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Blerg
Topic Author
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Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 5:38 am

Good morning,

Seems like Ryanair is stepping up its fight against national airlines receiving state aid from their respective governments. It all started recently when the Austrian government expressed interest in financially supporting Austrian Airlines but not other airlines based in Austria (Lauda, Wizz Air and Level).

Now it seems the situation has escalated to such an extent that Ryanair is threatening the EU with legal action. From the article:

'Michael O’Leary, Ryanair’s chief executive, said in a letter to competition commissioner Margrethe Vestager that the European Union would be “forced into an embarrassing U-turn” on state aid if Ryanair won a legal challenge. The national programmes should be modified so that Ryanair could get a share of the bailout packages by making sure loan guarantees and other perks are available to “all EU airlines in proportion to their share of traffic in a particular country,” Mr O’Leary said in the April 9th letter seen by Bloomberg.'

To be honest this does seem like discrimination and they could potentially win in court especially in Austria. Austrian Airlines is actually a German company operating in Austria while Lauda is an Irish one also operating from Vienna. So how come one is eligible for state aid but the other isn't?

Let's see what becomes of this.

Source:
https://www.irishtimes.com/business/tra ... -1.4237144
 
fraT
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 5:44 am

As mentioned in another thread, OS is not a German airline. It's an airline registered and headquartered in Austria which is owned by LHG.
Also Wizz and Level are not bases in Austria. They are only operating from/to Austria.
 
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Dahlgardo
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 5:52 am

Blerg wrote:
Good morning,

Seems like Ryanair is stepping up its fight against national airlines receiving state aid from their respective governments. It all started recently when the Austrian government expressed interest in financially supporting Austrian Airlines but not other airlines based in Austria (Lauda, Wizz Air and Level).

Now it seems the situation has escalated to such an extent that Ryanair is threatening the EU with legal action. From the article:

'Michael O’Leary, Ryanair’s chief executive, said in a letter to competition commissioner Margrethe Vestager that the European Union would be “forced into an embarrassing U-turn” on state aid if Ryanair won a legal challenge. The national programmes should be modified so that Ryanair could get a share of the bailout packages by making sure loan guarantees and other perks are available to “all EU airlines in proportion to their share of traffic in a particular country,” Mr O’Leary said in the April 9th letter seen by Bloomberg.'

To be honest this does seem like discrimination and they could potentially win in court especially in Austria. Austrian Airlines is actually a German company operating in Austria while Lauda is an Irish one also operating from Vienna. So how come one is eligible for state aid but the other isn't?

Let's see what becomes of this.

Source:
https://www.irishtimes.com/business/tra ... -1.4237144


Another of MOLs specialties : a free publicity stunt
I admit he is good at it, but I wish journalists would use more of their critical senses and just ignore his continous, self rightious and self promoting drivel.
Ryanair has sucked many millions out of local airport and municipals and has been convicted in several countries for recieving illegal subsidies.
That airline has no class what so ever.
leave your nines at home and bring your skills to the battle
 
Jetty
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 5:56 am

He should ask the Irish government for support if needed, that’s where his company is located.
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:01 am

fraT wrote:
As mentioned in another thread, OS is not a German airline. It's an airline registered and headquartered in Austria which is owned by LHG.
Also Wizz and Level are not bases in Austria. They are only operating from/to Austria.


Both Wizz Air and Level have bases in Austria, more specifically at Vienna airport. Well the last time I checked LHG is a German company which owns Austrian Airlines making it a German company that operates in Austria.
 
ShamrockBoi330
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:07 am

Jetty wrote:
He should ask the Irish government for support if needed, that’s where his company is located.


And Austrian Airlines? Or are you deliberately and intentionally missing the the point of the OP?

Per wiki;

Austrian Airlines AG, sometimes shortened to Austrian, is the flag carrier of Austria and a subsidiary of the Lufthansa Group.

Lauda, legally Laudamotion GmbH (formerly Amira Air), is an Austrian low-cost airline[4] based in the Concorde Business Park in Schwechat, near Vienna, Austria.[5] It is from 2018 a subsidiary of Ryanair Holdings,

What's good for the goose....
 
fraT
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:10 am

Blerg wrote:
fraT wrote:
As mentioned in another thread, OS is not a German airline. It's an airline registered and headquartered in Austria which is owned by LHG.
Also Wizz and Level are not based in Austria. They are only operating from/to Austria.


Both Wizz Air and Level have bases in Austria, more specifically at Vienna airport. Well the last time I checked LHG is a German company which owns Austrian Airlines making it a German company that operates in Austria.


Again, OS is registered in Austria so it is not a German company. Same as Laudamotion is an Austrian company, owned by Ryanair. Wizz and Level are not Austrian companies.
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:14 am

fraT wrote:
Blerg wrote:
fraT wrote:
As mentioned in another thread, OS is not a German airline. It's an airline registered and headquartered in Austria which is owned by LHG.
Also Wizz and Level are not based in Austria. They are only operating from/to Austria.


Both Wizz Air and Level have bases in Austria, more specifically at Vienna airport. Well the last time I checked LHG is a German company which owns Austrian Airlines making it a German company that operates in Austria.


Again, OS is registered in Austria so it is not a German company. Same as Laudamotion is an Austrian company, owned by Ryanair. Wizz and Level are not Austrian companies.


