One More Thing: Airline executives sending mixed signals
Ryanair chief executive Michael O’Leary confessed to CNBC this week that he “hates JFK”.
He meant the New York airport – not the former US president. O’Leary told the US business channel’s Power Lunch show that he likes Newark airport in New Jersey and generally opts for United Continental when he flies transatlantic. This is despite the fact Aer Lingus, in which Ryanair holds a near 30 per cent stake, offers a transatlantic services to JFK.
The Ryanair boss was discussing the airline’s recent order of 175 craft from Boeing. That is valued at €12 billion, according to list prices, but the Irish company says it is buying the planes at a considerable discount.
CNBC’s Power Lunch anchor, Michelle Caruso-Cabrera, remarked that Ryanair’s expansion was hardly down to “exploding” demand in Europe. True to form, O’Leary responded that it was more of a case of “exploding flag carriers” and told her that everyone is trading down to low-fares airlines, led, of course, by Ryanair.
Driving down fares
He also repeated his argument that short-haul craft could do without either their galleys or one of their three toilets, to make room for yet more seats, a move that he claims would drive down fares further and save his company’s 80 million passengers up to €500 million.
Meanwhile, yet another Aer Lingus shareholder was making its presence felt at this year’s SITA Air Transport Summit in Brussels.
In the course of his speech, James Hogan, chief executive of Etihad Airways, said that the Gulf carrier holds 3 per cent of Aer Lingus “currently” – before pausing and adding that he supposed some journalist would pick him up on the remark.
It was not the first time that Hogan has signalled that his company is interested in increasing the ties between the two that include a code-sharing deal as well as the shareholding, which is precisely 2.87 per cent.
The State’s 25.1 per cent stake in the former national airline will ultimately be sold, although not, it appears to the biggest shareholder, Ryanair, whose latest takeover bid was blocked by the EU.
Hogan has made it clear to the media several times that his company is watching developments at Aer Lingus, and has also referred to its close relationship with Christoph Mueller, the Irish airline’s chief executive “ and his team” in Dublin.
Along with Aer Lingus, Etihad owns stakes in a number of its partners – 29,9 per cent in Air Berlin, 10 per cent in Virgin Australia and 40per cent in Air Seychelles – but Aer Lingus is one about which he has been most vocal of late.