A fourth wave of COVID-19 across Europe is going to make for tough times for the region’s airlines, Ryanair Group chief executive Michael O’Leary predicted.
“Up until last weekend, things were going great,” the outspoken chief executive said in an interview broadcast by Eurocontrol on November 23, 2021.
Ryanair has recovered more strongly than any other carrier in Europe. Eurocontrol data shows that Ryanair operated 2,102 flights in the week of November 16-22, 2021, up 7% on 2019 levels. Among low-cost rivals, easyJet operated 43% fewer flights while Wizz Air’s flights were 20% lower than the same period in 2019.
While the October school holiday period was good for Europe’s airlines, things are again looking under pressure, O’Leary said.
“Austria is locking down, Holland is locking down, the Germans are getting nervous,” O’Leary said. “I think we’re in for a fraught period between now and Christmas where it looks like Europe is going to get very nervous again, at the worst time of the year when people are making their Christmas travel plans.”
O’Leary also said the fourth wave could undermine confidence in the New Year, which is typically when customers book summer holidays.
He therefore urged European governments to keep a cool head and maintain freedom of movement within the bloc.
“There’s no doubt in my mind the Austrians have panicked. If you need restrictions, they should be imposed on unvaccinated people,” he stated.
Eurocontrol director general Eamonn Brennan also noted in a market update that transatlantic travel had not bounced back as quickly as expected. While European traffic overall is still in line with its most optimistic scenario, Brennan sounded a note of caution.
“I’m worried now with restrictions and all of these kinds of things that we might actually start trending a little bit lower,” he said.
Brennan added: “The reality is that restricting air travel does not stop COVID. it makes no sense whatsoever.”
Cheap tickets
Even though Ryanair’s flight numbers are back up to pre-COVID levels, its ticket prices are not. O’Leary said pricing was currently about 30% down on pre-pandemic levels. While the airline didn’t sack any staff during the pandemic, they have all taken pay cuts and O’Leary said pricing would need to be restored to pre-pandemic levels before pay could be returned to usual levels.
“It’s fine to be carrying about 80 or 90% of our pre-COVID traffic as we did in October. But at 30% lower airfares that’s not sustainable,” O’Leary said.
Turning to climate change, O’Leary acknowledged that Ryanair has a duty to reduce emissions but said emissions taxes in Europe, from which non-EU carriers and long-haul carriers are exempt, was unfair.
“New technology, I think, is the most critical role. Sustainable aviation fuels (SAF) undoubtedly can play a significant role. But the challenge with SAFS is we need it in large volumes at Europe’s airports. And that’s not going to happen without European governmental support.”
Governments need to take the money they are charging airlines in taxes and invest it into research and development, or by boosting production of sustainable aviation fuels (SAF), O’Leary said.
“We would call on European governments to use that money to research, develop and produce sustainable aviation fuels in large quantities and make it available at airports so that actually it does become a realistic choice. It’s not available at the moment.”