Ryanair

Ryanair Company AirWaves
Ryanair.svg
IATA ICAO Callsign
FR RYR RYANAIR
Founded 28 November 2001 [1]
Commenced operations 8 July 1985
Operating bases
Fleet size 420
Destinations 205
Company slogan
  • Low Fares Made Simple
  • 30 Years of Low Fares
  • Always Getting Better
Headquarters Dublin Airport, Ireland
Key people
Michael O'Leary (CEO)
Revenue Increase €6.536 billion (2016)
Operating income Increase €1.663 billion (2016)
Net income Increase €1.559 billion (2016)
Total assets Increase €12.218 billion (2016)
Total equity Increase €4.035 billion (2015)
Employees 11,458 (2016) [2]
Website www.ryanair.com
Counter of Ryanair in Glasgow

Ryanair Ltd. (/raɪə'ner/) [3] is an Irish low-cost airline founded in 1984, headquartered in Swords, Dublin, Ireland, with its primary operational bases at Dublin and London Stansted airports. In 2016, Ryanair was the largest European airline by scheduled passengers flown, and carried more international passengers than any other airline. [4] ( RY4C, RYA, RYAAY)

Ryanair operates 403 Boeing 737-800 aircraft, with a single 737-700 used primarily as a charter aircraft, but also as a backup plane and for pilot training. [5] The airline has been characterised by its rapid expansion, a result of the deregulation of the aviation industry in Europe in 1997 and the success of its low-cost business model. Ryanair's route network serves 34 countries in Europe, Africa (Morocco), and the Middle East (Israel). [6]

History

ATR-42 in 1991

Since its establishment in 1984, [1] Ryanair has grown from a small airline flying the short journey from Waterford to London into Europe's largest carrier. Ryanair now has over 11,000 people working for the company, most of whom are employed and contracted by multiple agencies to fly on Ryanair aircraft, or, as is the case for pilots, the vast majority are either agency employed or self-employed and their services are contracted to Ryanair. After the rapidly growing airline went public in 1997, the money raised was used to expand the airline into a pan-European carrier. Revenues have risen from €231 million in 1998, to €1,843 million in 2003 and €3,013 million in 2010. Similarly net profits have increased from €48 million to €339 million over the same period. [7]

Early years

Ryanair was founded in 1984 as "Danren Enterprises" [1] by Christopher Ryan, Liam Lonergan (owner of Irish travel agent Club Travel) and Irish businessman Tony Ryan (after whom the company is named), founder of Guinness Peat Aviation. [8] The airline was shortly thereafter renamed "Ryanair" [1] and began operations in 1985 with a 15-seat Embraer Bandeirante turboprop aircraft, flying between Waterford and Gatwick Airport [9] with the aim of breaking the duopoly on London-Ireland flights at that time, held by British Airways and Aer Lingus. [10]

In 1986, the company added a second route – flying DublinLuton in direct competition with the Aer Lingus / British Airways duopoly for the first time. Under partial EU deregulation, airlines could begin new international intra-EU services, as long as at least one of the two governments gave approval (the so-called "double-disapproval" regime). The Irish government at the time refused its approval, to protect Aer Lingus, but Britain, under Margaret Thatcher's deregulating Conservative government, approved the service. With two routes and two planes, the fledgling airline carried 82,000 passengers in one year.[ citation needed]

In 1986 the directors of Ryanair took an 85% stake in London European Airways, from 1987 this provided a connection with the Luton Ryanair service onward to Amsterdam and Brussels. [11] In 1987, Ryan hired Michael O'Leary as his personal financial and tax advisor. In 1988 London European operated as Ryanair Europe and later began to operate charter services. [12] [13] Ryanair passenger numbers continued to increase, but the airline generally ran at a loss and, by 1991, was in need of restructuring including the closure of Ryanair Europe/London European. O´Leary was charged with the task of making the airline profitable. O'Leary quickly decided that the key to profitability was low fares, quick turn-around times for aircraft, " no frills" and no business class, as well as operating a single model of aircraft. [14] In 1989, a Short Sandringham was operated with Ryanair sponsorship titles but never flew revenue-generating services for the airline. [15]