So you just proved FR right and why it's discriminatory for OS to receive money from the state but not Lauda.

They might be Austrian based on where they are registered, but they are not Austrian if you look at the OWNERSHIP.
 
Andy33
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:17 am

Blerg wrote:
fraT wrote:
As mentioned in another thread, OS is not a German airline. It's an airline registered and headquartered in Austria which is owned by LHG.
Also Wizz and Level are not bases in Austria. They are only operating from/to Austria.


Both Wizz Air and Level have bases in Austria, more specifically at Vienna airport. Well the last time I checked LHG is a German company which owns Austrian Airlines making it a German company that operates in Austria.


And Level flies with an Austrian AOC, held by an Austrian registered company. Of course the company, originally Anisec, now Level Europe, is wholly owned vy Vueling which in turn is owned by IAG. So if O'Leary is correct, Level should get some of whatever money the Austrian government is splashing around too.

Note that Level flights from Paris use a French AOC and French registered company, and from Barcelona flights are opered by and under the AOC of Iberia. Amsterdam base is the outlier, that comes under the Austrian operation.
Last edited by Andy33 on Sun Apr 26, 2020 6:20 am, edited 1 time in total.
 
fraT
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:19 am

Blerg wrote:
fraT wrote:
Blerg wrote:

Both Wizz Air and Level have bases in Austria, more specifically at Vienna airport. Well the last time I checked LHG is a German company which owns Austrian Airlines making it a German company that operates in Austria.


Again, OS is registered in Austria so it is not a German company. Same as Laudamotion is an Austrian company, owned by Ryanair. Wizz and Level are not Austrian companies.


So you just proved FR right and why it's discriminatory for OS to receive money from the state but not Lauda.

They might be Austrian based on where they are registered, but they are not Austrian if you look at the OWNERSHIP.


Has Laudamotion requested Austrian state aid?
My opinion is that Laudamotion is entitled to also receive state aid from Austria. But of course this potential aid needs to be used for Laudamotion only and not to subsidize Ryanair. Same goes for OS and LHG.
 
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enzo011
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:20 am

Jetty wrote:
He should ask the Irish government for support if needed, that’s where his company is located.


Hey, don't drag Irish taxpayers into a Ryanair fight with the EU. :talktothehand: :biggrin:

As for this case, it does seem like MOL has a point, although we are only seeing one side of the argument right now which is theirs. As for the suggestion that bailout funds should be allocated by share in the market, well wouldn't you know that is the one way that benefits Ryanair massively above other airlines. Imagine having a low cost base in the countries you operate to and from but having a large share due to the savings you can make because you are able to offer cheap flights due to this lower cost base. Now you want the bigger share of bailout money while having a lower cost base? Who knew a company that is all about efficiencies would look to be efficient when there is the talk of bailout.

By all mean argue about the fairness of allowing only certain airlines the access to bailout funds as you have a better footing to argue for your side if you keep it simple.
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:26 am

fraT wrote:
Blerg wrote:
fraT wrote:

Again, OS is registered in Austria so it is not a German company. Same as Laudamotion is an Austrian company, owned by Ryanair. Wizz and Level are not Austrian companies.


So you just proved FR right and why it's discriminatory for OS to receive money from the state but not Lauda.

They might be Austrian based on where they are registered, but they are not Austrian if you look at the OWNERSHIP.


Has Laudamotion requested Austrian state aid?
My opinion is that Laudamotion is entitled to also receive state aid from Austria. But of course this potential aid needs to be used for Laudamotion only and not to subsidize Ryanair. Same goes for OS and LHG.


He said that Lauda doesn't need aid but if OS is getting it then they should be entitled to get 2/3 of what Austrian will receive. Austrian government mentioned €750 million so there we go, we have the amount Lauda will request.

Now we have to see what happens and if the Austrian government actually revises the amount it initially mentioned. The difference can be paid for by Lufthansa Group, after all, they were collecting the profits OS was making the past few years.
 
fraT
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:34 am

Blerg wrote:
fraT wrote:
Blerg wrote:

So you just proved FR right and why it's discriminatory for OS to receive money from the state but not Lauda.

They might be Austrian based on where they are registered, but they are not Austrian if you look at the OWNERSHIP.


Has Laudamotion requested Austrian state aid?
My opinion is that Laudamotion is entitled to also receive state aid from Austria. But of course this potential aid needs to be used for Laudamotion only and not to subsidize Ryanair. Same goes for OS and LHG.


He said that Lauda doesn't need aid but if OS is getting it then they should be entitled to get 2/3 of what Austrian will receive. Austrian government mentioned €750 million so there we go, we have the amount Lauda will request.

Now we have to see what happens and if the Austrian government actually revises the amount it initially mentioned. The difference can be paid for by Lufthansa Group, after all, they were collecting the profits OS was making the past few years.


Saying that they want two thirds of what OS (as part of LHG) is getting is just MOL blabla and cannot be taken seriously. Lauda has approx a third of OS' fleet size and less than a fifth of the number of employees. All airlines who are requesting state aid need to put the numbers on the table. Saying we want two thirds of what the competitor is getting is just his usual style to get into the news.

