The Joint Committee met at 2.30 p.m.
Deputy M. Brady,
Deputy P. Breen,
Deputy J. Ellis,
Deputy J. Glennon,
Deputy S. Healy,
Deputy D. Naughten,
Deputy N. O'Flynn,
Deputy P. Power,
Deputy R. Shortall.
Senator F. Browne,
Senator T. Dooley,
Senator T. Morrissey.
In attendance: Deputies P. Bradford, J. Deenihan, B. O'Keeffe and C. Lenihan and Senator S. Ross
DEPUTY EOIN RYAN IN THE CHAIR.
Chairman: I am delighted to welcome Mr. Michael O'Leary, chief executive of Ryanair, and Mr. Jim Callaghan, the company's head of regulatory affairs. I draw attention to the fact that members of this committee have absolute privilege but this same privilege does not apply to witnesses appearing before it. I remind members of long-standing parliamentary practice to the effect that members should not comment on, criticise or make charges against a person outside the House or an official by name or in such a way as to make him or her identifiable. I ask Mr. O'Leary to commence his presentation.
Mr. Michael O'Leary: Thank you, Chairman. I probably cannot make a presentation after those introductory remarks because I am not now free to say what I think.
Chairman: That would be a first.
Mr. O'Leary: Thank you for your time. Probably the best way to deal with this is to give a brief presentation on Ryanair partly because the extent of the ignorance of what Ryanair does here is breathtaking. Few people seem to realise how big we are, how successful we are across Europe and the fact that this is the only country in Europe where what we do is not welcomed with open arms or encouraged. With your permission, Chairman, I will run through this presentation and will try to use slide format. After that, we will take questions or whatever.
Ryanair is Europe's number one low fares airline. We are number one on almost every front. We are by far and away the longest established. The airline started in 1985 as a loss making high fares airline and it was turned around starting in 1990 as a low fares airline. It is number one for traffic and this year we will carry 24 million passengers. That is six times the total population of this country and is four times the total number of passengers carried by Aer Lingus. Ryanair is four times larger than Aer Lingus in terms of passenger numbers. One will read much of our appalling passenger service and our frequently quoted disregard for our customers, yet, statistically, we provide the number one on time service, we continuously offer the lowest fares and we have the lowest costs.
We are number one in Europe for people productivity and for people pay. The average pay in Ryanair is now higher than the average pay in Lufthansa, British Airways, Air France and even Aer Lingus, yet we have an image - portrayed mainly by the unions here - of being a low pay, bucket shop employer. We are the highest pay airline in Europe and we are also the most productive. This year Ryanair will carry about 10,000 passengers for every employee. The equivalent figure for Aer Lingus, British Airways, Air France and Lufthansa is less than 1,000 - one tenth of our productivity. To put that in context, this year we will carry 24 million passengers with about 2,000 staff. Aer Lingus will carry six million passengers with 4,000 staff. We carry four times the traffic Aer Lingus does with half the staff.
We are number one for routes. We offer 125 routes across Europe and have nine bases. We are number one for market share in almost every market in which we have competition, primarily because we offer the lowest fares. I am also delighted to say we are number one for profitability and market capitalisation. The word "profitability" is often portrayed as a dirty word here but I fail to see why one is in business if one is not in business to make money. This is all the committee really needs to know about Ryanair.
The average fare on Ryanair last year was € 49. The closest to us in terms of average fare is easyJet-Go which is 70% more expensive at € 83. The average of the high fare airlines - this would include Aer Lingus - is somewhere between € 150 and € 300. Aer Lingus's average fare last year was € 158 while Ryanair's was € 49 and is in decline. Every passenger flying with Ryanair to and from this country saves on average more than € 100 which, in the past year, amounted to € 2.4 billion saved by the 24 million passengers flying with us.