O'Leary returned from a visit to Southwest Airlines convinced that Ryanair could make huge inroads into the European air market, at that time dominated by national carriers, which were subsidised to various degrees by their parent countries. He competed with the major airlines by providing a "no-frills", low-cost service. Flights were scheduled into regional airports, which offered lower landing and handling charges than larger established international airports. O'Leary as Chief Executive took part in a publicity stunt, where he helped out with baggage handling on Ryanair flights at Dublin Airport. By 1995, after the consistent pursuit of its low-cost business model, Ryanair celebrated its 10th birthday by carrying 2.25 million passengers. [16]

1992–2009

Ryanair operated BAC 1-11 series 500 aircraft between 1988 and 1993

In 1992, the European Union's deregulation of the air industry in Europe gave carriers from one EU country the right to operate scheduled services between other EU states and represented a major opportunity for Ryanair. [17] After a successful flotation on the Dublin Stock Exchange and the NASDAQ Stock exchanges, the airline launched services to Stockholm, Sandefjord Airport, Torp (110 km south of Oslo), Beauvais–Tillé and Charleroi near Brussels. [18] In 1998, flush with new capital, the airline placed a massive US$2 billion order for 45 new Boeing 737-800 series aircraft. [19]

Boeing 737-200 landing at Bristol Airport, the type operated by the company through the 1990s and until 2005
Boeing 737-800 in the old livery

The airline launched its website in 2000, with online booking initially said to be a small and unimportant part of the software supporting the site. Increasingly the online booking contributed to the aim of cutting flight prices by selling directly to passengers and excluding the costs imposed by travel agents. Within a year, the website was handling three-quarters of all bookings.

Ryanair launched a new base of operation in Charleroi Airport in 2001. Later that year, the airline ordered 155 new 737-800 aircraft from Boeing at what was believed to be a substantial discount, to be delivered over eight years from 2002 to 2010. [20] Approximately 100 of these aircraft had been delivered by the end of 2005, although there were slight delays in late 2005 caused by production disruptions arising from a Boeing machinists' strike. [21]

Ryanair cabin with advertising on overhead lockers and safety cards on seatbacks

In April 2003, Ryanair acquired its ailing competitor Buzz from KLM. [22]

During 2004, Michael O'Leary warned of a "bloodbath" during the winter from which only two or three low-cost airlines would emerge, the expectation being that these would be Ryanair and EasyJet. [23] A loss of €3.3 million in the second quarter of 2004 was the airline's first recorded loss for 15 years but the airline became profitable soon after. The enlargement of the European Union on 1 May 2004 opened the way to more new routes for Ryanair. [24]

The rapid addition of new routes and new bases has enabled growth in passenger numbers and made Ryanair among the largest carriers on European routes. In August 2005, the airline claimed to have carried 20% more passengers within Europe than British Airways. [25]

For the six months ending 30 September 2006 passenger traffic grew by more than a fifth to 22.1 million passengers and revenues rose by a third to €1.256 billion. [26]

On 13 February 2006, Britain's Channel 4 broadcast a documentary as part of its Dispatches series, "Ryanair caught napping". The documentary criticised Ryanair's training policies, security procedures and aircraft hygiene, and highlighted poor staff morale. Ryanair denied the allegations [27] and claimed that promotional materials, in particular a photograph of a stewardess sleeping, had been faked by Dispatches. [28]

On 5 October 2006, Ryanair launched a €1.48 billion (£1 billion; $1.9 billion) bid to buy fellow Irish carrier Aer Lingus. Ryanair CEO Michael O'Leary said the move was a "unique opportunity" to form an Irish airline. The new airline would carry over 50 million passengers a year. [29] On 2 October 2006, Aer Lingus rejected Ryanair's takeover bid, saying it was contradictory. [30]

In August 2006, the company started charging passengers to check in at the airport, therefore reversing its policy of paying for online check-in. It says that by cutting airport check-in, it reduces overhead costs. [31]

