Ryanair
Ryanair is an Irish ultra low-cost airline multinational group headquartered in Swords, County Dublin, Ireland. The parent company, Ryanair Holdings plc, includes subsidiaries Ryanair, Malta Air, Buzz, Lauda Europe and Ryanair UK. As of 2024, Ryanair is the largest airline in Europe, based on annual passengers, fleet size, and number of flights. Ryanair DAC, the oldest airline of the group, was founded in 1984. Ryanair Holdings was established in 1996 as a holding company for Ryanair with the two companies having the same board of directors and executive officers. In 2019, the transition began from the airline Ryanair and its subsidiaries into separate sister airlines under the holding company. Later in 2019, Malta Air joined Ryanair Holdings.
Ryanair has been characterised by its rapid expansion, a result of the deregulation of the aviation industry in Europe in 1997 and the success of its low-cost business model. The group operates more than 600 planes. Its route network serves over 40 countries in Europe, North Africa and the Middle East. The primary operational bases are at Dublin, London Stansted and Milan Bergamo airports. Ryanair is Ireland's biggest airline, and in 2016, became the world's largest airline by scheduled international passengers. Almost all aircraft in the group's fleet are Boeing 737s.
The company has at times been criticised for its refusal to issue invoices for the VAT-exempt services it provides, poor working conditions, heavy use of extra charges, poor customer service, and tendency to intentionally generate controversy in order to gain publicity.
History
Since its establishment in 1984, Ryanair has grown from a small airline, flying the short journey from Waterford to London Gatwick, into Europe's largest carrier. There have been over 19,000 people working for the company, most employed and contracted by agencies to fly on Ryanair aircraft.The airline went public in 1997, and the money raised was used to expand the airline into a pan-European carrier. Revenues have risen from €640 million in 2003 to €4.66 billion in 2010. Similarly, net profits have increased from €48 million to €339 million over the same period.
Early years
Ryanair was founded in 1984 as Danren Enterprises by Christopher Ryan, Liam Lonergan, and Irish businessman Tony Ryan, founder of Guinness Peat Aviation. The airline was shortly renamed Ryanair on 8 July 1985. It began operations in 1985 flying a 15-seat Embraer Bandeirante turboprop aircraft between Waterford and Gatwick Airport.The first chief executive was Eugene O'Neill, who had formerly worked as managing director of Ryan's Sunday Tribune newspaper and as Ryan's personal assistant. O'Neill was talented at marketing but did not focus on costs, and the airline lost money in its early years. Ryan vetoed O'Neill's proposal to take Aer Lingus to the European Commission for breach of competition rules, because at the time Aer Lingus was state-owned and Ryanair depended on the Irish government for its route licences. Ryan sacked O'Neill in September 1987, who sued for wrongful dismissal.
In 1986, the company added a second route from Dublin to Luton with two Hawker Siddeley HS 748s, thus directly competing with the Aer Lingus/British Airways duopoly for the first time. Under partial European Economic Community deregulation, airlines could begin new international intra-EEC services as long as one of the two governments approved. The Irish government at the time refused its approval to protect Aer Lingus, but Britain, under Margaret Thatcher's deregulating Conservative government, approved the service. With two routes and two aircraft, the fledgling airline carried 82,000 passengers in one year.
In 1986, the directors of Ryanair took an 85% stake in London European Airways. From 1987, this provided a connection with the Luton Ryanair service onward to Amsterdam and Brussels. In 1988, London European operated as Ryanair Europe and later began to operate charter services. That same year, Michael O'Leary joined the company as chief financial officer. In 1989, a Short Sandringham was operated with Ryanair sponsorship titles but never flew revenue-generating services for the airline.
Due to decreasing profits, the company restructured in 1990, copying the low-fares model of Southwest Airlines, after O'Leary visited the company. In a 1994 lecture, O'Leary described the strategy as adopting a simple all Boeing 737 fleet, pursuing expansion over yield, creating a culture of cost-cutting, and "re-educating" the customer to prefer lower prices to "frills". The objective of a 30-minute turnaround enabled aircraft to make more flights per day. According to O'Leary, lower fares attracted new customers to air travel, rather than Ryanair competing directly with other airlines for passengers.
1992–2009
In 1992, the European Union's deregulation of the air industry in Europe gave carriers from one EU country the right to operate scheduled services between other EU states and represented a major opportunity for Ryanair. After a successful flotation on the Dublin and the NASDAQ stock exchanges, the airline launched services to Stockholm, Sandefjord Airport, Torp south of Oslo), Beauvais–Tillé northwest of Paris, and Charleroi near Brussels. In 1998, flush with new capital, the airline placed a massive US$2 bn order for 45 new Boeing 737-800 aircraft.In 1994, Michael O'Leary became the sixth chief executive officer. Ryan clashed with O'Leary, with Ryan wanting the airline's PR stunts to be less aggressive, and O'Leary suggesting that Ryan should leave the board.
The airline launched its website in 2000, with online booking initially said to be a small and unimportant part of the software supporting the site. Increasingly online booking contributed to the aim of cutting flight prices by selling directly to passengers and excluding the costs imposed by travel agents. Within a year, the website was handling three-quarters of all bookings. By December 2023, the website hit 40M monthly visits.
