‘Low fares the only game in town’

TOURISTS will not come to Shannon unless they are motivated by low fares, according to Ryanair’s chief operating officer, Michael Cawley.

Mr Cawley pointed out Shannon Airport has lost two million passengers since 2008, some of which were American soldiers, believed to be in the region of 300,000.

“There aren’t thousands of tourists who want to pay a premium to come to Shannon. Over 800 of Ryanair’s 1,500 routes have no competition and will never have competition because they are dependant on low fares. To fly to Girona at Easyjet and Aer Lingus prices, the demand would not fill the planes with higher fares,” he said.

When Ryanair had 1.9 million passengers coming through Shannon Airport in 2008, he claimed their average fare was €20 to €25 year round and less than €20 in the winter time. The number of passengers has now fallen to 375,000.

Acknowledging all these flights and passengers were not inbound, he said it was still valid business for the airport from Germany and the United Kingdom, which are the principal markets.

“The value of American traffic in Shannon is a thing of the past. We may as well face up to that fact. The same is true in Dublin. Beauvais Airport has grown every year to 3.8 million passengers without the construction of any expensive terminal.

“The biggest market where you can make a big change straight away, because it is reliable and price dependant, is Europe. Germans may be affluent but they want value for money,” he explained.

He claimed Ryanair’s average short-haul fare of €45, which increased by 16% last year, is much lower than their competitors and compared it to Easyjet (€71), Aer Lingue (€91) and Iberia (€169).

He also claimed Aer Lingus doesn’t have the capacity to be Shannon’s saviour. While the Dublin Airport Authority (DAA) blamed the recession on the dramatic decline in passenger numbers at the three State airports since 2008, he pointed out Ryanair’s overall traffic numbers grew from 50 to 75 million last year and are estimated to reach 80 million in 2012.

“The lower end of the market is the only sector that is growing. British Airways has 10 million passengers less than when I joined Ryanair 10 years ago,” he said.

Ryanair estimates that it was creating 1,000 jobs in Shannon in 2008. “Ryanair flies free into 50 or 60 of the 180 airports. Shannon can’t afford to charge much more than free if they want to be competitive in Europe.

“It is all very well if you are talking about London Heathrow. There will be a certain number, millions, who are prepared to go there for connectivity.

“Every passenger we bring through an airport spends €400 or €500. In the Canary Islands, where we have a free deal for five years, tourists spend an average of €1,200 because they stay longer, it is so far away. Malta are paying us to go there. I would hate to tell you what the Maltese Government are paying us. They are our passengers. They are travelling because the fare is €45, they are not travelling because they think Shannon is the greatest place in the world,” he said.

He said Ryanair is the biggest airline in Italy and Spain and second-biggest in Benelux and he claimed it is the only airline that can attract huge passenger numbers to Shannon.

He pointed out Knock, Kerry and Derry airports had experienced growth from Ryanair because they have been competitive and aren’t prepared to levy €15 per passenger like Shannon.

While he declined to give the terms Ryanair is receiving in Knock and Kerry, he confirmed “free is expensive” in these airports.

He estimated Shannon Airport could make at least €5 per passenger extra from rents from a duty shop, other shops, car parking and other non-nautical services if the Government accepts its deal.

“There is no extra cost for Shannon Airport in accepting this deal. The costs in Shannon haven’t dropped significantly since we withdrew most of our services. You will not make any money without passengers. The facilities at Shannon are adequate and don’t need any expenditure.

“Low fares is the only game in town for Shannon. We can open routes that no other airline will open,” he concluded.