Outspoken boss of Ryanair Michael O’Leary has today predicted a strong return of passenger air traffic by next summer. With an effective distribution of the vaccine, he predicts an ‘invasion of the beaches’ around Europe and a return to up to 80% of pre-COVID short-haul traffic.
A long recovery period is ‘rubbish’
We’ve heard from numerous airline CEOs, aviation bodies and industry pundits about how long and terrible the COVID recovery period is going to be. Airlines have parked up fleets of aircraft, trimmed workforces, and slashed schedules, predicting three, four, or even five years of sluggish travel demand going forward.
It’s quite a refreshing change, then, to hear from an industry CEO who thinks rather differently. CEO of the Ryanair Group and aviation veteran Michael O’Leary spoke this morning at the World Travel Market about his vision of the future. Contrary to popular opinion, he believes that passenger volumes will return quickly, as soon as next summer in fact. He said,
“I’ve heard lots of rubbish coming out of mainly the legacy airlines, ‘Oh, it’ll be 2050 before the world recovers from this, it’ll be 2025 before volumes go back to where they were in 2019…’, rubbish!
“Volumes will go back in 2021 and 2022 pretty quickly. They will go back because the airlines, led by Ryanair, will discount prices. Hotels will discount prices in the summer of 2021, the winter of ’21 and into the summer of ’22. We will all discount to try to recover the business we lost.
“I think the volume recovery will be quite strong … It will take a longer period of time, three or four years, for pricing to recover to 2019 levels. But I think the volume recovery would be strong and maybe surprisingly so.”
It’s an interesting take on the situation, and is likely a fairly accurate projection of how next year will look. Ryanair is famous for underpricing its services just to get bums on seats, and post-COVID, this strategy will be more valuable than ever.
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O’Leary preparing for an ‘invasion of the beaches’
Ryanair has stood out from the crowd throughout the pandemic in that it never really stopped flying. Sure, some of its aircraft had a bit more downtime than they were used to, but overall the airline has been very active.
Even those aircraft that are being underutilized right now are being kept current, operating regular flights to avoid the need for heavy maintenance down the line. Ryanair has done the same with its pilots, too, with each one having flown at least once a month. O’Leary believes that this is what will help his airline recover faster than any of its competitors. He said,
“We’re keeping the pilots current, we’re keeping the aircraft current, so that we can pounce on the growth. I think there’s going to be an enormous snapback in travel demand.”
He noted how the issue has become clear somewhat uncomfortably close to home, as Mrs. O’Leary is chomping at the bit to get away after now 12 months with no holiday. He thinks the situation will be the same in many households around Europe.
“We’re not going to go back to long haul for summer 2021. There’s going to be an invasion of the beaches of Spain and the Algarve Canaries and the Balearics and Greece … they’re really going to see a surge of interest of European tourists next year, and we need to be there providing the capacity and at low prices, keeping fares down.”
The vaccine would mean a return to business as usual
Overall, O’Leary is hopeful that the news from Pfizer yesterday about the potential for a functional vaccine means travel will return to normal sooner rather than later. He noted that another three vaccines are also in the pipeline to be licensed by Christmas. Even with the prioritization of distribution to those most in need, by summer, we could be in a very strong position. He said,
“There’s reasonable optimism now that summer 2021 will to get back to some degree of normality. We may not get back all the way to 2019. But in short-haul, I see no reason why we won’t go back to 75% or 80% of 2019.”
It’s possibly the most optimistic airline CEO interview we’ve heard for many months, as is a small ray of hope in a very difficult year.