Edit: And which profits of OS in recent years are you talking about?
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 6:43 am

fraT wrote:
Blerg wrote:
fraT wrote:

Has Laudamotion requested Austrian state aid?
My opinion is that Laudamotion is entitled to also receive state aid from Austria. But of course this potential aid needs to be used for Laudamotion only and not to subsidize Ryanair. Same goes for OS and LHG.


He said that Lauda doesn't need aid but if OS is getting it then they should be entitled to get 2/3 of what Austrian will receive. Austrian government mentioned €750 million so there we go, we have the amount Lauda will request.

Now we have to see what happens and if the Austrian government actually revises the amount it initially mentioned. The difference can be paid for by Lufthansa Group, after all, they were collecting the profits OS was making the past few years.


Saying that they want two thirds of what OS (as part of LHG) is getting is just MOL blabla and cannot be taken seriously. Lauda has approx a third of OS' fleet size and less than a fifth of the number of employees. All airlines who are requesting state aid need to put the numbers on the table. Saying we want two thirds of what the competitor is getting is just his usual style to get into the news.

Edit: And which profits of OS in recent years are you talking about?


Well here's a tip for you, when negotiating always start with more than you know you can get. Ryanair knows that so obviously they will ask for an unrealistic sum of money so by the time they reach an agreement with the Austrian government they will get pretty much what they need, hence the 2/3 of what OS is getting.
Furthermore, don't forget that stalling the negotiating process also means OS will have to wait longer for the money to arrive meaning that an already bad situation will become worse and that even more money will be needed to keep the airline running.


In other news, Lufthansa Group to shrink by 100 planes and 10.000 employees.
https://www.airliners.de/abbau-stellen- ... ance/55026
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:33 am

Blerg wrote:
it's discriminatory for OS to receive money from the state but not Lauda.


Have they formally asked for state support?
Not through some tweed or a press release, but via the formal channels?
They can't possibly expect the Ministery of Finance to reply to just send them the bank account they want money on.
Have them start by compeling a file on how much is needed, what they want to use it for exactly and why the government should provide them with this sum.
Finally, are they willing to accept conditions attatched to this kind of aid too? On the way they operate, deal with their staff and will spend any future profits?
I suppose the Greens in the Austrian coalition might have some interesting questions regarding the environmental sustainablily and the true ecologic cost of ultra cheap flights to Ibiza, for instance. Are they willing to engage in this kind of painful discussions on the fundaments of their business model and radically change it if the government wants so (for instance through minimum ticket prices to reflect the true environmental cost of flying)?
If not, then obviously they lock themselves out of any financial help and shouldn't cry foul over not getting it!
 
jomur
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:46 am

People seems to be missing the point. Ryanair wants tbe principle to be if they offer aid to one airline they cannot then refuse to give it to another airline either for what ever reason, and it would apply to the whole EU so Germany, France and Netherlands etc.. It could also spill over into over industries as well.
If the EU wants to keep its principles and to survive after this crisis then the rules have to apply to every one otherwise I can see the whole EU falling a part...
 
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Embajador3
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:47 am

This guy is pathetic. FR had illegal subsidies from various regional goverments, so that FR would operate from their airports, and now he complains at the possibility of OS getting funds from the austrian goverment?
I admit it, I think all austrian operators should be eligible for this aid (unless their business were failing before this crisis), but contrary to OS, Ryanair Holdings is not committed to an airport/country, they are there only to make money or they leave. OS are committed to connect Austria to the rest of the world.
In the other hand, Lauda is losing money, otherwise they would not had asked their staff to take paycuts or have the airline closed down by 30th of May, and thus give FR all routers from VIE.
Flying Together
 
devron
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:55 am

There should be an EU bail-out package with money going to the 5 or 10 or xx airlines that fit certain criteria (e.g. carbon per passenger, number of system relevant connections, return likelyhood of the bailout ect.). This national bailout is not usefull.
 
CometOrbit
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:58 am

EasyJet Europe (EC) is also based in Austria, with (according to Wiki) 140 aircraft based there, and employing all of EasyJet's non-UK staff based across the EU.
So you'd expect the airline to have some claim on any aviation support funds offered by the Austrian government.
The EU should also be supporting pan-EU operators, if "open skies" means anything at all in the single market.
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:58 am

jomur wrote:
People seems to be missing the point. Ryanair wants tbe principle to be if they offer aid to one airline they cannot then refuse to give it to another airline either


People are not missing the point at all.
Yet the simple question is: have they formally asked for it?
And are they willing to engage in talks on the conditions that will be attached to it?
It seems not and for a good reason: they will likely not be to the liking of MOL, so he's voluntarily refusing to sit down, engage in serious talks and thus rejecting the money himself!
You can lead a horse to water, but you cannot make it drink.
Last edited by sabenapilot on Sun Apr 26, 2020 8:03 am, edited 2 times in total.
 
LJ
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 7:58 am

sabenapilot wrote:
Blerg wrote:
it's discriminatory for OS to receive money from the state but not Lauda.


