Antitrust investigation for abuse of dominant position? «A complete failure from those who defend pirate agencies». President Di Palma’s (ENAC) fears about an oligopoly in the aviation sector? «Antics». The algorithms, record prices and hidden costs? “They don’t exist: consumer associations are lying.” Michael O’Leary, CEO of Ryanair, in this interview with The messenger, responds to everyone.
The number one “low cost” company, as well as the leading air carrier in Italy, admits, however, that the “offers at 9.99 euros no longer exist” and that now there are possible spaces, also given the company’s record profits, “for new cuts” to the cost of tickets. But only by around 3 euros per place and provided that “the other companies do not continue to reduce the planes”.
In the coming months Ryanair will sell millions of tickets for less than thirty euros. But the offers at 9.99 euros are no longer there and there are fewer routes at rock-bottom prices. Not only that: after tickets at 300 euros at Christmas and Easter, there are now off-season peaks of 150 euros. Why?
«There are certainly no longer offers at 9.99 euros per ticket, but now oil is at 90 dollars a barrel. Before Covid it was $65. Our biggest cost is fuel and the overall flight offering is shrinking. However, we have maintained millions of offers at low prices: we have managed to do this because we have balanced high-priced fuel with great business growth. Then there are more routes at reasonable prices.”
But in 2023 the price of fuel has dropped a lot. You are making billions in profits, yet you only gave 10% discounts after platforms like Booking excluded your flights. Why?
«The latest fuel prices for each flight for us have increased. We accumulate reserves that last at least a year, we will see the benefits of those purchased now next year. We have just launched a new offer with flights starting from 24.99 euros until June. I think we will then be able to lower the average price by 3 euros per place, but I cannot predict the future. Depends”.
Ryanair lowers flight prices: the move after Booking’s decision to exclude it from the booking portal
From what?
«From the capacity of flights in the Italian market: certainly if Ita Airways does not increase the offer and WizzAir and easyJet continue to reduce the number of planes in Italy there will be fewer and fewer seats and higher prices. So far we have limited price increases to between 3% and 4% in 2024, but this summer if supply reduces there could be increases of between 5% and 10%.”
However, even when there are low prices, in order not to leave with just a backpack, you can end up paying up to 289% more. Not to mention the hidden costs: +9% if, instead of buying the services with a package at the beginning of the payment, you buy them individually later. Isn’t that incorrect?
«In the past we included hand luggage in the standard ticket, but the average duration of trips has become 2.5 days: there is no longer any need to carry it on board! For the rest there are no hidden costs, we are the most transparent airline.”
A study by Federconsumatori confirms that that +9% exists.
“These associations lie, the only price that changes is that of the seats depending on the seat you choose.”
Dear low cost, tickets increase by up to 300 percent between extras and hidden costs
Let’s talk about algorithms. You denied using mechanisms to illicitly change prices. Yet when there was a flood in Emilia Romagna last year, and during a landslide in Puglia in March, prices soared before the seats on the planes filled up. Is there a “disaster” factor?
“No. We just have an algorithm that makes prices go up when planes fill up. We almost always have full flights and even more so after a catastrophe. There is no way we could calculate the catastrophe factor before it affects jobs and from a commercial point of view we are not interested. I would add that there are no links even with the chronology or the type of device from which the seats are booked: we don’t have time to try to understand it, given the millions of tickets we sell.”
Yet the Antitrust has opened an investigation into the incorrect use of algorithms.
«It will be a hole in the water. Before this investigation, a procedure had been opened for the price increase for Christmas 2022. They had to close it because they found nothing. The next day, to save face, they opened this investigation into algorithms. We have given them millions of data: they will not be able to find anything. On the other hand, the Antitrust is the same authority that defends pirate online travel agencies.”
Talk about the other proceedings for abuse of a dominant position. You would have hindered travel agencies, preventing discounts of up to 40-50% on the price of tickets. These are serious accusations.
“False. It is the online operators who carry out real scams, charging invented costs to customers, who thus pay up to 216% more. Why doesn’t the Antitrust investigate them?”.
Ryanair, the Antitrust: «Unfair competition, boycotts travel agencies and harms users»
In 2018 the Antitrust sanctioned eDreams for similar reasons. In any case, here we are also talking about physical travel agencies. Do they do scams too?
“No. We have never hindered them and we don’t want to. However, we do not have a dominant position in Italy and this is certified by a ruling from the Court of Milan. Also because in the internal Italian market there are railways and motorways.”
However, those are public services guaranteed by public companies. However noand in recent months you cut routes to Sicily and Sardinia after a government decree that tried to limit price increases. If new measures arrive will you cut other routes?
«We have good relations with the Italian government and in fact that decree has been modified. We didn’t cut routes for that reason, but because of supply issues. We will not cut them in the future.”
The president of Enac, Pierluigi Di Palma, calls for changing European rules to prevent oligopolies and protect consumers from price increases, especially towards islands and suburbs.
«The statements of Di Palma and other clowns are worth little to us: they are nonsense. Di Palma embarrassed the Italian government by proposing illegal rules, which in fact later changed. In any case, if the European rules are changed in the future we will respect them.”
Goodbye low-cost flights, 170 euros for off-season trips: prices increasing by 139% to go from Rome to Brindisi
Unions say your stewards, stewardesses and pilots cannot bring free water and food on board. You don’t provide them to them and they have to pay for it themselves.
«It’s not true, they can bring all the water and food they want on board. We’ll give them the water.”
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Tags: discounts ticket prices Antitrust pirate travel agencies
