Ryanair, the biggest ultra-low-cost carrier in Europe, has proceeded to tempt the ire of Deputy of the Azorean Parliament, António Lima. The left-of-center politician is irate that Ryanair is demanding subsidies from the Azorean government to keep flying to the Azores, even as Ryanair had a near-record €1.43 billion ($1.54 billion) profit in 2022.

Deputy Lima’s lament

As reported in BNN and the Portugal News, Deputy Lima has a rather tense view of negotiations between the Azorean government and Ryanair. Negotiations confirmed by the regional secretary for Tourism, Mobility and Infrastructure have seen the low-cost carrier demanding subsidies to continue flying to the Azores. Lima claims this is 'blackmail,' and is quoted as saying;

“Blackmail is part of Ryanair's way of acting, either to try to prevent legitimate strikes for better working conditions, or to extort subsidies from taxpayers in the regions and cities where it operates. Ryanair's threat to stop flying to the Azores constitutes one more example of the predatory way in which this company operates.”

Lima believes "the sky of the Azores is liberalized and anyone can fly, without limitations," meaning "there can be no direct or hidden subsidies". Lima also demands public accounting of any existing contracts with Ryanair in evident fury at the situation.

Ryanair is not a fan of subsidies

Ryanair, which employs about 70 workers at the Ponta Delgada base, is considering leaving the Azores. The issue is that Ryanair is feeling new cost pressures that make flights to/from the Azores unprofitable. It is worth noting here that the Azores provides a mobility subsidy to cap costs for Azores residents to all airlines that come, including easyJet.

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However, Ryanair has issued many a statement decrying subsidies to airlines. On May 24th, Ryanair issued a statement saying in part,

“During the Covid-19 pandemic over €40bn in discriminatory State subsidies has been gifted to EU flag carriers. Unless halted by the EU Courts in line with today’s ruling, this State aid spree will distort the market for decades to come. Europe’s emergence from the Covid-19 crisis with a functioning single market depends on airlines being allowed to compete on a level playing field. Undistorted competition eliminates inefficiency and benefits consumers through low fares and choice. Unjustified subsidies, on the other hand, encourage ineffectiveness and will harm consumers for decades to come.”

Ryanair also issued a similar statement on May 10th when it said it “welcomed the EU General Court’s rulings on discriminatory State aid favoring Lufthansa and SAS over other EU airlines.” Clearly, Ryanair is not a fan of subsidies, and yet it sees fit to demand subsidization from Azores in order to continue services.

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Ryanair has had a profitable year

Despite soaring operational costs, Ryanair raked in a near-record €1.43 billion ($1.54 billion) profit in 2022. Fares grew 10%, in line with operational costs, but the load factor averaged 93% for 2022, giving the airline more cash per flight. Clearly, Ryanair is in good financial health. The airline is also planning for growth in 2023.

Simple Flying did attempt to reach a Ryanair spokesperson via telephone and e-mail to respond to Deputy Lima’s lament and the seemingly contradictory situation. Regrettably, no response was received by press time nor found on Ryanair’s website or social media.

What is your assessment of the situation? Please share with civility in the comments section.

Sources: Newsavia, ThePortugalNews.com

• 

  Ryanair

  IATA/ICAO Code:

  FR/RYR

  Airline Type:

  Low-Cost Carrier

  Hub(s):

  Dublin Airport, London Stansted Airport, Milan Bergamo Airport

  Year Founded:

  1985

  Airline Group:

  Ryanair Group

  CEO:

  Eddie Wilson

  Country:

  Ireland