We deliver huge traffic growth. I could get the graph to go back as far as 1990 when the figure was 400,000 but in 1995, we carried two million passengers per year. Last year we carried 16 million passengers and this year, with the inclusion of Buzz, we will carry 24 million passengers. In 1999, we carried just over five million passengers. From that period when we carried five million passengers to next year when we will carry 24 million, almost all that growth has been away from Ireland. None of that growth has been delivered in Ireland with the exception of the past three years in Shannon. One might ask why none of that growth has come to Ireland. It coincided with the appointment of a particularly incompetent Minister for Transport about five years ago who pursued a policy for the past five years of blocking low fare air travel.
Chairman: I ask Mr. O'Leary not to personalise his presentation.
Mr. O'Leary: My apologies. For the past five years the previous Minister for Transport blocked an offer from us every year to base aircraft in Dublin and Shannon Airports, to open up new routes from Dublin and Shannon Airports, to deliver new traffic to Dublin and Shannon Airports and to deliver an associated 1,000 jobs for every one million additional passengers delivered here.
These are our proposals which are welcomed with open arms all over Europe. The Belgian, German, Spanish, Italian, Swedish, Norwegian and Danish Governments and even the UK Government have created an environment where airports offer lower costs, more competitive and efficient facilities in return for dramatic low fare traffic growth. This country, which, if you like, ushered in the era of low fare air travel in 1990, has missed out on all that growth over the past five years and continues to miss out on it because the Government and the politicians have not adopted these kinds of policies. We are still propping up an expensive, high cost airport monopoly owned by Aer Rianta which continues to do everything in its power to limit this growth.
To put that in context this year, that is, the 24 million passengers per year, Ryanair will be running neck and neck with Air France to make it the third largest international airline in the world. In two years time, we expect to grow from 24 million passengers to more than 34 million passengers which will make Ryanair - a small, some would say, Mickey Mouse, Paddy airline - the largest airline in the world. We already have the advertising campaign ready which says "Ryanair, the World's Favourite Airline" since British Airways will no longer be able to use it in two years time.
Deputy Ellis: Is it not patented?
Mr. O'Leary: If it is, it will have to give it up in about two years time.
People here may have a view about Ryanair and about me - they are free to have whatever view they like about me - but no one can take away the success which the 1,800 people in Ryanair have achieved in recent years. Some would say it is because of me, while many would say it is despite me. We have 1,800 Irish people running the most successful airline in the world. They are running probably one of the most successful new company stories of the 1980s and 1990s here, yet, amazingly, this is the only country in which we are continuously blocked from replicating this success for the good of consumers and visitors to this country and for tourism.
In regard to our aircraft orders, we had 44 aircraft in 2002. In the next eight years, the number will increase to 150 aircraft. That will take us from 24 million at present to more than 50 million passengers. In fact, it will be much more than that. In terms of traffic growth, somewhere in 2005-06, Ryanair will pass out British Airways and Lufthansa to become the largest international airline in the world.
In regard to our route network out of London, we now fly to 59 destinations from London-Stansted. We fly to more destinations in Europe from London than British Airways. We carry more passengers from London to Europe than British Airways. In every market in which we compete with it, we out carry British Airways, the world's favourite airline. In many respects, it is remarkable for a small, Irish airline to be able to out carry what is perceived to be the world's largest and favourite airline. It is not even London's favourite airline - Ryanair is.
Unfortunately, Dublin has not grown in recent years for reasons to which, I am sure, we will come back. At present we operate 21 routes from Dublin - an extensive network mainly to the UK. The last new routes we opened from Dublin were to Paris and Brussels-Charleroi, which we started in 1997. We are running the new Faro, Malaga and Barcelona routes as a scheduled operation this year. They were a charter operation prior to this year.
We did not fly to Shannon until three years ago when we were challenged by the Minister and some members of this committee to demonstrate that we had a commitment to and could deliver something for Shannon. We launched four routes to and from Shannon in the past three years. We are running at just under one million passengers at Shannon per year - about half of Shannon's total traffic. The reason that is important is that when the Atlantic overfly goes and the Shannon stopover is removed, one million of Shannon's just over two million passengers will disappear. With what will we replace it? We can replace it with low fare services to and from the UK and Europe - we can replace it with Ryanair.
