Ryanair has been at Cardiff Airport but now that is will be returning what will be its relationship with the airport asks Martin Evans
The recent announcement that Ryanair is returning to Cardiff Airport, even though they operate into Cardiff’s close neighbour, Bristol Airport, has been taken as a sign that after a return to the public sector, Cardiff Airport is now returning to success.
Ryanair has been seen as the holy grail for passenger numbers at Cardiff Airport, just get Ryanair to the Airport and all the routes and passengers that we want will be delivered. Of course, as the largest low cost airline in Europe, Ryanair cannot be ignored.
However before we all get out the atlas to find out if Ryanair can get us anywhere near our destination and scramble for our low cost seats, can Ryanair and more importantly should Ryanair be the answer to all our prayers?
We shouldn’t become too excited at this stage, Cardiff will have one route, once a week to Tenerife during the winter. However, there is a wave of optimism that this one route will develop into a network that will improve the airline offering at Cardiff.
There is, however, a history to the relationship between Ryanair and Cardiff Airport. Ryanair had a very successful route between Cardiff and Dublin from 2001 to 2006. The departure of Ryanair followed a reported disagreement with the airport over airport charges.
At this time Cardiff Airport was heading towards its highest ever passenger numbers and was profitable.
It was possible that Ryanair could develop more routes but at a cost of lowering aeronautical income at a time when Cardiff Airport had airlines that were willing to pay higher rates.
Cardiff already had a low cost airline, bmibaby, that wanted to expand. Indeed, the airport expanded past 2 million passengers a year but bmibaby didn’t continue to expand in a way that was expected and capacity increases by the airport were not matched by the airline.
Ryanair expanded rapidly by negotiating low charges at airports that they wanted to operate from. Airports had to be hopeful that income would rise once these cheap deals expired.
Ryanair wanted to extend these cheap deals to maintain a low cost base and continued to maintain pressure on airports by withdrawing from airports that raised their charges. Government also became a target where Ryanair didn’t like new taxes and charges.
The effect on secondary airports could be extremely severe where Ryanair operated the majority of the flights. Ryanair could make these threats because of the mobility of aircraft and their ability to sell new destinations through the interenet.
The loss of Ryanair had two effects upon Cardiff Airport. Firstly the nature of the Dublin route changed. It went from being a low cost airline route encouraging visitors to both cities to a regional airline route serving business passengers and encouraging passengers to transfer onto long haul services at Dublin.
Secondly, Ryanair decided to establish routes at Bristol Airport, Cardiff’s closest competitor airport that had already experienced faster growth than Cardiff due to low cost airline, Easyjet. Cardiff Airport was losing a low cost route, at the same time as their main competitor gained another low cost airline.
So why do Ryanair and Cardiff Airport need each other again? It is obvious for Cardiff Airport. Although they have replaced the routes that used to be operated by bmibaby, they haven’t replaced the passenger numbers. Vueling, the airline that has become the main low cost airline at Cardiff does not have the market penetration achieved by Ryanair.
Ryanair maybe Europe’s biggest low cost airline but it still needs to look for new opportunities for its ever expanding fleet. Other low cost airlines such as Easyjet and Vueling want to expand their market share and will offer services that can compete with the legacy carriers to do so.
So they will offer flights that use major airports to get you closer to your destination, allocated seats and the option to alter reservations before the flight.
These carriers are offering what the market wants and suddenly Ryanair, with the attitude of we’ll get you from A to B but sometimes with penalty charges, take it or leave it, looks out of step.
Ryanair has now seen the opportunity of appealing to the business market and this will improve the experience for all passengers.
So, yes, Ryanair is an opportunity if the passenger numbers on the new route convince Ryanair to develop even more new routes. However Ryanair would need to deliver substantial passenger numbers to compensate for the lower charges that will be paid.
It would also be necessary to maintain the existing carriers as competition so that Cardiff doesn’t become an airport totally reliant on a single carrier that is using market power to continuously drive down airport income.
Sourced from Walesonline