False alarm on long-haul low-cost, says O’Leary

Following up on my blog yesterday that Ryanair’s Michael O’Leary might announce his long-haul low-cost plans today he scotched that one this morning, putting it down to an over zealous writer bigging a story.

On BBC Radio 4′s Today programme he repeated that he needs to see a “collapse in aircraft prices” for the venture to take the next step, and that the industry is “many months away from that”.

He did say however that he sees the market being “cleaned out” over the coming months as some carriers fail. “Five or six airlines will go bankrupt in Europe before Christmas,” said the Ryanair boss, and that “Ryanair would be one of the big four airlines in Europe”.

That in itself is interesting as previous conventional wisdom has put Air France-KLM, BA and Lufthansa as the network big boy survivors and Ryanair and easyJet as the big low-cost ones. Now O’Leary sees only 4 – so who’s gone?

Here’s a link to its second half results. O’Leary is guiding to a full year breakeven for the carrier, but says that profits will rebound strongly next year if oil stays at $70 a barrel.

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