Saturday, 23 June 2012

We need Irish airline competition ©


It is in the consumer interest the government maintains it's two airline competition policy following the third Ryanair's take-over bid for Aer Lingus, although Ryanair have stated the landscape  has changed dramatically fundamentally since it's last bid the competitition case against approving the bid is even more stronger than before.

A staggering thirty four scheduled carriers have exited the Irish market through bankruptcy , consolidation & route network adjustment to re-focus on assets on routes where they earn a higher rate of return . The extensive list of  scheduled carriers include:  Air Southwest, Air Wales,  Alitalia,  Bmibaby, Blue 1,  BMI Regional , Basiq Air, Centralwings, Cimber Sterling, Clickair,  CSA Czech Airlines, Cityflier, Easyjet, Estonia Air, Euromanx, FlyLAL, Flyglobepsan, Futura International,  GoFly, Hapag Lioyd Express (,  Jetbird, Luxair, LOT Polish Airlines,Manx2, Malev Airlines, Maersk Air, Monarch Airlines, Regional Airlines, SkyEurope, Spanair, Skyways, Smartwings, Sun Air, Thomsonfly, Tarom Airlines. 

Going Forward the case will be compounded as EU Legacy carriers (Air France-KLM, Lufthansa, SAS Airlines) are loss-making in the European short-haul market & re-structuring to restore profitability in this segment which is vital to feed their hubs, as demonstrated by Iberia Airlines establishing a lower-cost production unit Iberia Express to feed it's Madrid Hub.

Aer Lingus and Ryanair compete directly on  22 city pairs from Dublin notably as opportunities arise for Ryanair to enter primary airports through the bankruptcy of carriers they are competing head to head as the case of Budapest (Malev Airlines) and Barcelona El Prat (Spanair) and indirectly on a further 14 city pairs (Source

Interestingly the Ryanair CEO Michael O'Leary stated in an interview with Bloomberg last September the carrier would fly increasingly to primary airports over the next five years this transformation is underway as seen by the establishment of bases in Budapest, Barcelona and Manchester. I was at Shannon Chamber of Commerce lunch a few years ago where the Ryanair CEO Michael O'Leary stated he would use Aer Lingus to establish a base at Manchester to compete against Easyjet , however Ryanair themselves have now established a base in Manchester.

The likelihood of a viable strong competitor entering the Irish market is very remote as a consolidated Aer Lingus/Ryanair carrier would have dominance of the market as figures revel in Dublin Airport Authority (DAA) 2011 Annual report  Cork Airport (84%), Dublin Airport (78%) and Shannon Airport (64%). 

This week saw Easyjet announce it will close it's Madrid Base this winter due to poor returns in a very weak market, it too withdrew from the Irish market in 2006 after a bitter fare war with Ryanair on routes from London Gatwick to Cork, Ireland West Knock Airport and Shannon Airport. GoFly withdrew from the Irish Market after sustaining heavy losses in a fare war with Ryanair on Dublin to Edinburgh and Glasgow in 2002 after six months.

External market factors (Demand, Fuel,Geo-political) will create an ever changing market place, recently a number of high profile CEO's warned of a very tough winter 2012/3 ahead warning some large carriers could disappear, coped with the on-going EU debt crisis freezing out start-up carriers from entering the market whom won't have the economies of scale to compete from a small base.

Interestingly the debate has so far ignored the fact that control of Aer Lingus will yield Strategic Aviation assets namely Hangar 6 and the anchor tenant Terminal 2 at Dublin Airport.

Irish Aviation Research Institute © 23rd June 2012

Thursday, 14 June 2012

European Airlines Report May Traffic ©


Air Berlin announced it carried 3.089 million passengers down 6.4% with a load factor of 76.4% up 0.6% on a 7.2% reduction in capacity as the carrier continues the roll out of ‘Shape & Size’ efficiency programme. The airline has carried 12.260 million passengers year to date down 5.3%.

Air France-KLM announced that it carried 6.55 million passengers down 0.8% with a load factor of 80.8% up 1% on a 1.4% reduction in capacity.

Finnair announced it carried 737,000 passengers up 7.2% with a load factor of 74.4% up 4.9%

IAG announced it carried 4.81 million passengers up 9.3% with a load factor of 78.6% up 0.5%.

Lufthansa Group announced it carried 9.23 million passengers up 0.9% with a load factor of 77.9% down 0.1%.  


Norwegian Air Shuttle announced it carried 1.375 million passengers up 16% with a load factor of 765% down 1% its average sector length increased by 4% with unit revenues up 3%.

SAS Airlines announced it carried 2.7 million passengers up 4.2% with a load factor of 75.3% up 1.9% revenue per unit fell by 3.4%.

Vueling Airlines announced it carried 1.3 million passengers up 14.8% with a load factor of 74.3% up 1.5%.

                                                     Irish Aviation Research Institute © 14th June 2012

Wednesday, 13 June 2012

Irish Airlines Report May Traffic ©

The Aer Lingus Group (Including Aer Lingus Regional) announced that it carried 970,000 passengers in May up 2.4% with a load factor of 76.2% up 2.9%. In the short-haul segment it carried 793,000 passengers down 1.1% with a load factor of 73.8% up 0.9% with revenue passenger kilometres down 0.4% to 895 million on available seat kilometres down 1.6%.

In the long-haul segment it carried 89,000 passengers up 12.7% with a load factor of 81.5% up 7.4% with revenue RPK’S up 10.5% on ASK up 0.5%. The strong performance of the long-haul operation reflect the success of its business model with multiple partnerships and the ability to feed connecting over it’s Dublin base offsetting the on-going weakness in domestic demand.

Aer Lingus Regional carried 88,000 passengers up 33.3% and year to date have carried 351,000 passengers and as usual figures exclude traffic carried on the United Airlines Joint-Venture Washington Dulles to Madrid route.

Compared to the Association of European Airlines (mainly so-called legacy carriers) as a whole, the Aer Lingus passenger load factor was in line on short-haul routes (73.8% v.74.2%) and lower on the North Atlantic routes (81.5% v. 86.2%).


Ryanair announced that it carried 7.51 million passengers in May up 5% with a load factor of 81% down 1% and year to date it has carried 76.6 million passengers.

                              Irish Aviation Research Institute © 13th June 2012

Monday, 11 June 2012

Terms and Conditions of Use: Compliance Irish Copyright and Related Acts ©

To readers

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Irish Aviation Research Institute © 11th June 2012