Ryanair saves over €50m by renegotiating its contracts with airports
By Laura Noonan
Tuesday April 08 2008
http://www.independent.ie/business/irish/ryanair-saves-over-euro50m-by-renegotiating-its-contracts-with-airports-1341262.html
RYANAIR has extracted savings of more than €50m by renegotiating airport contracts in recent weeks and has also quietly extended its management pay freeze to "more than half" the airline's staff.
However chief executive Michael O'Leary said the airline had failed to secure any cost savings at Dublin airport and is now planning to scale back its Dublin presence next winter.
The savings drive comes as the airline continues its war against rising fuel prices.
"We have no success on costs in Dublin or in Stansted, but at the other 140 odd airports we fly to, there has been almost universal reductions in not just airport costs but handling costs as well," Mr O'Leary said yesterday.
He added that the savings has been "a very large double digit million figure", hinting at savings above the €50m mark.
"We moved seven planes out of Stansted last winter, I think that number will rise and the process will start at Dublin," he said.
"There's only one way to deal with a monopoly like this and that is to reduce traffic."
Since December 2005, Ryanair has grown its Dublin fleet from 9 to 22.
A spokesman for Dublin Airport said management there were "keeping the situation under review".
"We expect Ryanair to inform the Dublin Airport Authority of any plans they might have directly, rather than running to the media for headlines," he added.
Mr O'Leary also confirmed that a management pay freeze has been extended to "more than half" of Ryanair's staff and now includes all employees who aren't tied into "multi year pay-increase deals".
Profits
"A pay freeze is a pretty good outcome," he said.
"If profits were to fall by something like 50pc in the next 12 months, it won't be a pay freeze next year it'll be a pay cut."
Mr O'Leary also put to bed recent speculation that he was planning to leave the airline in two to three years.
"I always say 'two to three years', it's a very moveable feat," he said.
"Really, there are two things I'd like to have addressed before I think it's appropriate to go.
"I'd like to have sorted out the Dublin Airport monopoly and two, we'd like to sort out the regulatory regime in Stansted.
"And frankly if I had a competing terminal at Dublin and the break-up of the London airport monopoly, I think that would be an appropriate time to go."
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