For five years we have advocated that Shannon be freed from the dead hand of Aer Rianta and be allowed to do deals with Ryanair on low cost terms. We would open up Shannon as a gateway for tourism to the west of Ireland. Unfortunately, having demonstrated that we could deliver huge and record travel growth at Shannon, Aer Rianta decided this year that it was time to increase costs at Shannon. It is a particularly inappropriate time to start to increase costs. With Irish tourism in the toilet, a worldwide recession, a war in Iraq and people not flying across the Atlantic, Shannon wants to increase costs for the only low fares airline which is growing traffic to and from Shannon. This is the behaviour and mentality of a monopoly.
Shannon, or Ireland, was about to lose the Frankfurt route because instead of sending the aircraft from Frankfurt to Shannon, we were going to send it to somewhere else in Europe where costs would have been less than one fifth of what Aer Rianta was charging at Shannon. As luck would have it, the Kerrymen, who are not shy about coming forward, called us on the Tuesday before we were to announce the pull out on the Thursday to say we could fly to Kerry for a great deal less than Shannon was charging. Kerry now has the route from Frankfurt. Shannon loses the route in two weeks time and it goes to Kerry instead.
The advance bookings to Kerry are higher than those to Shannon. It is not that people did not want to visit Shannon. With the greatest respect to the Shannon Deputy, there is nothing particularly unique or attractive about Shannon per se but as a gateway to the west of Ireland, it is very attractive to German, Italian and French visitors. So too is Kerry. The traffic and the routes will always go wherever the costs are lowest, yet the three main airports here are run by a Government owned monopoly which, during a worldwide recession and an international war, decided it would increase costs for the only airline growing business out of Shannon. That speaks for itself.
Glasgow-Prestwick was very much like Shannon and until the mid-1960s relied on the transatlantic stop-over traffic. It had about two and a half million passengers per year. Prior to 1997 when we started to fly there out of Dublin, it had no passengers. The airport had been closed and there were sheep on the runway. This year Ryanair will operate nine routes to and from Glasgow-Prestwick connecting Glasgow with the UK, Norway, Sweden, Ireland, France, Germany, Holland and Spain. This year traffic at Prestwick will be somewhere north of two million passengers. The reason that is important is that it is a model for what can be done at Shannon Airport. If we can deliver two million passengers to a place in the west of Scotland which had sheep on the runway, we can deliver to some place in the west of Ireland where if nothing intelligent is done, there will be sheep on the runway when the peace protesters and the American military are gone.
We have long since given up wanting to be Ireland's or the UK's biggest airline. We have been expanding our growth as we were rejected each year by the Irish Government and the Department of Transport. We simply allocated the new aircraft arrivals to other airports all over Europe where, quite remarkably, airports, ministers and governments desperately vie with each other to offer us better deals, terms and facilities to get us to fly to their local airport, city or region and transform their tourism. Brussels-Charleroi is the secondary airport for Brussels. I am sorely tempted to say that nobody in this room would know much about it since most politicians and civil servants still fly with Aer Lingus to Brussels-Zaventem.
Deputy O'Flynn: Mr. O'Leary should not take that for granted.
Mr. O'Leary: Good.Members are all very welcome.
Deputy O'Flynn: In fact, I have to declare a vested interest in that I am a regular passenger on your airline.
Mr. O'Leary: The Deputy is very welcome. We are delighted to have Deputy O'Flynn.
Deputy P. Power: I think we should charge an advertising rate.
Mr. O'Leary: I have not finished yet.
Brussels-Charleroi is a valid model for the development of Shannon or Dublin when we get to it and which is stagnant. Brussels-Charleroi had no routes and no traffic four years ago when we first showed up. This year it will have a network of 11 routes and will have more than two million passengers per year. It now has daily scheduled connections to Shannon, Dublin, Glasgow, Liverpool, all over the UK, Ireland, Italy, France and Spain. Again, these are tourism routes, traffic and jobs which were offered to Ireland but which were turned down.