Have they formally asked for state support?
Not through some tweed or a press release, but via the formal channels?
They can't possibly expect the Ministery of Finance to reply to just send them the bank account they want money on.
Have them start by compeling a file on how much is needed, what they want to use it for exactly and why the government should provide them with this sum.
Finally, are they willing to accept conditions attatched to this kind of aid too? On the way they operate, deal with their staff and will spend any future profits?
I suppose the Greens in the Austrian coalition might have some interesting questions regarding the environmental sustainablily and the true ecologic cost of ultra cheap flights to Ibiza, for instance. Are they willing to engage in this kind of painful discussions on the fundaments of their business model and radically change it if the government wants so (for instance through minimum ticket prices to reflect the true environmental cost of flying)?
If not, then obviously they lock themselves out of any financial help and shouldn't cry foul over not getting it!


In another thread is was noted that MOL doesn't want to comply with letting the middle seat open ( https://www.airliners.net/forum/viewtopic.php?f=3&t=1445045 ). Ryanair just lost a court case and must reinstate some Spanish employees. All airlines which received money got some conditions attached to it, none which Ryanair would probably willing to accept. Moreover, in order to receive state aid you must comply with the conditions. If you don't comply, you don't get it. If you do, you get it. It's very simple. When Laudamotion says they don't need assistance, why would they then be eligible? All state aid needs to be repaid anyway. Finally, what's the added benefit anyway of Ryanair for a country? I dooubt they could be classified as "essential", which most parts of airlines like OS, AF and KL are. Then again, these airlines should be forced to shrink to a level that they perform their essential services, thus no 5 dailies to BCN if other airlines can do that as well. Ryair could then decide if it wants to serve such non-essential markets.
 
LJ
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 8:03 am

Embajador3 wrote:
In the other hand, Lauda is losing money, otherwise they would not had asked their staff to take paycuts or have the airline closed down by 30th of May, and thus give FR all routers from VIE.


Which wasn't a smart statement if you want to receive monney from the Austrian state......
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 8:07 am

LJ wrote:
It was noted that MOL doesn't want to comply with letting the middle seat open ( https://www.airliners.net/forum/viewtopic.php?f=3&t=1445045 ). Ryanair just lost a court case and must reinstate some Spanish employees. All airlines which received money got some conditions attached to it, none which Ryanair would probably willing to accept. Moreover, in order to receive state aid you must comply with the conditions. If you don't comply, you don't get it. If you do, you get it. It's very simple.


Indeed LJ.

MOL thinks he should get public money without conditions at all, or at the very least at favourable conditions he can dictate, like he's so used to at regional airports; sadly for him this is not how it will be done this time: strict conditions will be added to any public funds provided to airlines, notably on social, environmental and ecological topics for which MOL seems to have an unique personal aversion.

Going around telling everybody you do not want to comply with new public sanitary rules like flying with the middle seat blocked, do not want to work on environmental sustainablity of aviation by subscribing to a minimum ticket price, are against caping traffic numbers to saturated places AND at the same time expecting society to fund you in your quest against the common good out of a drive for ever greater personal profit, is rather inconsistent, to say the least.
 
Toinou
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 8:23 am

Blerg wrote:
making sure loan guarantees and other perks are available to “all EU airlines in proportion to their share of traffic in a particular country,”


This an interesting aspect of his declaration. If put in application at national level, it would mean that any EU airline serving a country would be able to receive help. It would probably be easier to implement on EU level but it still is an interesting.
But I'm sure in this case it would come with conditions, like the airline being somewhat regulated on the service it's offering. I would love to see Ryanair having to discuss what service to deliver in exchange for subsidy not with a demanding and rather powerless regional government but with the EU bureaucracy or a national government. That may be interesting to look at as MOL would probably, for once, find someone who could give response to his tantrums.
 
Waterbomber2
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:09 am

As discussed in the Lufthansa subsidy thread, the EU is a unified market.
Austrian Airlines for instance has no domestic flights, so all their flights are from Austria to another country.
So if the Austrian government helps OS, they can't reject requests from other airlines who are competing against OS.

The US is bailing out all its airlines with a common standard, in the EU it seems that some airlines/countries are trying to use government funds to gain a competitive edge over their competitors by taking advantage of a chaotic situation.

In fact, considering that airlines compete globally, the WTO should be building the framework for the bailouts before this becomes a competition.
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:34 am

Toinou wrote:
Blerg wrote:
making sure loan guarantees and other perks are available to “all EU airlines in proportion to their share of traffic in a particular country,”


This an interesting aspect of his declaration. If put in application at national level, it would mean that any EU airline serving a country would be able to receive help. It would probably be easier to implement on EU level but it still is an interesting.
But I'm sure in this case it would come with conditions, like the airline being somewhat regulated on the service it's offering. I would love to see Ryanair having to discuss what service to deliver in exchange for subsidy not with a demanding and rather powerless regional government but with the EU bureaucracy or a national government. That may be interesting to look at as MOL would probably, for once, find someone who could give response to his tantrums.


To MOL the conditions likely attached are simply unacceptable, so he declines to discuss the matter, puts his Calimero hat on and complains how he's not getting any money!
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:36 am

sabenapilot wrote:
Blerg wrote:
it's discriminatory for OS to receive money from the state but not Lauda.


