being the first carrier to have Internet on every aircraft (by say 2005) would certainly be a lure for business passengers.
I also see Ryanair using other technology such as Internet check-in, airport check-in kiosks etc. in the longer-term. While this would go against current policies such as keeping everything “as simple as possible”, it would provide savings, not to mention the benefits to passengers.
Free seats promotions: There is often much concern expressed about the Ryanair free seat promotions, well the following quote from a January 2003 Raymond James shareholders company brief is worth a read:
“However, RYAAY’s free ticket program should boost earning, in our estimation, in fiscal 3Q03 because (1) passengers had to book their tickets through the internet using a credit card, which entails a fee of €6 on each booking, and does not cost much for RYAAY and (2) it is expected to generate substantial other high-profit-margin ancillary revenue from hotel purchases, car rentals and on-board sales of drinks and merchandise. Since these free seats are during off peak times and during a seasonally slow period, we think the majority would have gone unsold anyway”
Operational Reliability: One area Ryanair has to work on at least ensuring that its aircraft and main bases are CATIII compatible. The number of passengers inconvenienced by mere fog at a base is nothing short of ridiculous.
Well that’s just my vision for a 2010 Ryanair. I really look forward to hearing what you think and what your vision for the company is?
[Edited 2003-02-08 20:54:45]
Goodbye SR-LX MD-11 / 6th of March 1991 to the 31st of October 2004