Ryanair boss Michael O'Leary signals the end of ultra-low fares

Airline has weathered much of the storm of Covid but says the cost-of-living crisis is having an impact

A Ryanair plane takes off from Budapest Airport. The airline's boss Michael O'Leary has said the days of super cheap fares will not return for many years. AP

Ryanair, the budget airline that was among the pioneers of super low fares, will no longer be able to offer such cheap deals, its chief executive has said.

The trademark €1 and €10 ($1.21 and $12.15) fares will not be available for a “number of years” due to rising fuel prices, Michael O’Leary said.

In an interview with BBC Radio 4’s Today programme, Mr O’Leary said he expected Ryanair’s average fare to rise by about €10 over the next five years, from about €40 ($48.61) last year, to about €50 by 2027.

He told the broadcaster: “There is no doubt that at the lower end of the marketplace, our really cheap promotional fares — the €1 fares, the €0.99 fares, even the €9.99 fares — I think you will not see those fares for the next number of years.”

Ryanair has avoided much of the cancellations that have blighted other airlines such as easyJet and British Airways.

Mr O'Leary has been praised for holding steady during the Covid pandemic and not shedding staff in the same way as his competitors did.

He said he had been “part lucky and part brave” in his decision to ramp up training and recruiting last year, long before travel restrictions were dropped.

Mr O'Leary said he had “little sympathy” for airports that have demanded cancellations as they had notice of the schedules and should have been better prepared.

Heathrow has introduced a daily passenger cap to try to avoid scenes of chaos in terminals and several last-minute cancellations.

Although the increasing fuel prices, which are affecting the airline’s fares are also wreaking havoc on people’s disposable incomes, Mr O’Leary is confident the number of customers will remain steady.

Instead, he believes travellers will flock to lower-cost alternatives such as Ryanair and easyJet.

“We think people will continue to fly frequently,” he said. “But I think people are going to become much more price sensitive and, therefore, my view of life is that people will trade down in their many millions.”

In July, Ryanair posted an after-tax profit of €170 million ($174m) for the three months to the end of June, its first profit in the quarter in three years but well short of pre-coronavirus profit levels.

At the time, he criticised post-Brexit rules which he said still made it difficult to recruit staff.

“I can get visas to bring Moroccans to come in and work as cabin crew, but I can't get visas for Portuguese or Italians or Slovakian youngsters,” Mr O'Leary said.

Mr O’Leary today waded into the Tory leadership contest, saying the next prime minister should have the “backbone” to secure a deal with the EU to open up the free movement of labour.

“I think the first thing they should do to boost the British economy is prioritise a trade deal with the European Union — a good starting point for that would be to open up the free movement of labour between the UK and Europe once more,” he said.

Mr O’Leary, who said he accepted the result of the 2016 Brexit referendum, said: “You have to accept that you are not going to get elected by a very narrow 180,000 electorate of the Tory party membership if you advocate common-sense policies.

“But once you do become prime minister, you should have enough backbone to lead the UK economy forward and the starting point for that should be a free trade deal with the European Union.”

How Heathrow became a national embarrassment

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  Heathrow Airport in London, the UK's busiest, has been a travel hub for decades. Here The National takes a look back at Heathrow through the years. All photos: Getty Images

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  An Airco De Havilland biplane of the British airline, Aircraft Transport and Travel Limited, about to leave on the company’s inaugural flight from Hounslow Heath Aerodrome, later known as Heathrow, to Le Bourget, Paris, in August 1919

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  Waterlogged runways at London Airport - Heathrow's original name - one week before it became Britain's main aerial gateway to the US in 1946

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  The new BOAC maintenance headquarters at London Airport circa 1955

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  The air traffic control room at the airport's new terminal in 1955

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  US film star Marilyn Monroe with her husband, playwright Arthur Miller, after arriving at the airport in July 1956

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  An aerial view showing the runways in 1958

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  The arrivals and departures board in 1960

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  A new airport gift shop, selling items by Chanel, Wedgwood and Pringle of Scotland, in 1961

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  The Queen's Building and the No. 1 Building Europa at Heathrow in 1965

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  The Beatles leave Heathrow for Salzburg in Austria, to resume filming of the movie Help!, in 1965

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  Passenger terminal gates at Heathrow in 1966

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  Keith Granville, managing director of BOAC, holding up a model of the Boeing 747 jet, with the new aircraft hangars under construction in the background, at Heathrow in 1969

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  An aerial view of Heathrow in 1970

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  Passengers boarding the first BOAC Jumbo Jet 747 used for a commercial flight, from London Heathrow to New York, in 1971

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  Passengers going through the departure lounge at Heathrow in 1973

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  Concorde takes off from Heathrow on her first commercial flight for British Airways in 1976

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  Men at work finalising the Heathrow Central underground station before its opening in 1977

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  Queen Elizabeth II passing though the Tube gates at Heathrow Central station on its opening in 1977

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  An aerial view of Heathrow in 1978

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  Passengers waiting near a departures board in 1979

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  Holidaymakers waiting in the departure lounge at Terminal 3 of Heathrow in 1981

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  British Airways employees protesting at Heathrow in 1984

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  Passengers and staff observe a silence in Heathrow's Terminal One to mark the beginning of the funeral of Diana, Princess of Wales, in 1997

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  Rower Steve Redgrave at Heathrow with daughters Sophie and Natalie and son Zak after returning from the Sydney 2000 Olympic Games with his gold medal

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  Spectators watch the last Concorde land at Heathrow in 2003

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  Fans surround the coach carrying the England rugby team at Heathrow, as they arrived from Sydney after winning the World Cup in 2003

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  Heathrow's Terminal 2 in 2004

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  Passengers queue to check in at Terminal 1 of Heathrow Airport during the Christmas 2006 and New Year period

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  Passengers wait at Terminal 1 on August 10, 2006, after airport security was raised to critical when a terrorist plot to blow up planes in mid-flight from the UK to the US was disrupted by police

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  Planes queueing to take off at Heathrow in 2007

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  The new Terminal 5 at Heathrow in 2008

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  Aircraft at Heathrow Airport in front of the London skyline in 2016

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  Members of Team GB arrive from Rio de Janeiro at Heathrow, after returning from the 2016 Olympics, which saw Great Britain's strongest performance at the Games in over a century

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  A composite photo shows planes taking off from Heathrow in November 2016. Forty-two planes were captured between 10.17am and 11.17am and a montage was created from those single images

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  Items are arranged during an auction preview at Heathrow in 2018. The contents of Terminal 1, which closed in 2015, were being sold

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  An airline passenger wearing a face mask pushes her bags through Heathrow's Terminal 5 during the coronavirus pandemic in 2020

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  British Airways employees welcome Olympians returning from the Tokyo Olympics in 2021

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  Travellers wait in a long queue to pass through the security check in 2022