Ryanair: British Airways-BMI Merger Opens Short-Haul Market

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Over the winter months, Ranayair will receive 30 Boeing 737-800s. (Photo: Stock.xchng)
Over the winter months, Ranayair will receive 30 Boeing 737-800s. (Photo: Stock.xchng)

BUSINESS

  • Ryanair to buy 200 planes to boost passenger numbers 75%
  • Airline may look to Chinese 199-seat aircrafts to boost profits
  • Ryanair tops airlines index, quarterly net revenue up 20%

Irish airline Ryanair hopes to step up to cover short-haul routes after a merger of British Airways and Deutsche Lufthansa AG’s BMI segment leave an opening into the market.

Boeing is expected to make a proposal to Ryanair in November for the airline’s re-engined 737 single-aisle jet. Ryanair, the leading discount airline in the EU, plans to purchase up to 200 planes in a bid to boost passenger numbers 75% to 130 million within the next ten years. The airline is already awaiting almost 45,000 deliveries. The BA-Lufthansa merger will see BMI concentrate on long-haul flights, leaving short-haul EU routes open.

Over the winter months, Ranayair will receive 30 Boeing 737-800s. Though its fleet is currently all Boeing, Ryanair may order from China following an agreement concerning the development of the C919. Ryanair’s Boeing aircrafts have 188 seats whereas the Chinese are aiming for a 199-seat aircraft.

Central Airports Added

Ryanair hopes to post net revenue of almost $605 million by the end of March, a 10% increase on its target. Second quarter profit rose $555 million.

Ryanair has cut out less-profitable routes in favor of others and added central airports to its routes to target business travel, raising average fares almost 15% in the first half of 2011. Fuel costs continue to eat into the airline’s profits as first-half kerosene expenses climb more than 35%.

Ryanair’s quarterly net revenue rose over 20%, and the company raised its full-year outlook for 2011, as the airline saw a more than 5% rise in Dublin, with trading climbing almost 4%. The company, which is negotiating to expand its services to 30 more airports, is topping the Bloomberg EMEA Airlines Index in 2011 despite an 8% fall to just over $7 billion.

Other companies on the index have seen more serious falls, with Air France-KLM Group plummeting over 60% and Lufthansa falling almost 40%. Ryanair’s first-half net profits after tax reached over $757 million in the six months ending September, almost a $92 million rise on 2010.

Passenger Numbers Climb 4% in October

Ryanair saw its passenger numbers climb in the month of October, enjoying a 4% boost in traffic to over 7.25 million passengers. Over 77 million passengers have flown with Ryanair so far in 2011, with load factor (stress to the aircraft in terms of lift to weight ratio) down 1% from 85%.

The airline’s passenger numbers will fall from November as the winter seasons sees 80 aircraft grounded. In the six-month year period to September, passenger numbers climbed 12% to over 44.5 million, boosting profits almost 25% to $2.7 billion.

Key Statistics – Scheduled Passengers Carried (source: IATA)

  • Ryanair: ranks 1st with over 71,225 passengers
  • Lufthansa: ranks 2nd with 44,460 passengers
  • EasyJet: ranks 3rd with 37,665 passengers
  • Air France: ranks 4th with 30,882 passengers
  • Emirates: ranks 5th with 30, 848 passengers

By Ellsy O'Neill for
Ellsy O'Neill is a Paris-based writer, proofreader and translator. She covers industry, culture and current affairs.

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