We launched Frankfurt-Hahn on 2 February. This airport is 100 kilometres outside Frankfurt. Everybody said it would not work. It was a former NATO military base, again much like Shannon. The military had pulled out and there were no customers left. We went in there two years ago. This summer, we will operate 15 routes. They have built a new terminal for us. We will carry three million passengers per year to and from an airport where, three years ago, there were no passengers at all. This can be replicated at Shannon, Cork and Kerry.
Chairman: What are they charging you per person out of Frankfurt?
Mr. O'Leary: A very low cost per passenger.
Chairman: How much?
Mr. O'Leary: I would not tell you that, Chairman. I would not tell my mother that.
Chairman: Was it lower than nothing?
Mr. O'Leary: It was an immaterial sum of money on a per passenger basis.
Chairman: How would it compare with Dublin Airport in percentage terms?
Mr. O'Leary: Dublin Airport would charge over ten times more than Frankfurt.
Chairman: Mr. O'Leary is not finished his presentation yet.
Mr. O'Leary: We opened the Milan-Bergamo route in February 2003. We had no services there prior to February but will run seven routes this summer. Already in the first three months we have an 80% load factor. If we maintain that over a full year, we will deliver two million passengers this year to Milan. Thus, two million passengers will arrive in Milan in a year when Dublin Airport, if it grows at all, will grow by 1% or 2% and Shannon Airport will decline, probably by about 4% or 5% as a result of our withdrawal of the Frankfurt traffic. Aer Rianta will tell you that Ireland is losing passengers because of the Gulf War, the loss of duty free or whatever - anything other than admit that it is their fault.
Irish tourism is struggling because we are not targeting markets all over Europe. We can deliver four million visitors per year into this country, half of them into Dublin and half into the west. All we need is a low cost base and efficient airports. These are the only things missing in this country. The Stockholm destination opens on 6 April, and from it we will launch a network of routes to Finland, Denmark, Norway, Ireland, Germany and France. Nobody has the number of bases Ryanair has all over Europe. Our principal competitor, easyJet, is largely based in the UK. Each year for the last three years, the chairman of Aer Rianta has promised to shortly announce the arrival of a new low fares airline into Ireland, but we are still waiting.
I will touch briefly on the issue of passenger service because it relates to one of the issues I know you, Chairman, wish to raise - our no refunds policy. About a year ago, the high fares airlines and the EU got together and came up with a passenger charter. This is the most vacuous document ever agreed between a bunch of airlines and civil servants. It means absolutely nothing. There is nothing in the charter whatsoever. It commits them to very little except to reply to customer complaints and provide refunds within 28 days. We have refused to sign up to this charter because it is meaningless. We have produced our own customer charter, which offers passengers a much more comprehensive package of customer service. Ryanair is the only airline in Europe committed to selling the lowest fares all the time. We always have the lowest fares in every market. If somebody comes up with a lower fare than us on any route then we will drop our fare straight away. We are the only airline that offers that kind of commitment.
We are the only airline that allows flight changes. This is one of the key issues relating to the non-refundability of our tickets. None of Ryanair's tickets are refundable. The entire price of the ticket is non-refundable, not just the Government or airport taxes. If passengers do not show up, they do not get their money back. A lot of people do not seem to understand that no refund means no refund. However, unlike with every other airline in Europe, up to three hours prior to their departure time, passengers can change the time and date of their flights and change the name on the ticket. So if a passenger's granny has become ill in Mullingar, he or she can call us up to three hours prior to the departure of the flight and change the dates. Passengers can give the ticket to their mammy if they want, and she can then travel in two or three weeks time. There is complete flexibility.
Why is it three hours prior to departure? First, we close the flight for bookings three hours prior to departure because we must download the number of people travelling for check in at the airport. Names cannot be added after that. We will not allow that facility to somebody who has got stuck in traffic, arrives late and then seeks to change a ticket. Thus, tickets are non-refundable but completely changeable.