Have they formally asked for state support?
Not through some tweed or a press release, but via the formal channels?
They can't possibly expect the Ministery of Finance to reply to just send them the bank account they want money on.
Have them start by compeling a file on how much is needed, what they want to use it for exactly and why the government should provide them with this sum.
Finally, are they willing to accept conditions attatched to this kind of aid too? On the way they operate, deal with their staff and will spend any future profits?
I suppose the Greens in the Austrian coalition might have some interesting questions regarding the environmental sustainablily and the true ecologic cost of ultra cheap flights to Ibiza, for instance. Are they willing to engage in this kind of painful discussions on the fundaments of their business model and radically change it if the government wants so (for instance through minimum ticket prices to reflect the true environmental cost of flying)?
If not, then obviously they lock themselves out of any financial help and shouldn't cry foul over not getting it!


The Greens might think first of what implications their actions might have if their voters have to pay higher airfares. Greens will speak of ecology but they won't do something that might damage their results during the next election. They also didn't do anything when OS was supposed to receive the funds despite saying how there should be ecological conditions on receiving aid.

As for the Austrian government, well, maybe the first step should have been to build a framework through which ALL Austrian airlines can apply for aid in stead of making separate deals with one,foreign, airline in the country. So if anyone is to be blamed here then it's the government, not Lauda.
 
Blerg
Topic Author
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:41 am

LJ wrote:
sabenapilot wrote:
Blerg wrote:
it's discriminatory for OS to receive money from the state but not Lauda.


Have they formally asked for state support?
Not through some tweed or a press release, but via the formal channels?
They can't possibly expect the Ministery of Finance to reply to just send them the bank account they want money on.
Have them start by compeling a file on how much is needed, what they want to use it for exactly and why the government should provide them with this sum.
Finally, are they willing to accept conditions attatched to this kind of aid too? On the way they operate, deal with their staff and will spend any future profits?
I suppose the Greens in the Austrian coalition might have some interesting questions regarding the environmental sustainablily and the true ecologic cost of ultra cheap flights to Ibiza, for instance. Are they willing to engage in this kind of painful discussions on the fundaments of their business model and radically change it if the government wants so (for instance through minimum ticket prices to reflect the true environmental cost of flying)?
If not, then obviously they lock themselves out of any financial help and shouldn't cry foul over not getting it!


In another thread is was noted that MOL doesn't want to comply with letting the middle seat open ( https://www.airliners.net/forum/viewtopic.php?f=3&t=1445045 ). Ryanair just lost a court case and must reinstate some Spanish employees. All airlines which received money got some conditions attached to it, none which Ryanair would probably willing to accept. Moreover, in order to receive state aid you must comply with the conditions. If you don't comply, you don't get it. If you do, you get it. It's very simple. When Laudamotion says they don't need assistance, why would they then be eligible? All state aid needs to be repaid anyway. Finally, what's the added benefit anyway of Ryanair for a country? I dooubt they could be classified as "essential", which most parts of airlines like OS, AF and KL are. Then again, these airlines should be forced to shrink to a level that they perform their essential services, thus no 5 dailies to BCN if other airlines can do that as well. Ryair could then decide if it wants to serve such non-essential markets.


I am sorry but how exactly is Austrian Airlines essential? Most of their routes have competition meaning that even if they were to go away the market would not suffer. This by definition doesn't make them essential, especially since they are not even an Austrian owned company.

Lauda is more essential than Austrian Airlines simply because they have a healthier business model which doesn't require them to be continuously financed by someone else. Pretty simple. So what value does Austrian Airlines bring to Austria that others couldn't compensate? Especially now when they are about to shrink by 20 aircraft and when they will start firing their employees.
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:43 am

Dahlgardo wrote:
Another of MOLs specialties : a free publicity stunt
I admit he is good at it, but I wish journalists would use more of their critical senses and just ignore his continous, self rightious and self promoting drivel.
Ryanair has sucked many millions out of local airport and municipals and has been convicted in several countries for recieving illegal subsidies.
That airline has no class what so ever.

Ryanair hasn't ever got money out of airports and local communities that those Airports or communities wouldn't have willingly given to another carrier if they were willing to avail of it.
There is a world of a difference between the aid which Ryanair has received and these subsidies.
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:45 am

Blerg wrote:
The Greens might think first of what implications their actions might have if their voters have to pay higher airfares. Greens will speak of ecology but they won't do something that might damage their results during the next election. They also didn't do anything when OS was supposed to receive the funds despite saying how there should be ecological conditions on receiving aid.

As for the Austrian government, well, maybe the first step should have been to build a framework through which ALL Austrian airlines can apply for aid in stead of making separate deals with one,foreign, airline in the country. So if anyone is to be blamed here then it's the government, not Lauda.


Are you now saying governments should long have set up generic mechanisms to bail out airlines?
If this would have been announced just 6 months ago, what do you think Lauda/MOL would have said about such a plan?
But if they now suddenly think it is such a good idea after all, let them work together with other Austrian airlines and the Austrian government in establishing such a national bail-out fund, meaning they will have to discuss conditions of common interest applicable to all participants to benefit from the fund, as well as propose ways to finance the fund in future, for instance through an additional levy on tickets or a significant share of any future profits of all airlines, let's say 5 to 10 euro per leg or so.
No problem for MOL, I suppose? ;)
 
Blerg
Topic Author
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:51 am

sabenapilot wrote:
Blerg wrote:
The Greens might think first of what implications their actions might have if their voters have to pay higher airfares. Greens will speak of ecology but they won't do something that might damage their results during the next election. They also didn't do anything when OS was supposed to receive the funds despite saying how there should be ecological conditions on receiving aid.