Ryanair launched a new base of operation in Charleroi Airport in 2001. Later that year, the airline ordered 155 new 737-800 aircraft from Boeing at what was believed to be a substantial discount, to be delivered over eight years from 2002 to 2010. Approximately 100 of these aircraft had been delivered by the end of 2005, although there were slight delays in late 2005 caused by production disruptions arising from a Boeing machinists' strike.
In April 2003, Ryanair acquired its ailing competitor Buzz from KLM.
During 2004, Michael O'Leary warned of a "bloodbath" during the winter from which only two or three low-cost airlines would emerge. A loss of €3.3 million in the second quarter of 2004 was the airline's first recorded loss for 15 years but the airline soon became profitable again. The enlargement of the European Union on 1 May 2004 opened the way to more new routes for Ryanair.
The rapid addition of new routes and new bases has enabled growth in passenger numbers and made Ryanair among the largest carriers on European routes. In August 2005, the airline claimed to have carried 20% more passengers within Europe than British Airways.
For the six months ending on 30 September 2006, passenger traffic grew by more than a fifth to 22.1 million passengers and revenues rose by a third to €1.256 billion.
On 13 February 2006, Britain's Channel 4 broadcast a documentary as part of its Dispatches series, "Ryanair caught napping". The documentary criticised Ryanair's training policies, security procedures and aircraft hygiene, and highlighted poor staff morale. Ryanair denied the allegations and claimed that promotional materials, in particular a photograph of a stewardess sleeping, had been faked by Dispatches.
On 5 October 2006, Ryanair launched a €1.48 billion bid to buy fellow Irish flag carrier Aer Lingus. Ryanair CEO Michael O'Leary said the move was a "unique opportunity" to form an Irish airline. The new airline would carry over 50 million passengers a year. On 5 October 2006, Aer Lingus rejected Ryanair's takeover bid, saying it undervalued the airline.
Ryanair's CEO, Michael O'Leary, stated in April 2007 that Ryanair planned to launch a new long-haul airline around 2009. The new airline would be separate from Ryanair and operate under a different brand. It would offer both low costs with fares starting at €10.00 and a business class service which would be much more expensive, intended to rival airlines such as Virgin Atlantic. The new airline would operate from Ryanair's existing bases in Europe to approximately six new bases in the United States. The new American bases will not be main bases such as New York's JFK airport, but smaller airports located outside major cities to save operating costs and increase efficiency. Since the Boeing 787 was sold out of production until at least 2012, and the Airbus A350 XWB will not enter service until 2014, this contributed to a delay in the airline's launch. It was said that the name of the new airline would be RyanAtlantic and it would sell tickets through the Ryanair website under an alliance agreement. In February 2010, O'Leary said the launch would be delayed until 2014, at the earliest, because of the shortage of suitable and cheap aircraft.
In August 2007, the company started charging passengers to check in at the airport, therefore reversing its policy of paying for online check-in. Ryanair said that cutting airport check-in reduces overhead costs.
In October 2008, Ryanair withdrew operations from a base in Europe for the first time when it closed its base in Valencia, Spain. Ryanair estimated the closure cost 750 jobs.
On 1 December 2008, Ryanair launched a second takeover bid of Aer Lingus, offering an all-cash offer of €748 million. The offer was a 28% premium on the value of Aer Lingus stock, during the preceding 30 days. Ryanair said, "Aer Lingus, as a small, stand-alone, regional airline, has been marginalised and bypassed, as most other EU flag carriers consolidate." The two airlines would operate separately. Ryanair stated it would double the Aer Lingus short-haul fleet from 33 to 66 and create 1,000 new jobs. The Aer Lingus board rejected the offer and advised its shareholders to take no action. On 22 January 2009, Ryanair walked away from the Aer Lingus takeover bid after it was rejected by the Irish government on the grounds it undervalued the airline and would harm competition. However, Ryanair retained a stake in Aer Lingus; in October 2010, competition regulators in the UK opened an inquiry, due to concerns that Ryanair's stake may lead to a reduction in competition.
In 2009, Ryanair announced that it was in talks with Boeing and Airbus about an order that could include up to 200 aircraft. Even though Ryanair had dealt with Boeing aircraft up to that point, Michael O'Leary said he would buy Airbus aircraft if it offered a better deal. Airbus Chief Commercial Officer John Leahy denied in February 2009 that any negotiations were taking place.
On 21 February 2009, Ryanair confirmed it was planning to close all check-in desks by the start of 2010. Michael O'Leary, Ryanair's chief executive, said passengers would be able to leave their luggage at a bag drop, but everything else would be done online. This became reality in October 2009.
In June 2009, Ryanair reported its first annual loss, with a loss posted of €169 million for the financial year ending 31 March.
In November 2009, Ryanair announced that negotiations with Boeing had proceeded poorly and that Ryanair was thinking of stopping the negotiations, then putting at 200 aircraft for delivery between 2013 and 2016, and simply returning cash to shareholders. Boeing's competitor Airbus was mentioned again as an alternative vendor for Ryanair, but both Michael O'Leary and Airbus CCO John Leahy dismissed this. In December 2009, Ryanair confirmed that negotiations with Boeing had indeed failed. The plans were to take all 112 aircraft already on order at that point, with the last deliveries occurring in 2012, for a total fleet of over 300. Ryanair confirmed that an agreement had been met on price, but it had failed to agree on conditions, as Ryanair had wanted to carry forward certain conditions from its previous contract.