In the first quarter of 2012 the airline Ryanair saw its profits fall by around 30 percent, which is a significant decrease, and many people believe this is because of the austerity measures that are happening in the UK because of the recession, as well as the increasing fuel prices that have severely affected the largest low-cost airline operating in Europe.
Ryanair have released a statement saying that they are going to have to increase their fare prices in order to improve their profits situation. They stated that the fuel costs are simply putting too higher pressure on them and they are going to have to make things more expensive.
The carrier however said that they are only going to be increasing fares by around three percent this year, which is significantly lower than the increase of over 15 percent which was seen last year. These fares are being increased at about the same time as most people are facing lower levels of disposable income meaning they are travelling less.
The pre-tax figures for the airline were nearly £90 million, which is a decrease of 30 percent on the same figure for last year. The chief financial officer of Ryanair, Howard Miller has recently stated, “We understand that people are more financially strapped than they may have been in the past and therefore we are going to be limiting the amount we are raising our tickets to a very low figure.”
Mr Miller has not made a comment about the company’s recent bid for a takeover of rival airline Aer Lingus which is currently awaiting approval from the European commission. It is expected that information about this potential takeover is going to be released in mid-September. The European commission are said to have several concerns in regards to anti-trust issues.