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THE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & LifestyleTHE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & Lifestyle

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Business

Ryanair Expects Summer Air Fare Increases to Slow

Ryanair Expects Summer Air
Getty Getty
Ryanair Expects Summer Air
Getty Getty

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Ryanair Expects Summer Air Fare:  According to Ryanair, prices for the busiest summer months will either stay the same or be “modestly” higher than last year. The airline has noticed that recent airfare rises have been less than expected, even though it anticipates strong demand for flights in July and August.

 Ryanair CEO Michael O’Leary attributes the current pricing trend to a ‘recessionary feel around Europe ‘, a factor that has influenced the airline’s decision to increase fares by 20% despite a 34% rise in profits for the year ending in March, which Ryanair reported as €1.92 billion (£1.64 billion).

 Air travel has been steadily increasing in demand ever since the COVID-19 pandemic limitations were lifted. Flight demand is expected to be high this summer, according to EasyJet and British Airways owner IAG. With an average rate increase of 21% to €49.80, Ryanair handled 183.7 million passengers in the year leading up to March.

 Last summer, Ryanair had record-breaking trading and intense traffic throughout Easter in March. Nonetheless, this was somewhat mitigated by a fall in passenger numbers towards the year’s conclusion, when Ryanair flights were removed from several online travel agencies.

 Even if rates have not reached the predicted levels, bookings for this summer are now ahead of last year. O’Leary says, “We still see reasonable strength in July and August bookings, the peak summer months, but April, May, and June are a little bit weaker than we had originally expected.” He maintains his “cautiously optimistic” outlook, predicting that peak summer fares in 2024 will be relatively stable compared to summer 2023.

 Consumer sentiment or a generalized European recession might be to blame for the unexpected price freeze.

 The delay in new Boeing plane deliveries has significantly impacted Ryanair’s expansion plans. If the new planes arrive on time, the airline may accommodate 198–200 million customers this year. However, the potential for additional postponements and the absence of approximately 23 Boeing 737s that were supposed to arrive by July’s end are causes for concern.

 According to O’Leary, Ryanair will get compensation from Boeing for the delays. However, the reimbursement would be “modest” and won’t cover the expenses of reducing its growth ambitions. The airline and Boeing are collaborating closely to enhance delivery speed and quality.

 After a disaster in January when a panel of a Boeing plane blew out while in flight, the company’s production methods have been under close examination. Due to this monitoring, deliveries have slowed down. Dave Calhoun, Boeing’s CEO, has stated his intention to resign by year’s end. Although there have been improvements in the quality of aircraft deliveries, progress in quickening those deliveries needs to be improved, according to O’Leary, who also noted that Ryanair appreciated Boeing’s management reforms.

 Ryanair’s decision not to publish profit estimates for the current year is driven by a risk management strategy that prioritizes avoiding negative occurrences. This includes potential conflicts like wars in the Middle East and Ukraine, significant disruptions to air traffic control, and further delays in Boeing deliveries, all of which could significantly impact the company’s financial performance.

 Relatedly, a family lost £165 in a disagreement over a Ryanair check-in, and the airline has warned that fresh jet delays could lead to a 10% fare hike. In addition, following a dispute with booking sites, Ryanair recently reduced its profit prediction.


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