All things being equal, it should take Ryanair about another five to seven years to become the biggest global airline by passenger numbers.
Yesterday, the carrier headed by Michael O’Leary said that it had become the first airline to ever carry more than 100 million international passengers in a year.
It said that it carried 7.5 million passengers in December, which was 25pc more than it did in December 2014. That brought the tally for 2015 to 101.4 million passengers.
It still has some way to go to become the world’s biggest carrier by passenger numbers, but it’s on track to eventually do so.
In 2014, US airlines Delta and Southwest each clocked up over 129 million passengers.
Ryanair’s own financial year ends in March, and it has previously predicted that during that 12-month period it will carry about 105 million passengers. It also expects to make a profit in the current financial year of about €1.2bn.
By 2019, Ryanair has predicted that it will be carrying 120 million passengers, and hauling 180 million by 2024.
It’s an astounding pace of expansion by any measure.
The growth in passengers numbers has been a function of adding more aircraft to its fleet and to its self-styled ‘Always Getting Better’ campaign, which has been paying huge dividends with its efforts to attract more business travellers and families.
Over the past couple of years, Ryanair has also stripped out or slashed many of the charges that its customers used to moan most about. Mr O’Leary had for years told his passengers that if they didn’t like the charges that they could get lost.
But the Ryanair volte face has seen it curry favour with a whole coterie of flyers who would previously have sworn blind that they would never fathom going anywhere with the carrier. It’s also targeting more and more primary airports to spur growth.
And all the while, it’s benefiting from lower fuel costs and more efficient aircraft, which helps it to continually push down fares.
Last September, Mr O’Leary told a gathering of Irish business directors that he will use falling fuel costs to keep chipping away at ticket costs.
“The average fare in Ryanair last year was €45,” he said at the time. “We a plan in the next five years to take that average fare down to about €25. We may not get there, but at least we’re determined to keep driving down the cost of travelling to make it more affordable.”
And although Ryanair has been taking delivery of more aircraft from Boeing, it has also been able to actively manage its yields, or the average price per ticket, and keep its planes almost full. The load factor – or percentage of seats filled – in December was 91pc, compared to 88pc in December 2014 when it had more aircraft grounded for the winter.
Ryanair is also expanding its footprint, having launched flights to Israel and confirming yesterday that it will return to Belfast in March, with a base at Belfast International Airport. It also unveiled extra seasonal flights from Dublin to Gatwick.
The airline will release third-quarter results on February 1, when any impact from lower fares it had to resort to following the terror attacks in Paris and Belgium will filter through.
“The one area expected to be slightly weaker than previously forecast is yield,” said analyst Mark Simpson at Goodbody Stockbrokers. Regardless, the airline has previously proven its ability to weather geopolitical tremors.
Independent.ie
Micheal O’Leary has BIG plans for Ryanair
Two years after announcing Ryanair would “be nicer to people”, its chief executive, Michael O’Leary is signalling yet another change at the airline. He says the company wants to become a sort of “Amazon for travel in Europe”, a website where you can buy your flight, rent your car, book your hotel room and even buy concert tickets.
It has, he says, the scale to do it. On the basis that the airline will be carrying 100 million passengers a year – and counting – he’s probably right. Not only that, businesses selling such things to travellers would surely be happy to have Ryanair offering their services to its customers.
This could mean problems for the growing band of online businesses that earn their crusts from fulfilling an Amazon-type role for various travel services. It is pretty clear that O’Leary has their markets in his sights when he says that the airline wants to “disintermediate all the disintermediators”.
In one way, this is simply history repeating itself. Ryanair was one of the first companies to realise that you could use the internet to “disintermediate” travel. Instead of going to an agent to book flights, consumers went to the airline’s website and cut out the middleman.
The airline has always offered services such as car hire through its website. The difference here appears to be that it has realised the potential it offers.
Along with its always-getting-better programme, the company has stepped up investment in development, with a big focus on working out how to sell more products.
It has also woken up to the fact that consumers are increasingly looking to the likes of Trivago and CarTrawler for various services. Presumably its thinking is: why let them have the business?
Ryanair is not always the first to twig something. US airline Southwest came up with the low-cost model, EasyJet saw how it could be adapted for primary airports and business travel.
However, once the Irish airline decides that it can make an idea work, it goes after it with a vengeance, and often ends up doing it better than anyone else. It is going to be interesting to watch it going after the disintermediators.
Irish Times