We deliver on-time performance. We tell passengers the precise reasons for any delay through our online flight information system that is updated every five minutes. We can respond to passengers faster than the high fares airlines, and we have a 100% record of replying within seven days. We provide very prompt refunds. I know somebody will interject that we do not offer refunds, but we do offer refunds in cases where we screw up. If a flight is cancelled because of fog, snow or other weather conditions in a German airport, for example, we will give passengers the option of a refund or a transfer to the nearest available flight. Aside from the death of an immediate relative, those are the only circumstances in which we provide refunds.
The quid pro quo for not having refunds is that we do not over-book flights. One of the issues that bedevils most airlines is the over-booking of flights. They know that 6% or 7% of their passengers will not show up, so they over-book the flight by 5% or 6% to ensure that it will be close to 100% full. A lot of business class fares are fully flexible anyway, and business people will book them and then just not show up or change the flights. We do not do that. We do not allow rich businessmen to change flights. They must buy tickets and change them on the exact same basis as everybody else - by calling us three hours in advance. The upside is that people do not get bumped off Ryanair flights because rich businessmen are paying us money. A person paying a fare of € 1 has the same entitlements as the rich businessman.
We are the only airline to publish our monthly service statistics and we support the EU plan for all airlines to publish them. Funnily enough, none of the high fare airlines in Europe support this. The Association of European Airlines represents all the high fares airlines, but Aer Lingus is the only member that does not declare to the association the statistics on its on-time performance. People can read into that what they may. Ryanair's on-time performance in January was 88%. We have been the number one in Europe in this regard for about the last five years. Yet, we are bedevilled with a reputation in this country for always being late. In fact, we are always early in comparison to everybody else.
We lose less than half of one bag for every 1,000 passengers carried. To put that in context, British Airways loses 26 bags for every 1,000 passengers carried. For every one bag we lose, British Airways loses 50. For every 70 bags that Air France lose, we lose one.
Chairman: Are long-haul flights not a factor in that?
Mr. O'Leary: One factor is that these airlines offer connections. In part, however, they are just not as good as us at handling the baggage and personal belongings of passengers. They do not have the same commitment to customer service that shines through Ryanair.
Chairman: Modest as well.
Mr. O'Leary: We will wait for the modesty when your side gets started, Chairman. The perception is that Ryanair cancels flights at the drop of a hat because it does not have enough passengers to fill a flight. Ryanair has the highest load factor of any airline in the world. Our year-round load factor is 86%. We do not have flights with no passengers on them. The situation probably never arises in an entire year where we can merge two flights together. Even if it did, we still would not do it. In January, we cancelled less than 0.1% of all the flights scheduled to operate. It was the best performance of any airline in Europe. Unfortunately, Aer Lingus does not release its statistics to their own association, but Lufthansa cancels about 3% of flights and British Airways also cancels about 3%.
The Chairman kindly invited me before the committee about a month ago on the back of the Aer Rianta chairman's presentation to the committee. I could not come in at that time because we are up to our goolies at the moment in work. I am trying to convey to the committee what Ryanair is out doing at a time when Irish tourism is in the toilet, there is world recession, war in Iraq and a feeling of doom and gloom. We have just spent about € 6 billion on another 100 new Boeing 737 800-series aircraft. We have bought the ailing, loss making Buzz airline from KLM for € 24 million. We have launched four new routes out of Dublin, seven out of London and opened the eighth base in Milan and the ninth in Stockholm. The 12 Buzz routes to Germany, France and Spain will be re-launched on 1 May.
