Ryanair sees quick airline recovery marked by low fares

[turbinetree]

Source: Reuters

BUSINESS NEWS APRIL 15, 2020 / 10:53 AM / UPDATED 30 MINUTES AGO

PARIS (Reuters) - Ryanair (RYA.I) is steeling for an airline price war that it expects to win once coronavirus restrictions are lifted and passengers flock back to tourist destinations, Chief Executive Michael O’Leary told Reuters on Wednesday.

Brushing off forecasts of a sluggish recovery, O’Leary predicted a swift traffic rebound, with the pain coming instead from “massive price-dumping” that traditional airlines now seeking bailouts would struggle to keep up with.

“When this thing is over there is going to be such massive discounting going on that there will be a large spike upward in travel and tourism for a period of time,” O’Leary said.

“How long it will take pricing to recover ... we think that’s out into 2021, but who knows?”

Reporting by Laurence Frost; Editing by Mark Potter

Read more: https://www.reuters.com/article/us-health-coronavirus-ryanair-market/ryanair-sees-quick-airline-recovery-marked-by-low-fares-idUSKCN21X28R?il=0

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Hate to pop O'Leary's bubble but according to Aviation Weekly...................the business model for aviation is going to change dramatically.......and to think that you can just start packing planes again...........not happening......

[rzemanfl]

1. My wife priced fares from TPA to MKE this morning for August and September.

$177 roundtrip. The cheapest rt fare I've ever gotten was in the early '90s, $175, and it was only available for one day when TWA was celebrating getting out of bankruptcy.

[jimfields33]

2. We will have to wait and see

Those who are still working from home through telework are not spending as much money. They are basically at home 24/7. I think people are going to go on vacation at first opportunity. We have people having underground parties now due to misery in San Francisco. Can you imagine the whole country? Did you ever hear the term cabin fever. It’s going to be huge. We’re only a month into this and people are getting antsy.

[Steelrolled]

3. I think it will be a slow recovery for the airlines

But there will be a certain amount of pent-up demand. Personally, I doubt if I use any public transport (unless an emergency) until I get the vaccine or survive an infection.

[yaesu]

4. there isn't going to be a miracle, one day its poof, all gone. This virus will be haunting us for

months, probably years, where are people going to travel to? Countries, states will be paranoid about second, third, fourth.... outbreaks.

[frazzled]

5. Being on a plane itself will be deterrent to many

In normal times, being in an airplane is the quickest way to catch something (usually just a cold, but still). I don't think I'll feel comfortable flying for some time, unless it is absolutely necessary.

[PSPS]

7. Sorry, but I think flying places is largely over.

Most businesses, having now been dragged into the 21st century's tele-conferencing and working remotely, will be loath to return to paying for its employees to fly hither and yon for "meetings." Furthermore, most people will be loath to take long vacation or business trips in the "tuberculin tube" for years.

This will affect even non-flying scenarios. For example, The Economist ran a piece recently about how one large firm in the UK has begun rotating 20% of its workforce to work remotely from home for a week. The result was they were able to give up an entire floor of their building, saving over $1 million a month in rent.

[ProfessorGAC]

9. As One Who Traveled A Lot When I Was Working

I don't see the change you do. Especially international travel.
I did teleconferencing to Europe, the PacRim, South America...
But, the amount of progress is troubleshooting & streamlining by actually being there was 10-15 times greater.
Admittedly, I was generally going because things were messed up. I wasn't the "oh boy we're getting a corporate visitor" person. I was more Darth Vader showing up.
The $ to be gained by in person work is easy for execs to ID. They already know what's being wasted. It's why they'd call me to ask me to go fix things.
Just using me as an example, if product quality went up (reduced cost of recovery & blending) and throughput went up (lower overhead unit cost) in a week vs. 4 months would tell execs to say "Just go."

[IronLionZion]

12. Some companies will change their business models

especially for meetings as you described. It would be great if culture is changed to allow more remote work for people who have long commutes or have to work with partners in geographically dispersed areas. The cost savings from real estate in many expensive cities is great motivator for hoteling and virtual meetings. Less driving should help reduce traffic and associated problems. Less flying should help the climate. Climate scientists are recording a tremendous amount of data right now on the effects of air quality during quarantine.

But there are still many jobs that must be done in person. There is always perception issues where people won't be able to understand without physically being there. So there are many limitations and it varies by industry and role.

[Saviolo]

8. As someone who's worked in the travel industry for 15 years.

Bullshit. Travel never has a spring back like that, it takes people a long time to get their confidence back for big ticket items like travel. It will come back, people always need to travel; Business, visiting relatives, and vacations, but it's going to take time for it to come back, and it won't be all at once. A few smaller region carriers and low-cost carriers I know of have already gone out of business permanently because of the situation, and I don't think we've seen the end of it.

Also, already low-cost carriers offering deep cut discounts is a big red flag in my head. Never buy those $1 fares when you see them advertised, those are a sign that the airline knows it is shuttering soon, and they are cutting their losses. I've seen it up close with several airlines that have gone out of business and stranded passengers. It doesn't always happen when an airline is about to close, but it's a good indicator if you see it happening.

[turbinetree]

11. I have been in the industry for over 25 years, and with this situation airlines are going to merge

or become national carriers or they will just disappear like some are doing right now over in Europe, and it will happen here, supply chains are in a mess because of shut downs, and the only thing in aviation that is remotely still operating is defense industry which is a essential business, and space programs, and the gas for filling an airplane isn't hedged for some long term situation and the oil prices are in free fall so to speak, filling a airplane with operating costs per hour cannot be sustained by per passenger mile revenue, if no one is sitting in the seat living with the fear that the person sitting next to you is asymptomatic...
And yes your explanation is quite correct, I also have seen airlines go out of business or have merged, and it is not pretty............

It's nice for O'Leary to think of yesterday model, but there is new reality.............

[greenjar_01]

10. Ryanair is the UK Spirit Air

Lots of short jumps from Ireland to UK regionals, and flying vacation goers to the Algarve and southern Spain and whatnot. I want to see what kind of models this guy is looking at, because it sounds fucking delusional.

[a la izquierda]

13. I just bought a RT NYC to LHR

$600 leaving Mid-June and coming back (maybe) mid-August. That’s a good deal for summer travel.