With soaring energy prices, which accelerated with the war in Ukraine, the era of plane tickets sold off at €10 or less is over, warns the boss of low-cost airline Ryanair , Michael O’Leary.
“I don’t think there will be ten euro notes anymore, because oil prices are much higher since Russia invaded Ukraine. Our really cheap promotions […]I think we’re not going to see these rates for a number of years,” he told BBC Radio 4 on Thursday.
Low-cost airlines such as Ireland’s Ryanair or its British rival Easyjet have shaken up air transport over the past twenty years and slashed prices, participating in a jump in short trips, in particular urban getaways at the end of the week.
And according to Mr O’Leary, average ticket prices on Ryanair are set to rise by a few tens of euros, to around €50 each way in the next five years.
Which, given the tariff structure of low-cost airlines, with many supplements, especially for luggage, could quickly increase the total cost of a round trip to several hundred euros or pounds and undermine demand .
Fall in purchasing power
The surge in oil prices over the past year (+36% for Brent listed in London) weighs particularly heavily on the costs of so-called low-cost compared to traditional carriers, but it also weighs on household budgets.
Annual energy bills will increase by several thousand pounds on average per household in the coming months in the United Kingdom, where inflation could exceed 13% by October, according to the Bank of England.
Faced with price increases that are cutting into the purchasing power of the British, strikes are multiplying in the country and are also affecting the air sector: security personnel at Leeds Bradford airport (north of England) have thus announced Wednesday evening a strike at the end of August for wages, which promises to disrupt returns from vacation.
However, O’Leary wants to believe that demand for air travel will continue and that, in the face of consumer budget constraints, low-cost carriers will do well.
He also protested Thursday against Brexit, which has sharply reduced access for European workers to the United Kingdom, where they previously held hundreds of thousands of jobs.
“The labor market is very tight, particularly for low-skilled jobs in the hotel and catering industry, distribution and agriculture, and also for security and baggage handlers at airports,” said the manager.
“What if there was a little honesty from the government [du premier ministre sur le départ Boris] Johnson, they would agree that Brexit was a disaster for the free movement of workers and that one of the main difficulties facing the British economy today is the lack of workers. »