According to the controversial Mr O’Leary, Ryanair’s low fares are not sustainable given the company’s cost-cutting measures and plans to move into more central (and expensive) European airports, reported the Belfast Telegraph.
Instead, the carrier will focus on quality rather than price.
“We have to move away over the next number of years from being obsessed with having the lowest fares in the market,” Mr O’Leary told the newspaper.
“At the moment we just pile it high and sell it cheap.”
Mr O’Leary looked to the success of global discount supermarket chain Lidl, which “started off cheap and cheerful but now it is very sophisticated.”
carhiremarket.com product manager Anel Bruns claimed that Mr O’Leary’s warning of the end of low air fares “will cause alarm among today’s price sensitive consumers”, but added that savvy travellers would look at other ways to save money when travelling.
“Now is the time for consumers to consider their options in order to get the best deal,” Ms Bruns said.
“For example, alternatives like coach travel or car hire rental can not only provide a cheaper way to travel, but can also help to reduce carbon footprints when compared to air travel.”Mr O’Leary was recently in hot water after denying global warming and man-made climate change, Greenpeace spokesperson Joss Garman quoted in The Guardian as saying, “Personally, I wouldn’t trust ‘O’Really’ to tell me the price of a seat on his own airline, but to be fair his position [on climate change] does have the support of such intellectual heavyweights as Nick Griffin, Sarah Palin and George W Bush.”
Like many airlines, Ryanair is facing pressure on costs but, as it moves to add on new customers, it will also have to move operations to more expensive central airports across Europe.
Recently, it has begun running major operations out of Edinburgh and Barcelona El Prat, as it seeks out more upmarket customers. However, the increase in fares is not expected for a number of years.
Mr O’Leary also said he will stay at the helm of Ryanair until the business doubles in size from over 200 aircraft currently, although he did not give a timeframe.
“Then the growth rate slows down to 2% or 3% per year. You will need a different management then. We won’t need my dog and pony show, which is about generating publicity. Every company has to move from being the high-growth Robin Hood,” he said in an interview yesterday.
Source = e-Travel Blackboard: G.A