Ryanair will cut an average of four flights a day from Dublin to 15 British and European destinations next year amid a row over airport incentives and concerns over Brexit.
Launching the airline's summer 2017 schedule, chief marketing officer Kenny Jacobs confirmed that Ryanair would cut 3 per cent of seats at Dublin airport next year, reducing traffic there to 12 million.
The move will see it cut a total of around 1,580 flights, about four services a day, from Ireland's biggest airport to nine British destinations and six in continental Europe.
The UK routes on which the carrier intends cutting capacity include Birmingham, Edinburgh, Manchester and Stansted, while Brussels Zaventem and Paris Beauvais are amongst the European destinations on which it will reduce seats.
Mr Kenny said the airline expected demand for flights to the Republic from Britain to ease as sterling continued to weaken following the UK's vote to leave the EU.
Incentive payments
He stressed that while this partly motivated the cuts, the main driver was a lack of clarity from Dublin airport’s operator, State-owned
DAA
, over the future of incentive payments given to airlines to encourage them to grow traffic.
The carrier’s chief executive, Michael O’Leary, confirmed that Ryanair “cannot get an answer” from DAA on the incentive scheme, which he said was normally renewed every March.
"Our additional capacity goes to whichever airport comes up with the best incentives," Mr O'Leary said. He pointed out that it would base 10 extra craft in Italy from next year after it had scrapped taxes levied on airports by municipal governments.
Ryanair will have an extra 50 craft next year, bringing its fleet close to 360. Mr O’Leary said it had a “list” of airports that have approached it with offers. “They all know that they are competing with each other.”
Dublin airport managing director, Vincent Harrison stressed that the incentive scheme remained in place.
“The growth scheme pays a rebate in airport charges to airlines that grow their overall business at Dublin and is open to all scheduled airlines at Dublin airport. Since 2011, under the growth scheme Dublin airport has paid €34.2 million in airport charges rebates to airlines.”
‘Safer’ sun destinations
Ryanair will increase flights from Dublin and the State’s other airports, Cork and Shannon, to Las
Palma
and Lanzarotte as it expects terror attack fears to prompt tourists to opt for “safer” sun destinations .
"We have seen an incredible surge in demand from people looking to go to Spain and Portugal next summer," Mr Jacobs said.
The airline believes that part of its growth next year will come from sunseekers in countries such as Germany and Britain heading to Iberia over the likes of Turkey.
Mr O’Leary reiterated that air fares would fall sharply through the rest of 2016 and up to the end of Ryanair’s financial year on March 31st. “Fares will fall 10 per cent to 12 per cent in the second half, which means that they will be down on what were very low fares last year.”
Ryanair is predicting that its full-year profits will be between €1.375 billion and €1.425 billion. However, Mr O’Leary said that if fares were to fall by more than 12 per cent, then the airline would revisit this.
The airline’s share price was up more than 2.2 per cent at €12.255 at 3pm on Thursday.
