Ryanair to pull out of Stansted?

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AWA Posted: Wed, Jun 20 2007 4:34 PM

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Ryanair has threatened a partial pull-out from its largest airport
base in a row over fees. The low-cost carrier said it will withdraw
planes from Stansted unless BAA, owner of the Essex airport, cuts its
charges. Ryanair issued the ultimatum as it warned that higher
airport costs, plus increased taxes, were continuing to affect demand
among British customers.
"We will take some flights and aircraft out of Stansted this winter
if there is no movement on these high costs," said Ryanair's chief
executive, Michael O'Leary.

Ryanair is blaming BAA and the government for a recent drop in its
passenger load factor - a measure of how full its planes are. The
carrier says a doubling of air passenger duty to £10 and a doubling
of fees at Stansted to £12 a passenger has filtered through to ticket
prices and affected demand. Mr O'Leary added: "Passengers are
suffering a double whammy."

BAA could not be reached for comment. Mr O'Leary said Ryanair would
start by withdrawing 10% of its fleet from Stansted, equivalent to
four planes.

The Ryanair chief also warned that the airline market was due for a
severe downturn. He said there would be "blood on the walls" in the
sector over the winter if the current weak sales across Europe
continued into the autumn, without summer holiday sales to shore up
demand. "The market will downturn. We expect it to be in the next 12
months. We just don't know what is going to cause it," he said. "All
we know is that this business is cyclical and the down points of the
cycle tend to be very deep." Ryanair underlined its concerns
yesterday by launching another seat sale during its busiest time of
year, selling 3m flights for £10 including charges and taxes, less
than a month after it gave away 1m tickets for 1p including add-ons.
The offer will cost Ryanair between £20m and £45m. "Our concern is
not so much the summer, where we already have decent visibility. We
are much more concerned about the coming winter. If those soft
markets continue it could be a very difficult winter in general,"
said Mr O'Leary.

Ryanair reported a 33% rise in pre-tax profits to €451m (£305m)
earlier this month, but predicted growth in the current financial
year would be just 5% and said it could lose money over the winter.
Its load factor fell from 82% to 80% last month, with easyJet and BA
also reporting difficulties in filling their planes.

Source:The Guardian