The topic of airline consolidation in Europe has found new steam as International Airlines Group (IAG) said last week that its strong financials left it in a very good place to acquire more airlines. Sources claimed that the British Airways and Iberia owner may be looking to add UK budget airline easyJet to its portfolio of brands, causing the latter's stocks to rise significantly at the beginning of last week.

Meanwhile, on Monday, Ryanair Chief Executive Michael O'Leary predicted his airline could become Europe’s only major low-cost carrier, with competitors becoming targeted for takeovers.

Rivals are "mid-airfare, mid-cost"

O'Leary, not known for holding back with his opinions and projections, made the comments on a call with analysts following the release of results for the first half of Ryanair's financial year. As reported by Reuters, he stated,

"Europe is inexorably moving towards a similar out-turn as North America where you will have three very large, somewhat higher cost, high-fare connecting carriers, and one very large low-cost carrier."

Speaking about both rivals easyJet and Hungarian budget carrier Wizz Air, O'Leary stated that the two airlines,

“...would be candidates for M&A over the next couple of years because … they are stuck in a space where they are mid-airfare, mid-cost, and they are not able to compete with us on cost or pricing.”

easyJet says "no realistic prospect"

Meanwhile, the Ryanair boss did praise his UK competition, easyJet, for establishing a “fortress-like” position at attractive airports such as London Gatwick and Paris Charles de Gaulle, Geneva and Zurich. However, he also stated that Ryanair was forcing easyJet to back down in other prime leisure markets, Italy and Portugal.

Folks over at easyJet were not entirely convinced about O'Leary's plans for LCC hegemony, however. A spokesperson for the airline said that,

"...millions of consumers in Europe will be relieved to hear there is no realistic prospect of Ryanair becoming the only low-cost airline in Europe."

On Wizz, O'Leary said that while the LCC is expanding significantly in the Middle East, it is also retreating where Ryanair is instead gaining market share, even in Wizz's core markets of central and eastern Europe. While the airline is yet to offer any comment on O'Leary's statements, Wizz's CEO, József Váradi, has previously said that he does not see his carrier as susceptible to takeover attempts.

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Lone major LCC or not, Ryanair on track for record performance

Ryanair posted a pre-tax profit of €1.4 billion ($1.398.5 billion) in the six months to the end of September. This can be compared to a net loss of €48 million ($47.9 million) in the same period last year. The airline flew 95 million passengers over the period, compared to 39 million the year before. And while new COVID variants might still derail Christmas holiday plans, Ryanair said it will increase its seat numbers by 10% this winter. It also predicted annual passenger numbers would hit 168 million, which would be a new record for the carrier by some margin.

What do you think, are easyJet and Wizz potential targets for takeovers? Could Ryanair remain alone on the European LCC throne? Leave a comment below and let us know.

Source: Reuters,

• 

  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