Ryanair's CEO, Michael O'Leary, stated in April 2007 that Ryanair planned to launch a new long-haul airline around 2009. [32] The new airline would be separate from Ryanair and operate under a different branding. It would offer both low cost with fares starting at €10.00 and a business class service which would be much more expensive, intended to rival airlines like Virgin Atlantic. The new airline would operate from Ryanair's existing bases in Europe, to approximately six new bases in the United States. The new American bases will not be main bases such as New York's JFK airport, but smaller airports located outside major cities. Since the Boeing 787 was sold out of production until at least 2012, and the Airbus A350 XWB will not enter service until 2014, this has contributed a delay to the airline's launch. It is said that the name of the new airline will be RyanAtlantic and it will sell tickets through the Ryanair website under an alliance agreement. [33] In February 2010, O'Leary said the launch would be delayed until 2014, at the earliest, because of the shortage of suitable, cheap aircraft. [34] [35]

In October 2008, Ryanair withdrew operations from a base in Europe for the first time when it closed its base in Valencia, Spain. [36] Ryanair estimated the closure cost 750 jobs. [37]

On 1 December 2008, Ryanair launched a second takeover bid of Aer Lingus, offering an all-cash offer of €748 million ( £619 mil; US$950 million). The offer was a 28% premium on the value of Aer Lingus stock, during the preceding 30 days. Ryanair said, "Aer Lingus, as a small, stand alone, regional airline, has been marginalised and bypassed, as most other EU flag carriers consolidate." The two airlines would operate separately. Ryanair stated they would double the Aer Lingus short-haul fleet from 33 to 66 and create 1,000 new jobs. [38] [39] [40] The Aer Lingus board rejected the offer and advised its shareholders to take no action. [41] On 22 January 2009, Ryanair walked away from the Aer Lingus takeover bid after it was rejected by the Irish government on the grounds it undervalued the airline and would harm competition. [42] However, Ryanair retained a stake in Aer Lingus; in October 2010, competition regulators in the UK opened an enquiry, due to concerns that Ryanair's stake may lead to a reduction in competition. [43]

In 2009, Ryanair announced that it was in talks with Boeing and Airbus about an order that could include up to 200 aircraft. Even though Ryanair had dealt with Boeing aircraft up to that point, Michael O'Leary said he would buy Airbus aircraft if they offered a better deal. However, Airbus Chief Commercial Officer John Leahy denied in February 2009 that any negotiations were taking place. [44]

On 21 February 2009, Ryanair confirmed they were planning to close all check-in desks by the start of 2010. Michael O'Leary, Ryanair's chief executive, said passengers will be able to leave their luggage at a bag drop, but everything else will be done on line. This became reality in October 2009. [45]

In June 2009, Ryanair reported their first annual loss, with a loss posted of €169 million for the financial year ending 31 March. [46]

In November 2009, Ryanair announced that negotiations with Boeing had proceeded poorly and that Ryanair was thinking of stopping the negotiations, then put at 200 aircraft for delivery between 2013 and 2016, and simply returning cash to shareholders. [47] Boeing's competitor Airbus was mentioned again as an alternative vendor for Ryanair, but both Michael O'Leary and Airbus CCO John Leahy dismissed this. [48] In December 2009, Ryanair confirmed that negotiations with Boeing had indeed failed. Plans were to take all 112 aircraft already on order at that point, with the last deliveries occurring in 2012, for a total fleet of over 300. Ryanair confirmed that an agreement had been met on price, but it had failed to agree on conditions, as Ryanair had wanted to carry forward certain conditions from its previous contract. [49]

2010s

Ryanair aircraft landing, 2016

As of February 2010, Ryanair had an average fare of €32. Ryanair stood by the fact that its average fare was less than half than that of competitor EasyJet's of €66.

In April 2010, after a week of flight disruption in Europe caused by the 2010 eruptions of Eyjafjallajökull in Iceland, Ryanair decided to end refusals to comply with EU regulations which stated they were obliged to reimburse stranded passengers. [50] In a company statement released on 22 April 2010, Ryanair described the regulations as 'unfair'. On 29 April 2010, Ryanair cancelled of all of its routes from Budapest Liszt Ferenc Airport after talks about decreasing taxes with the airport's management failed. The airport is the only one serving Budapest, so the airline is not able to operate from an alternative lower-cost airport in the surroundings.

