Michael O’Leary says more competition is driving cheaper fares but bemoans UK government’s lack of Brexit strategy. Ryanair’s chief executive has said fares in Europe will fall heavily this winter as he criticised Theresa May for having no strategy for Brexit.
Reporting results for the first half of the year, Michael O’Leary said there would be “extraordinary fare declines” over the year.
The short-haul airline’s average fare fell 10% in the six months to the end of September, partly due to the conversion of sterling fares, which account for a quarter of its revenues, into euros. It predicted average fares would drop by 13-15% in the six months to the end of March.
Ryanair said it cut fares in response to expansion by competitors and that lower fuel prices and cost cuts would help pay for the reductions. O’Leary said Ryanair would aim to fill seats at whatever price it could sell them to gain market share. The airline claims its average fare, with one checked bag, is now €46 (£41).
In the medium term, however, a hard Brexit would push up air fares, O’Leary said. “What is inevitable … is that there would be less capacity in the UK – and that means higher prices.”
He said the company’s first-half performance was creditable in a period marked by terrorist attacks, airport strikes and the effect of the Brexit vote. Pre-tax profit rose 6% to €1.31bn.