Tuesday, November 5, 2024

Ryanair ‘worried for UK’ as it tells airports to slash fees or lose flights

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While the hike won’t hit until 2026, Ryanair said it needed to take decisions now for the long term. It is already locking in deals stretching into the 2030s.

The carrier posted a 6pc drop in profit for the peak summer quarter through June as fares declined 7pc, something it blamed on continuing pressure on consumer spending.

The tax blow coincides with disrupted deliveries of Boeing planes to Ryanair, with the carrier expecting to carry 5m people fewer than planned next year.

That will serve to further intensify competition between airports for flights, Mr Sorahan said. The CFO said airports will need to accept reduced margins on fees in order to maintain services and rely more on profits from their shops and restaurants.

He said: “They’ll have to look at how they stimulate volume for ourselves and other airlines.

“Airports don’t make money from landing and handling charges but they do make a lot of money from their shopping mall, their car park, their hotel.”

Ryanair chief executive Michael O’Leary said he expected UK passenger numbers to drop from 55m to 50m due to what he called Labour’s “insane” decision on APD.

Mr Sorahan said that as well as a reduction in flights, it was possible that smaller UK bases could be at risk of closure, though “it’s too early to call”.

He said employment at Ryanair should not be at risk as the company can “rotate people around”, though job losses in the wider economy will be inevitable where flights are cut.

He said: “That’s where the issue will be. Tourism and the B&Bs, restaurants, hotels and coffee shops, and the handling companies and others that are dependent on airport traffic.”

Mr Sorahan said rival carriers will have to make similar calculations based on the increase in APD and engine glitches that have also reduced the availability of Airbus planes.

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