Ryanair has predicted that at least one European no-frills carrier would go bust this year because of an ongoing price war.
The Irish airline said it is expecting its fares to drop by between five and 20 per cent this year, which in turn is likely to reduce its post-tax profits by some 10 per cent.
According to The Independent newspaper, boss Michael O’Leary stated that even if fares drop by 20 per cent, Ryanair will still break even because its traffic is predicted to increase from 23 million to 28 million in the next 12 months.
O’Leary is quoted as saying: “This coming winter will be awful again and we cannot expect some of our competitors to survive. It is inevitable that there will be some casualties.”
He reportedly singled out bmibaby, MyTravel Lite, FlyBe, Germania, German Wings and Hapag Lloyd Express as those carriers “most exposed”, adding: “They won’t all go bust but there will be consolidations, acquisitions and mergers.”
Report by Tim Gillett, News From Abroad