We are probably certifiably insane for investing so much money, growing so rapidly, opening up new routes and offering lower fares at a time when there is a world recession, a crisis in Iraq and a feeling of doom and gloom all over the place. Aer Rianta would have us believe there is nothing they can do because of the recession and the war in Iraq. There is something the Government and politicians can do - break up the Aer Rianta monopoly. It is holding back rapid tourism growth and huge job creation. For every million passengers who come through an airport, 1,000 jobs are created. Every year for the past five years, we have offered to deliver four million additional passengers. We guarantee it. We have offered to pay a penalty if we fall short of that figure. That would create 4,000 jobs. If we were an American computer company offering 4,000 jobs, the Government would build statues to honour us, name buildings after us and ask what they can do for us to attract us to Ireland. However, because we are Irish, the Government does not seem to want to follow our plan.
Ryanair is Europe's number one low fares carrier. In two years, we will become Europe's largest airline. We succeed because we offer the lower fares that customers want. We have industry-leading customer service delivery and a very high growth rate. Even during an international recession and a war in Iraq, Ryanair is still growing month on month at 40%. This is not a fluke or a temporary phenomenon this year. Our growth rate, year on year, has been 40% for the past nine years. We have 40 new airports all over Europe ready and waiting for us to launch new routes. We have nine other bases ready. Aer Rianta says they will not cut us a deal here. Fine, we have plenty of alternatives, but we would like to do it in this country. They then ask why we want to do it in this country - is it because we want to make a bundle of money here? Yes, of course we do, but I can make a bundle of money elsewhere. Aer Rianta's refusal to cut a deal with us is at the expense of Irish tourism, job creation and the economy.
We have 100 new aircraft due to be delivered to us over the next eight years. We would like to place at least 20 or 30 of those aircraft in this country. Twenty of those aircraft could be based in Dublin and ten in Shannon. There would be no room for American military aircraft in Shannon if we had our way. We would also take Shannon from two million to about four million passengers per year. It would become the gateway to the west, just as Prestwick is now the gateway for tourism in Scotland. What do we get from Aer Rianta? The back of the hand. Lower costs and faster growth continues to deliver outstanding shareholder returns. That is the end of my formal presentation. One issue I would like to deal with is Ryanair's policy of non-refundability.
Chairman: We can come back to that because committee members want to discuss the issue in wider terms first.
Deputy Shortall: Mr. O'Leary has been invited here to talk about the non-refundability issue.
Chairman: He has, but if we take wider questions first, we can then return to that issue specifically.
Deputy Shortall: I would like to hear what Mr. O'Leary has to say on the issue.
Chairman: Okay, he can deal with it at a later stage.
Mr. O'Leary: The issue will come up, so I am happy to deal with it now if somebody wishes to put a question.
Deputy Ellis: Mr. O'Leary wants to get his retaliation in first.
Mr. O'Leary: I am from Westmeath and our footballers never do that. That is why Meath beats us every year. On the screen before you is a sample of our booking page. Some 96% of our passengers make bookings through our Internet site. The example I am displaying is our fare from Dublin to London-----
Deputy O'Flynn: Is that fare available today?
Mr. O'Leary: Yes. Bookings are valid for up to one year from the original date of reservation. All moneys paid are non-refundable. No route changes are permitted. Reservations are changeable up to three hours prior to departure, subject to the payment of £15 sterling, € 25 or the local equivalent change fee per flight sector, per person and/or per name change, plus any difference between the original fare paid and the lowest available fare available at the time of making such a change. Thus, if a passenger bought a fare a month ago for € 1 and wants to travel tomorrow, the only fare still available may be, say, € 149. The passenger must pay the difference between the € 1 and the € 149 if he or she wishes to board that flight. However, if one has booked a € 1 fare, it is still possible to make a change and avail of the € 1 fare in one to three months time as long as it is still available.
Ryanair strongly recommends that all passengers purchase suitable travel insurance. Look further down the booking form to the box marked "Important." Passengers must tick that box before they are allowed to make a booking. It indicates that they have read and accepted all the rules. It states: "I have read and understood Ryanair's terms and conditions and the above fare rules, and I will present a valid passport, driving licence or photo student ID card, as applicable." Failure to prevent such valid proof of identity matching the names on the reservation will result in passengers being refused check-in without refund. The passenger must tick the box and accept these terms and conditions before they are allowed to make the booking. Therefore, all passengers who book a ticket with Ryanair know that if they do not show up, the money is non-refundable.
