Ryanair: the Tesco of the skies
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Ireland’s no-frills airline Ryanair has been aiming to become the “Tesco of the skies”, said Harry Wallopin The Daily Telegraph.
The plan “is working fine”, with pre-tax profits up by 22% to a record e270m in the six months to the end of September as passenger numbers jumped by 29%; this financial year, Ryanair expects to carry 35 million passengers, which would make it Europe’s biggest airline by passenger numbers. The group’s net margin of 20% is no mean feat, given that the fuel bill doubled over the half year.
Ryanair is also successfully tapping new revenue streams, said Terry Macalister in The Guardian. Sales of “extras”, such as car rental and hotel bookings, jumped by 36%, Ryanair will also soon introduce onboard internet gambling. Unlike its customers, however, is seems unlikely to lose money, said Lex in the FT. Ryanair has kept costs down by doing much of its marketing online and introducing larger aircraft.
The key, however, has been low staff costs, which comprise just 13% of overall expenses, compared to 33% at BA.Airport and handling charges now look set to rise, while fuel will continue to be a drag, even though Ryanair has hedged 90% of its requirement at $49 for the next six months. All in all, however, “prospects look good”.
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