As for the Austrian government, well, maybe the first step should have been to build a framework through which ALL Austrian airlines can apply for aid in stead of making separate deals with one,foreign, airline in the country. So if anyone is to be blamed here then it's the government, not Lauda.


Are you now saying governments should long have set up generic mechanisms to bail out airlines?
If this would have been announced just 6 months ago, what do you think Lauda/MOL would have said about such a plan?
But if they now suddenly think it is such a good idea after all, let them work together with other Austrian airlines and the Austrian government in establishing such a national bail-out fund, meaning they will have to discuss conditions of common interest applicable to all participants to benefit from the fund when they feel the need, as well as propose ways to finance the fund in future, for instance through an additional levy on tickets or a protion of future profits of airlines, let's say 5 to 10 euro per leg or so.
No problem for MOL, I suppose? ;)


Setting up a bailout fund is pretty stupid because various governments would pillage it for other needs like they do with pension funds and so on. What the Austrian government should have done is to have invited ALL local airlines and discussed with them what should and can be done to help them out. In stead, what they did was that they only invited Austrian Airlines and formed a joint approach when discussing a bailout with Lufthansa. In such a way they have directly discriminated against other airlines there.

Austrian government informed LH that they don't want VIE de-hubbed if they are to provide funds. Why haven't they formed a similar approach with Lauda before sitting down with Ryanair? It's double standards and as such they could easily lose their case in court.
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:55 am

Blerg wrote:
I am sorry but how exactly is Austrian Airlines essential? Most of their routes have competition meaning that even if they were to go away the market would not suffer. This by definition doesn't make them essential, especially since they are not even an Austrian owned company.

Lauda is more essential than Austrian Airlines simply because they have a healthier business model which doesn't require them to be continuously financed by someone else. Pretty simple. So what value does Austrian Airlines bring to Austria that others couldn't compensate? Especially now when they are about to shrink by 20 aircraft and when they will start firing their employees.


Until a couple of months ago, most people thought is was a smart idea to outsource the handling of commodities and basic sanitary goods like simple mouth masks to companies in the PRC too, because those were produced by very competitive, way healtheir businesses than our local producers too... and then came along a little virus and every western country suddenly found itself scrambling to get enough supplies, because those cheaper alternatives to the non-essential local companies suddenly showed to be unreliable and even completely absent in the moment we most needed them...
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 9:59 am

Connected companies with access to the levers of power in their respective Countries pilfer the pockets of the taxpayer and all some people want to do is kick Ryanair who had the foresight to save for a rainy day.
Moral Hazard much???
 
sabenapilot
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:04 am

Blerg wrote:
sabenapilot wrote:
Blerg wrote:
What the Austrian government should have done is to have invited ALL local airlines and discussed with them what should and can be done to help them out. In stead, what they did was that they only invited Austrian Airlines and formed a joint approach when discussing a bailout with Lufthansa. In such a way they have directly discriminated against other airlines there.

Austrian government informed LH that they don't want VIE de-hubbed if they are to provide funds. Why haven't they formed a similar approach with Lauda before sitting down with Ryanair? It's double standards and as such they could easily lose their case in court.


Why should talks with different Austrian airlines be conducted all together by the government?
Different airlines have different business models, different needs and can likely also expect different conditions in return for state support: I doubt it's efficient to organize one single round table conference for all those.
The Austrian government has indeed engaged with Austrian Airlines; is there any refusal by the Austrian government documented to also sit down with others like Lauda and see if they can work out a specific agreement with them too? I haven't seen such a refusal! Have you? All there is is a silly demand to just automatically get a percentage of the sum Austrian will be getting, in return for basically nothing at all! Now that would be really bad governance by the government if it were to be awarded!
 
L410Turbolet
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:04 am

CometOrbit wrote:
The EU should also be supporting pan-EU operators, if "open skies" means anything at all in the single market.

Why? Their erratic, hit-and-miss opening and shutting down (with necessary media tantrums) of routes serves no greater good.
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:07 am

L410Turbolet wrote:
CometOrbit wrote:
The EU should also be supporting pan-EU operators, if "open skies" means anything at all in the single market.

Why? Their erratic, hit-and-miss opening and shutting down (with necessary media tantrums) of routes serves no greater good.

If these parasitic incumbents stepped aside you would see the LCCs who aren't feasting on taxpayer money occupying those attractive city pairs.
 
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Francoflier
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:55 am

This is particularly ironic, considering that one of FR's modus operandi was to extort European states, regions and cities for subsidies in exchange for service to these places and 'jobs'...
I'll do my own airline. With Blackjack. And hookers. In fact, forget the airline.
 
AirwayBill
Posts: 175
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:57 am

Dahlgardo wrote:
Another of MOLs specialties : a free publicity stunt
I admit he is good at it, but I wish journalists would use more of their critical senses and just ignore his continous, self rightious and self promoting drivel.


Why should they? That's how the media makes business.
They work together perfectly.
Last edited by AirwayBill on Sun Apr 26, 2020 10:58 am, edited 1 time in total.
 