Let me put that in some context. Historically, airlines around the world have operated a system of competing flexibility. That is designed so that the person who wants flexibility - principally the business person or the company paying for his or her ticket - will buy the business fare, which is fully flexible. The lowest fare between Dublin and London in 1985, before Ryanair started flying, was £130. It had to be booked four weeks in advance and it was non-changeable and non-refundable. I am not sure how much tax was paid. Most airlines still operate on the basis that unless people pay for the full, flexible business class ticket, they cannot change the ticket, the times or anything else. Some of the low fares airlines like Ryanair, easyJet and, increasingly, Aer Lingus, now offer substantially lower fares. The trade off is that the tickets are non-refundable.
It is not just the tax or airport charges that are non-refundable. None of the money is refundable. What is different about Ryanair is that the passenger need not lose either the taxes or airport charges prior to booking. If, for some reason, passengers do not show up, they can change their ticket. They can change the names, destination or anything else. We do that because if a passenger bought a ticket two months ago for, say, a € 9 fare, nobody else can buy that seat. The passenger denies anybody else the opportunity to buy that seat and denies us the opportunity to sell that seat. This is not dissimilar to what happens with concerts in the Point Depot. People can buy their concert ticket three months in advance, but it is then non-refundable. All of the money paid to Ryanair is non-refundable. If passengers do not like this, they can either buy insurance or choose not to fly with us. They are free to seek the nearest competitive fare.
That policy is standard across most airlines internationally. It is also universal amongst the low fares airlines in Europe. The same policy of non-refundability is applied by easyJet, Buzz and Go. The airport charges and taxes are non-refundable. Prior to the recent Aer Rianta presentation to this committee, Aer Lingus applied the same policy, but in the flurry of publicity that attended it subsequently, they changed their mind. They now state that passengers who apply for a refund will get one. I suspect that after-----
Senator Dooley: Does Ryanair pay the money to the State?
Mr. O'Leary: No, we do not pay the money to the State.
Senator Dooley: It is better for Ryanair-----
Chairman: Let Mr. O'Leary finish, and then we can take questions.
Mr. O'Leary: I am almost finished anyway.
Chairman: I thank Mr. O'Leary for his presentation. Just to relieve his paranoia, a lot of people admire what he is doing, including many members of this committee. Ryanair has revolutionised air transport and brought it to people who had never flown before. Long may that continue. There is no anti-Ryanair feeling here.
Mr. O'Leary: There is a "but".
Chairman: That does not necessarily mean that Ryanair is absolved of any comment or criticism. We did have representatives of Aer Rianta before the committee, and they offered their views on Ryanair, Dublin Airport and so on. What exactly would you do, Mr. O'Leary, to change Dublin Airport if you had the opportunity to make it much more competitive?
Mr. O'Leary: What we would do tomorrow morning is provide Ryanair with a site at Dublin Airport. We have offered to build a second terminal on a site that is free to be developed. We would pay for that terminal in its entirety and there would be no cost to the State. We will, to avoid the suspicion that we are only chasing a money making scheme, give the terminal back to the State as long as it is not run by Aer Rianta. We would be happy to give it to Bord Fáilte or whoever the Government wants. We would have a low cost terminal with competing car parks and hotels on a small section of the site at Dublin Airport. This would cost us about € 120 million. That offer has been on the table for the past three years but we still cannot secure a deal.
Chairman: Ryanair would impose no charges for using that facility.
Mr. O'Leary: We would impose a very small charge. The present charge levied by Aer Rianta, which includes passenger and landing fees, is about € 10 per passenger. We would charge about € 1 per passenger at Dublin Airport. We would also offer the facility to Aer Lingus and other airlines. It would not be just a Ryanair terminal. Anybody would be free to use it. It has already been planned and designed to hold 40 aircraft. We would have a maximum of 20 to 25 aircraft there.
