Regis Duvignau / REUTERS
(Photo of a Ryanair Boeing 737-800 by REUTERS/Regis Duvignau)
TRANSPORT – The days of unbeatable Ryanair airline tickets are numbered. The airline’s CEO, Michael O’Leary, said on Wednesday August 10 that the latter will no longer offer tickets costing ten euros or less because of the rise in energy prices, which has been accelerated with the war in Ukraine sold.
“I think there will be no more ten euro bills because oil prices have been much higher since Russia invaded Ukraine. Our really cheap offers (…), I don’t think we will see these prices in a few years.”he said on the radio BBC radio 4 this Thursday, August 11th.
Low-cost airlines such as Ireland’s Ryanair or its British rival Easyjet have shaken up air travel over the past twenty years, lowering prices, resulting in an increase in short trips, particularly weekend city breaks.
Go from 10 euros to 50 euros in the next five years
And according to Michael O’Leary, average ticket prices on Ryanair are expected to increase by around €10 to around €50 each way over the next 5 years.
Which, given the cheap fare structure with lots of surcharges, especially for luggage, could quickly add up to several hundred euros or pounds for a total return trip and undermine demand.
The rise in oil prices over the past year (+36% for London-listed Brent) weighed particularly heavily on the costs of well-known companies “inexpensive” compared to traditional carriers, but it also weighs on the household budget.
Annual energy bills are set to rise by several thousand pounds per household on average over the coming months in the UK, where inflation could top 13% by October, according to the Bank of England.
O’Leary says rising prices won’t stop consumers
However, Michael O’Leary would like to believe that demand for air travel will continue and that airlines will, given consumer budget constraints “inexpensive” will drop out of the game.
He also protested on Thursday against Brexit, which has severely restricted European workers’ access to the UK, where they previously held hundreds of thousands of jobs.
“The labor market is very tight, especially for low-skilled jobs in hotels and restaurants, sales and agriculture, but also for security and baggage handlers at airports”the leader emphasizes.
“And if the (outgoing Prime Minister Boris) Johnson government were honest, they would admit that Brexit has been a disaster for the free movement of workers and that one of the biggest difficulties facing the UK economy at the moment is Brexit is shortage of manpower”.
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