Blerg
Topic Author
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 10:57 am

sabenapilot wrote:
Blerg wrote:
I am sorry but how exactly is Austrian Airlines essential? Most of their routes have competition meaning that even if they were to go away the market would not suffer. This by definition doesn't make them essential, especially since they are not even an Austrian owned company.

Lauda is more essential than Austrian Airlines simply because they have a healthier business model which doesn't require them to be continuously financed by someone else. Pretty simple. So what value does Austrian Airlines bring to Austria that others couldn't compensate? Especially now when they are about to shrink by 20 aircraft and when they will start firing their employees.


Until a couple of months ago, most people thought is was a smart idea to outsource the handling of commodities and basic sanitary goods like simple mouth masks to companies in the PRC too, because those were produced by very competitive, way healtheir businesses than our local producers too... and then came along a little virus and every western country suddenly found itself scrambling to get enough supplies, because those cheaper alternatives to the non-essential local companies suddenly showed to be unreliable and even completely absent in the moment we most needed them...


The only difference is that those outsourced companies failed in times of crisis, Ryanair isn't. You are comparing apples to oranges here.
 
Blerg
Topic Author
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 11:03 am

sabenapilot wrote:
Blerg wrote:
sabenapilot wrote:


Why should talks with different Austrian airlines be conducted all together by the government?
Different airlines have different business models, different needs and can likely also expect different conditions in return for state support: I doubt it's efficient to organize one single round table conference for all those.
The Austrian government has indeed engaged with Austrian Airlines; is there any refusal by the Austrian government documented to also sit down with others like Lauda and see if they can work out a specific agreement with them too? I haven't seen such a refusal! Have you? All there is is a silly demand to just automatically get a percentage of the sum Austrian will be getting, in return for basically nothing at all! Now that would be really bad governance by the government if it were to be awarded!


So what you are saying is that government plans for small businesses are bad because they are not sitting down with each one of them to make a plan that suits them the most? Let's face it, airline business is basically similar and they would all be after the same thing in the end: tax breaks and access to additional funding.

What Ryanair is saying is that if a German airline in Austria is to receive money then the Irish one should too. Ryanair is not insisting on 2/3, they are merely proposing a fair solution otherwise there is going to be a lawsuit coming their way. Personally I don't see what's so controversial here. I could have understood if Austrian Airlines was Austrian owned but they are not. The real question we should be asking ourselves is what will the money do for OS? Will it merely keep it alive so that it can keep on struggling or will there be concrete requirements for them to reform themselves in order to achieve profitability? So far it seems it's all about surviving and making it out alive.
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 11:08 am

Francoflier wrote:
This is particularly ironic, considering that one of FR's modus operandi was to extort European states, regions and cities for subsidies in exchange for service to these places and 'jobs'...

Extort? Were they blackmailing Government Officials in compromising positions? You are shaping a narrative that is far removed from reality.
 
mxaxai
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 11:53 am

Blerg wrote:
He said that Lauda doesn't need aid but if OS is getting it then they should be entitled to get 2/3 of what Austrian will receive. Austrian government mentioned €750 million so there we go, we have the amount Lauda will request.

OS will need to repay the 750 mln € + interest. Same for LH, DE, AF, KL and any other business that asks for such loans. Likely with strings attached like limits on share dividends and management bonuses. FR and Lauda know perfectly well why they would rather go without this "support".
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 11:56 am

If it is a loan at less than "commercial" rates and with laxer terms then every competitor who isn't receiving the loans has genuine reason to complain.
 
LJ
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 12:20 pm

Blerg wrote:
I am sorry but how exactly is Austrian Airlines essential? Most of their routes have competition meaning that even if they were to go away the market would not suffer. This by definition doesn't make them essential, especially since they are not even an Austrian owned company.


Essential in the sense that without the airlinks the econimy would have adverse affect. This means an airline which hauls cargo and thus ensures that companies can deliver their goods both within Europe as outside has more value than leisure oriented routes. You can decide that you want to rely on companies from outside your country only, but given the current situation I feel there is some justiication to help arlines which have showed that they can have a profitable business case without COVID-19. However, the bailout should mean that it's not spend on routes which are non-essential (thus leisure oriented routes).

Blerg wrote:
The Greens might think first of what implications their actions might have if their voters have to pay higher airfares. Greens will speak of ecology but they won't do something that might damage their results during the next election. They also didn't do anything when OS was supposed to receive the funds despite saying how there should be ecological conditions on receiving aid.


I doubt the the electorate is against higher airfares. As fars as they are concerned they would not favour a baliout as the less aviation the better for them.
 
Kilopond
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 12:22 pm

Dahlgardo wrote:
Another of MOLs specialties : a free publicity stunt [...]


And he is bending the truth to the utmost, just not to call him a liar. As a matter of fact, his Lauda crews based in Vienna VIE, Stuttgart STR and Düsseldorf DUS are on the payrolls of the respective governments while technically staying employed at the Ryanair subsidary. The plan is called short hours work, while "short“ means zero these days.
 
Blerg
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 12:36 pm

LJ wrote:
Blerg wrote:
I am sorry but how exactly is Austrian Airlines essential? Most of their routes have competition meaning that even if they were to go away the market would not suffer. This by definition doesn't make them essential, especially since they are not even an Austrian owned company.


