Ryanair expects 2 billion euros more for jet fuel and seeks savings at airports and among crews
The Irish low-cost airline booked 15 percent less profit in the first half and is cutting winter flights; its finance chief does not rule out a pay freeze either.
Ryanair expects to spend 2 billion euros more on fuel next year because of the sharp rise in jet fuel prices. That emerged on Monday when the airline presented its half-year figures, La Libre and the Reformatorisch Dagblad report. Net profit for the six months to the end of September fell by 15 percent, from 2.5 to 2.2 billion euros, despite more passengers, Trends writes. Higher fuel costs and lower fares weighed on the result.
To absorb part of the extra cost, the airline is looking at several savings. Contracts with airports are being reviewed, Ryanair is considering flying with fewer crew members per aircraft and wants to make greater use of artificial intelligence. Chief financial officer Neil Sorahan said in an interview that everything is on the table, including a pay freeze, and that he expects high oil prices over the next twelve months. Ryanair employs more than 27,000 people, including around 8,500 pilots.
The airline is also flying a reduced schedule this winter. As a result, Ryanair now expects 214 million passengers for the full financial year, down from 216 million previously. Over the past six months fares fell, as travellers were more hesitant to book because of geopolitical uncertainty. Chief executive Michael O'Leary said last month that fares could rise by up to 20 percent by 2027 because of fuel prices.
Jet fuel prices have risen sharply since the war with Iran began at the end of February, as oil shipments through the Strait of Hormuz have been disrupted. According to Sorahan, the airline will have to tighten its belt over the next twelve months. How far the fuel bill eventually rises depends largely on how the conflict in the Gulf develops.