At a time when many air travel prices have been rising and many have predicted the end of super-cheap travel, Ryanair’s outspoken CEO Michael O’Leary says low fares will go on and he doesn’t mind selling tickets at a loss,
Ryanair has famously offered a wide variety of fares, including tickets as low as £9.99 to £12.99—fares that are sometimes lower than the amount of tax the airline must pay on them.
O’Leary told the Independent (UK) that “There will always be periods of time, particularly at this time of the year—January, February before you get to the school mid-term break or the Easter holidays or summer—where we’re trying to fill flights. We’re happy to fill flights at loss-making air fares. So there will still be lots of low air fares.”
The airline advises investors that it follows a “yield passive strategy whereby seats are priced to ensure that high load factor targets are achieved.” While that might seem counter-intuitive, preferring volume over profit, it’s not as odd as it seems, since Ryanair is known for making the bulk of its profit from fees added to the ticket price for, among other things, checked bags, seat selection, onboard sales, printing boarding passes and more. O’Leary is known for occasionally floating such ideas as charging for lavatory use or fitting more passengers by eliminating seats in favor of stools.