Essential in the sense that without the airlinks the econimy would have adverse affect. This means an airline which hauls cargo and thus ensures that companies can deliver their goods both within Europe as outside has more value than leisure oriented routes. You can decide that you want to rely on companies from outside your country only, but given the current situation I feel there is some justiication to help arlines which have showed that they can have a profitable business case without COVID-19. However, the bailout should mean that it's not spend on routes which are non-essential (thus leisure oriented routes).

Blerg wrote:
The Greens might think first of what implications their actions might have if their voters have to pay higher airfares. Greens will speak of ecology but they won't do something that might damage their results during the next election. They also didn't do anything when OS was supposed to receive the funds despite saying how there should be ecological conditions on receiving aid.


I doubt the the electorate is against higher airfares. As fars as they are concerned they would not favour a baliout as the less aviation the better for them.


Let me repeat it once again, if OS was to go out of business, the impact on VIE and Austria would not be that bad as most of the routes they fly on already have competition. Austrian Airlines has a 45% marketshare at VIE while a large portion of their passengers are transfers. So the number of locals using them are what? 20% to 25% of the traffic at Vienna airport? Not that big.

Also, let's not forget that in normal circumstances, Austrian Airlines still struggles. That's one of the reasons why LH Group refused to invest in new, eco friendlier, long-haul aircraft.

As for the Greens, from what I know they still use the plane to go for holidays and so on. The moment fares would go up they would be faced with growing discontent at home.

Air Malta is a good example of an essential airline, not Austrian Airlines.
 
ltbewr
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 12:42 pm

MOL is just trying to get his cut of the trough of money being handed out by governments, but he may have a point. Once it is reasonably safe to travel post-Covid-19 many countries will be in massive need to restore their tourism industries and will want Ryanair and their LCC's with cheap fares. It might be in their best interest to help Ryanair although it should have conditions as to labor rights and some offsets for previous subsidies.
 
MIflyer12
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 12:54 pm

Waterbomber2 wrote:
As discussed in the Lufthansa subsidy thread, the EU is a unified market.


The EU is a unified market without unified taxation or governance. This is what you can expect from such fragmentation. France and Germany aren't going to wait and wade through the negotiations for a common EU policy before they secure the finances (and job counts) at AFKL and LH.

If Ryanair were based in France and had a meaningful number of employees on French labor contracts and serving French destinations, he would have no fear of being excluded from French aid. The Irish just don't have the deep pockets (or commitment) of the French state. He can enjoy that low tax/light regulation haven right to the bitter end.
 
leghorn
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 1:01 pm

Temporarily laid off Irish staff are getting 350 euro a week; hat is fair Government support. It goes to the citivzen.
As has been shown in the past, if a government pushes a policy or channels grants to a local company at the expense of other companies competing in the same marketplace then those competitors if they are big enough eventually get their day in court and have a fighting chance of getting compensation.
 
sabenapilot
Posts: 3289
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Re: Ryanair Threatens EU Over State Aid to Airlines

Sun Apr 26, 2020 1:02 pm

Blerg wrote:
sabenapilot wrote:
Blerg wrote:


Why should talks with different Austrian airlines be conducted all together by the government?
Different airlines have different business models, different needs and can likely also expect different conditions in return for state support: I doubt it's efficient to organize one single round table conference for all those.
The Austrian government has indeed engaged with Austrian Airlines; is there any refusal by the Austrian government documented to also sit down with others like Lauda and see if they can work out a specific agreement with them too? I haven't seen such a refusal! Have you? All there is is a silly demand to just automatically get a percentage of the sum Austrian will be getting, in return for basically nothing at all! Now that would be really bad governance by the government if it were to be awarded!


So what you are saying is that government plans for small businesses are bad because they are not sitting down with each one of them to make a plan that suits them the most?


Ideally yes, the government would have to tailor make each loan, but for a one-man limited or an SME this is sadly not possible; however, for multi-nationals it is and so it should be done to maximize the ROI. I'm sure you agee with me every government euro is to be spent as wisely as possible?

Allow me to point out something rather strange in your posts: one moment you're agry because conditions attached to the government loan for OS are not clear to you and do not seem to offer the creditor anything meaningful in your personal view, yet the very next moment -as a remedy- you want the same goverment to double down on this faulty principle by giving more money to another airline, with even less conditions attached to it (if any)? :scratchchin:

2 wrongs generally dont make a right if you truly believe in what you're preaching, unless the second one suddenly is in your own personal interest, of course... :sarcastic:

The conclusion is that for airlines there clearly is no automatism to public funding and rightfully so!
OS thus sat down with the government of Austria and they both hammered out a mutually satisfying tailor made deal.
If other airlines in Austria want to obtain similar help as OS, let them start by presenting a business case for such financial help to the government like OS did, rather than demand they can just piggy back on the business case of a competitor
If the case is there for them too, I'm sure the government will consider it with an open mind in return for certain commitments of common interests of course, yet it seems this is the biggest problem: Lauda (and Ryanair) seem not to be willing to commit to this very basic principle in return for public funds.
Don't expect any funding if you're not willing to at least try to be accomodating to some very valid demands.
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