Ryanair’s CEO stated that EasyJet’s improved fare performance in the April-June quarter does not signal any issues with Ryanair’s strategy. Instead, he attributed EasyJet’s better results to weaker comparisons from the previous year and slower traffic growth.
After revealing quarterly statistics showing average fare drops of 15%, Ryanair’s share price saw its steepest daily decline since 2016. Meanwhile, EasyJet’s shares rose more than 4% on Wednesday following the airline’s announcement that its revenue per seat for the quarter had increased by 1%.
O’Leary mentioned in an interview with Reuters on Wednesday, “While they are outperforming us in terms of pricing, their growth is significantly slower, and they have yet to recover their pre-COVID traffic levels fully.”
EasyJet carried 25.3 million passengers during the same period in 2019, 4% fewer than Ryanair’s 55.5 million passengers during the same period in 2019.
In the last quarter, Ryanair increased its passenger numbers by 10% year-on-year. The airline has been expanding rapidly into new markets like Albania and has also launched new routes in its major markets, including Italy.
O’Leary noted that a small contributing element to the weakness of Ryanair’s average fares was a boycott by certain online travel agencies. While some agencies have given up on selling Ryanair tickets, others have struck new agreements to continue doing so.
EasyJet CEO Johan Lundgren told reporters on Wednesday that the price climate was comparable to last year, despite O’Leary’s statement on Monday that the trend in fares was “downwards and weaker.”.
He stated, “We’ll come in a little bit better than our -5%,” referring to the best-case estimate for the drop in average fares for the July to September quarter. “If easyJet is right and prices are flat in the September quarter,” he remarked.
