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Ryanair fights back

Posted by Helen Wednesday, May 26, 2004

Michael O’Leary, the chief executive of Ryanair, usually described as “colourful”, does not mince his words. He accused the Transport Commissioner, Loyola de Palacio of trying to restore a “communist valhalla” of uniformly high air fares throughout Europe.

Mr O’Leary is going to the European Court of Justice to appeal against the Transport Commissioner’s ruling that the special deal Ryanair had done with Charleroi airport, near Brussels, (incidentally, allowing that airport to survive and turn in a profit) was a case of illegal subsidy. De Palacio also asserted that such a deal could not have been done with a private airport. Mr O’Leary described the ruling variously as “North Korean-style”, “asininely stupid” and, more succinctly, “bullshit”.

Ryanair, according to its chief executive has been inundated with offers from publicly and privately owned airports but fighting the Commission decision was a matter of principle. In his opinion, the Commission was acting against free competition and against the interests of providers and consumers of service. There was no question in his mind: a publicly owned company has the right to make the same sort of a deal as a privately owned one. And it is hard to understand what the Commission wants: for airports to use the subsidy to help keep fares high and undermine their own profits? Would that be a good way of using money?

So determined is Michael O’Leary to fight the case that he is ignoring the fall in his company’s share price.