Introduction
Ryanair is headquartered in Dublin, Ireland and operates a low-fare, no-frill scheduled
passenger airline. Ryanair serves short-haul, point-to-point routes between Ireland, the
United Kingdom, and continental Europe, making Ryanair Europes largest low-fare airline.
It has destinations in 13 countries with 76 low-fare routes. Its fleet consists of 21 Boeing
737-200s and 21 737-800s. Launched in 1985, Ryanairs growth has been extraordinary.
Ryanair currently employs a team of 1500 people and will carry over 13 million scheduled
passengers in the current year (2002). In 1986, Ryanair broke the high fare cartel, which
was then operated by the two state airlines Aer Lingus and British Airways in the
Dublin-London route. The first four years Ryanair was carrying 600,000 passengers
annually, but had managed to lose 20million pounds.
Under a new management team, headed up by Michael OLeary, a major overhaul of the
airline was undertaken in 1990/91. With Ryanair re launched as the very first new breed of
Low-fare, no-frill airline, adapting the formula so successfully pioneered by south West
Airlines in the U.S, non profitable routes were eliminated, the network was cut back from
19 to just 5 routes and air fares across the remaining network were substantially reduced.
For example, on Dublin-London route, a new promotional fare of just 69 pounds returns
was launched which stimulated a whole new era of growth for Ryanair. The companys goal
was to be profitable on new routes from their inception, by pitching their fares to be low
enough to attract new customers but high enough to provide a satisfactory operating
margin. By 1991 Ryanair recorded its first ever profit despite the damage done to the
Airline industry by the Gulf war in 1991. Over the next couple of years Ryanair
substantially slashed its fares further and managed to open up many new attractive routes.
The new formula effected a turnaround in the fortunes of the company, and by 1997 the
company was floated in an IPO on the Dublin Stock Exchange and on NASDAQ.
Last decade Ryanair launched an average of 10 new destinations every year. Despite this
success, Ryanair remained committed to driving down airfares. Ryanair was competing
head to head with many of Europes biggest airlines including British Airways, SAS,
Alitalia, Lufthansa, Air France, and Aer Lingus, by offering an unbeatable package of low
fares, on-time flights, high frequencies and friendly in-flight service, Ryanair was
continuing to succeed and win increasing public and customer support.
Dubai based Emirates Airlines is one of the fastest growing airlines in the world and has
