Ryanair blames UK tax for cutbacks
RYANAIR has blamed air travel taxes for its decision to cut capacity by 17 per cent and axe seven routes from London's Stansted airport.
The budget carrier said that moving aircraft to parts of Europe that have scrapped air travel taxes would result in 2.5 million fewer passengers using Stansted.
The northern winter fleet at Stansted will now be just 22 planes, down from 24 last winter and 28 the year before.
The summer to winter reduction in fleet size will be even more dramatic as Ryanair normally operates 39 aircraft from the airport during the busiest months. The airline will also cut capacity at Luton airport by 15 per cent.
Michael O'Leary said that air passenger duty, which is added to ticket prices, was a self-defeating tax as it put off visitors.
He said a similar tax in Ireland had raised €80 million ($115m) a year but the country had lost €300m in sales taxes from reduced visitor numbers.
The UK government has proposed changing the tax so it applies per aircraft rather than per passenger, but the level of tax each individual pays is expected to stay the same.
The Netherlands and Belgium have scrapped their equivalents to increase tourist numbers, while Spain and Greece have also suspended their taxes.
"We have got to persuade the government that the way forward is not APD," Mr O'Leary said. "The way forward for the British economy and British jobs is lower access costs, otherwise people will go to other countries."
Ryanair will stop flights from Stansted to Friedrichshafen, Genoa, Granada, Jerez, Katowice and Reus this winter. It will reduce the number of flights it operates to Cork, Dublin, Vasteras, Lourdes, Milan, Pescara and Riga.
Ryanair also cut capacity at Stansted last year by 14 per cent and Mr O'Leary warned that he would continue to take flights out of the airport if high taxes and landing charges were not reversed.
"The government says people don't mind paying an extra tenner for their flight, but if that was true I'd have it off them long before the government got up in the morning," he said.
The budget carrier is also lobbying the European Commission to limit the amount of compensation it has to pay for cancelled flights after volcanic ash disruption earlier this year cost it €50m.
One man who paid €30 for his flight is claiming €3500 in extra expenses.
More than 1.5 million Ryanair passengers were affected by the ash cloud and 1.1 million have been given refunds. A further 100,000 have received compensation for hotel and food bills run up while waiting for flights to depart.
Mr O'Leary said an EU rule that requires airlines to give compensation to stranded passengers was unfair. He is proposing changes to prevent airlines facing unlimited liabilities in such situations. He also wants a cap on compensation so the amount paid reflects the amount the ticket was bought for, as applies to train and ferry journeys.
Ryanair also said that it was seeking compensation after British and European airspace was shut for six days in April because of volcanic ash from Iceland.
Mr O'Leary has written to the Civil Aviation Authority, the Met Office and the Department for Transport to establish which organisation gave the order to ground his flights.
"We are trying to find out who closed the airspace so we can sue them but nobody wants to own up to who is responsible," he said.
www.theaustralian.com.au
CIAO
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RYANAIR has blamed air travel taxes for its decision to cut capacity by 17 per cent and axe seven routes from London's Stansted airport.
The budget carrier said that moving aircraft to parts of Europe that have scrapped air travel taxes would result in 2.5 million fewer passengers using Stansted.
The northern winter fleet at Stansted will now be just 22 planes, down from 24 last winter and 28 the year before.
The summer to winter reduction in fleet size will be even more dramatic as Ryanair normally operates 39 aircraft from the airport during the busiest months. The airline will also cut capacity at Luton airport by 15 per cent.
Michael O'Leary said that air passenger duty, which is added to ticket prices, was a self-defeating tax as it put off visitors.
He said a similar tax in Ireland had raised €80 million ($115m) a year but the country had lost €300m in sales taxes from reduced visitor numbers.
The UK government has proposed changing the tax so it applies per aircraft rather than per passenger, but the level of tax each individual pays is expected to stay the same.
The Netherlands and Belgium have scrapped their equivalents to increase tourist numbers, while Spain and Greece have also suspended their taxes.
"We have got to persuade the government that the way forward is not APD," Mr O'Leary said. "The way forward for the British economy and British jobs is lower access costs, otherwise people will go to other countries."
Ryanair will stop flights from Stansted to Friedrichshafen, Genoa, Granada, Jerez, Katowice and Reus this winter. It will reduce the number of flights it operates to Cork, Dublin, Vasteras, Lourdes, Milan, Pescara and Riga.
Ryanair also cut capacity at Stansted last year by 14 per cent and Mr O'Leary warned that he would continue to take flights out of the airport if high taxes and landing charges were not reversed.
"The government says people don't mind paying an extra tenner for their flight, but if that was true I'd have it off them long before the government got up in the morning," he said.
The budget carrier is also lobbying the European Commission to limit the amount of compensation it has to pay for cancelled flights after volcanic ash disruption earlier this year cost it €50m.
One man who paid €30 for his flight is claiming €3500 in extra expenses.
More than 1.5 million Ryanair passengers were affected by the ash cloud and 1.1 million have been given refunds. A further 100,000 have received compensation for hotel and food bills run up while waiting for flights to depart.
Mr O'Leary said an EU rule that requires airlines to give compensation to stranded passengers was unfair. He is proposing changes to prevent airlines facing unlimited liabilities in such situations. He also wants a cap on compensation so the amount paid reflects the amount the ticket was bought for, as applies to train and ferry journeys.
Ryanair also said that it was seeking compensation after British and European airspace was shut for six days in April because of volcanic ash from Iceland.
Mr O'Leary has written to the Civil Aviation Authority, the Met Office and the Department for Transport to establish which organisation gave the order to ground his flights.
"We are trying to find out who closed the airspace so we can sue them but nobody wants to own up to who is responsible," he said.
www.theaustralian.com.au
CIAO
_goa
