Ryanair in major Skavsta expansion
Published: 14 Jun 2007 09:12 GMT+02:00
Updated: 14 Jun 2007 09:12 GMT+02:00
Low-cost airline Ryanair has announced a major expansion at Stockholm Skavsta airport, in a bid to rub salt in the wounds of strike-hit SAS. The airline plans to launch 13 new routes to European cities, including Liverpool, Berlin and Valencia.
The destinations were announced in Stockholm on Thursday by the company's flamobyant chief executive Michael O'Leary, who was dressed in a Viking outfit for the occasion.
The Irish airline is launching routes to Alicante, Basel, Berlin, Bratislava, Eindhoven, Baden Baden, Liverpool, Malta, Pisa, Oporto, Salzburg Trapani and Valencia.
Eleven of the routes will be launched in October, with Trapani launched in November and Salzburg in December.
Once he had removed his Viking garb, O'Leary expanded on the company's plans at a press conference in central Stockholm.
The company is extending its fleet by purchasing two Boeing 737-800 aircraft, which it will base at Skavsta. The planes, costing $140 million, will expand Ryanair's Skavsta fleet to a total of six aircraft.
With the new flights, Ryanair will operate 28 routes in all from its Swedish base.
"This is another great day for Ryanair in Sweden," said O'Leary.
The chief executive was quick to praise the roles of Nyköping municipality and Skavsta Airport in securing the new deal.
Skavsta chief Dot Gade Kulovuori - introduced by O'Leary as "the most beautiful airport manager in Sweden" - was upbeat about the expansion.
"We will strive to keep on being one of your favourite airports and bases," she said.
O'Leary responded by outlining Ryanair's plans to "double in size" at Skavsta in the next few years.
Asked how Ryanair intended maintaining profitability in a period of expansion, the airline chief put a Swedish slant on the company's modus operandi.
"We are the IKEA of the airline industry. We will keep expanding through lower prices all the time", said O'Leary.
To illustrate the point, O'Leary pointed out that the company aims to release 100,000 tickets at 220 kronor each to coincide with the expansion.
Rival airline SAS was treated to a torrent of abuse by the Ryanair chief.
"Ryanair's low-price flights from Skavsta have been a tremedous success because Swedish passengers can't stand SAS's high prices and frequent strikes," O'Leary said.
On the issue of strikes, O'Leary also managed to slip in a quick jab at one of his long-time bugbears - trade unions.
"We have never had a strike in 20 years because we don't have somebody in the middle telling us lies," said O'Leary, adding that cabin crew at the airline had directly negotiated a 20 percent pay rise over the next four years.
SAS on the other hand was characterized as an airline troubled by regular industrial action and "going nowhere".
The restructuring plans announced by the Scandinavian airline on Wednesday were treated with scorn.
"Despite all the mumbo jumbo, what SAS are effectively saying is that they are going to jack up fares again. It is interesting that whenever they have things they want to say, dropping prices is never one of them," said O'Leary.
Speculating on the future of the airline industry, the chief executive predicted that SAS would eventually be swallowed up by Lufthansa and that the European market would consist of "four large airline groups" in ten years' time: Lufthansa, British Airways, Air France and Ryanair.
O'Leary also revealed that Ryanair's growth in Sweden is not going to be limited to existing airports such as Skavsta and Malmö.
"We have been talking to four or five additional airports in Sweden," said O'Leary.
He would not divulge the location of these airports except to say that "most of them are north of Stockhom".
As for rumours of a move into the transatlantic market, O'Leary said that this would not happen using Ryanair's name.
"But it is possible that we will set up a sister company flying eight or ten transatlantic routes," he said.
While it was possible that Sweden could provide one of the bases for such a move, there were no indications that this would happen any time soon.
"We will wait maybe until the next big crisis in the airline industry, then buy up a cheap fleet of aircraft," said O'Leary.
After 45 minutes it was time for Michael O'Leary and Nordic chief Wilhelm Hamilton to leave.
"We have to be out of here. We're on a very expensive SAS flight to Copenhagen," said O'Leary.