In June 2010, Ryanair called for a scrapping of the Irish government's tourist tax, implying it was destroying Irish tourism. [51]

In August 2010, Ryanair held a press conference in Plovdiv and announced its first ever Bulgarian destination connecting Plovdiv with London Stansted. The service was planned to start in November 2010 with two flights weekly. [52]

In late 2010, Ryanair began withdrawing all their routes from their smallest base, Belfast City, and Shannon due to rises in airport fees. [53]

In the last three months of 2010, Ryanair made a loss of €10.3 million, compared with a loss of €10.9 million in the same period the previous year. In this time, more than 3,000 flights were cancelled. Ryanair blamed the losses on strikes and flight cancellations due to severe weather. [54]

In March 2011, Ryanair opened a new maintenance hangar at Glasgow Prestwick International Airport, making it Ryanair's biggest fleet maintenance base.

In June 2011, Ryanair and COMAC signed an agreement to co-operate on the development of the C-919, a Boeing 737 competitor. [55]

Ryanair cut capacity by grounding 80 aircraft between November 2011 and April 2012 due to the high cost of fuel and continuing weak economic conditions. [56]

On 19 June 2012, Ryanair Chief Executive Michael O'Leary announced his intentions to make an all-cash offer to buy Aer Lingus. However, the bid is likely to face a stiff challenge from the European Commission, which blocked an earlier 2007 bid. The combined companies would control 80% of the 370,000 journeys between the UK and Ireland every month. The Irish government said it was looking to sell its 25% stake in Aer Lingus; however, it was made clear that they would not sell their share to Ryanair due to competition concerns. Michael O'Leary pledged that he would keep the two airlines separate and competitive to one another. In 2015, IAG purchased Ryanair's shareholding in Aer Lingus, ending Ryanair's attempts to buy its oldest competitor.

On 25 October 2013, Ryanair unveiled what it called a series of "customer service improvements" over the next six months. These included lower fees for reprinting boarding passes, free changes of minor errors on bookings within 24 hours, and a second small carry on bag. Ryanair said it was making these changes due to customer feedback. [57]

On 27 January 2014, Ryanair moved into their new €20m, 100,000 sq ft Dublin Head Office in Airside Business Park, having outgrown their previous office based within Dublin Airport. [58] The building was officially opened on Thursday 3 April 2014 by Taoiseach Enda Kenny, Minister for Finance Michael Noonan and the Lord Mayor of Dublin Oisin Quinn.

On 8 September 2014, Ryanair agreed to purchase up to 200 Boeing 737 MAX 8s (100 confirmed and 100 options) for over $22 billion. [59]

The airline confirmed plans to open an operating base at Milan Malpensa Airport from December 2015, initially with one aircraft. [60]

On 9 March 2016, Ryanair launched a corporate jet charter service, offering a Boeing 737-700 for corporate or group hire. [61] [62]

In November 2016, Ryanair launched new package holiday service named Ryanair Holidays. The new service will offer flights, accommodation and transfer package deals. The service has been launched in Ireland, United Kingdom and Germany, with other markets to follow next year. [63] Ryanair has partnered with Spain-based tour operator, Logitravel, and accommodation provider, World2Meet, to create Ryanair Holidays. [64] In early February 2017, Ryanair suspended their Ryanair Holidays service, stating that one of their software providers breached contract conditions. It is thought Ryanair are currently looking for a new software provider to resume selling package holidays. [65]

In April 2017, Ryanair started issuing tickets with connected flights, meaning in case of missed connection the customer will be rebooked without extra cost and compensated according to the EU Flight Compensation Regulation. To begin with, such tickets were issued only with connection at Rome-Fiumicino airport, but will be extended to more airports. [66] [67]

Plans are underway to add 50 new aircraft to Ryanair's fleet every year for the next five years in a strategy to reach 160 million passengers by the early 2020s, up from 120 million passengers today. [68]

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