In addition, we would deliver an additional four to five million passengers to Dublin Airport, with daily scheduled flights year round to places like Rome, where Aer Lingus currently flies three times per week, Barcelona, Madrid, the south of France, Norway, Sweden and elsewhere. Dublin would be over-run with tourists. Some people might think that it is a bad idea, but we would also achieve this at Shannon. We are the strongest airline marketing operation in Europe. We can transport two to three million passengers per year in and out of this country. All we want is a second terminal at Dublin Airport.
Interestingly, Aer Lingus supports a second terminal, as do most of the newspapers. I have heard no dissenting voices other than Aer Rianta, which is understandable, and the trade unions which represent Aer Rianta employees, which is also understandable. One would expect this. Everybody else supports competition, better service and lower costs. A construction company got planning permission about two years ago to build a competing car park at the end of the runway at Dublin Airport. Despite repeated objections from Aer Rianta, the Irish Aviation Authority approved of it in terms of safety as it did not interfere with the runways. Aer Rianta has spent two years pursuing a legal challenge to prevent a competitive car park being built in Dublin Airport. Meanwhile, the daily rate for car parking was jacked up from € 12 to € 20 by Aer Rianta.
What goes on at Dublin Airport on a daily basis is a scandal. Aer Rianta freely builds in the red zones. It blocks everybody else from doing so. The Kennel Club was built in a red zone, as was a leisure complex. Air France recently moved its office accommodation out of Dublin Airport to Swords because of the increase in rents at Dublin Airport. The politicians in these Houses run this country and preside over a monopoly that behaves-----
Deputy P. Power: Not for long.
Mr. O'Leary: Is the Deputy talking about his elected office or about presiding over the Aer Rianta monopoly? I hope it is the latter.
Deputy P. Power: The latter.
Chairman: On the issue of charges, I cannot agree with Ryanair keeping the benefits of non-refundable taxes, fees and other charges, rather than passing them back to customers, airport authorities or the State. Perhaps this has changed since the attention aroused by our meeting here with Aer Rianta, but easyJet has been refunding passengers through their credit cards. I do not see how Ryanair can take money that is supposed to go to the airport authorities or insurance companies and not credit it back to passengers if they fail to show up for flights. I know it is in the small print, I know the logic and I know that Ryanair has offered great deals and so on, but I do not see how it can take money under a certain heading and not give it back to the people it is supposed to be collecting the money for.
Mr. O'Leary: There is a misunderstanding here. We do not take money - passengers give it to us voluntarily. This could not be any clearer.
Chairman: The same could be said about payment of VAT in a restaurant.
Mr. O'Leary: You seem to believe, Chairman, that it is okay that the air fare paid to us is non-refundable-----
Chairman: I have no problem with that.
Mr. O'Leary: -----but it is a problem that we refuse to refund the airport charges.
Chairman: If I go on the Internet and find that Ryanair is charging a fare of, say, € 43, I will pay a tax of 13.69% on top of that.
Mr. O'Leary: No, the fare quoted includes the 13.69% tax, though the point remains the same. Let me explain something about airport charges. We would fully support a change in the structure, in Ireland or anywhere else in Europe, whereby the airport charges would be levied directly as a tax on the passenger going through an airport. It is not levied as a direct tax. It is levied by each airport on the individual airlines. It is different in the US. A passenger going through New York will pay a charge to the airport authorities, and the total cost of running the airport is spread across all passengers. In Europe and with Aer Rianta, that charge is paid by the airlines. It is a misnomer to suggest that we do not pay this charge to Aer Rianta. We do pay an element of it to Aer Rianta. The landing charge is paid, which makes up about one third of the Aer Rianta element of the charge.
Chairman: If a passenger does not pass through the airport, Ryanair does not hand over the money.
Mr. O'Leary: If a passenger does not go through the airport, we still pay the landing charge on the empty seat. This is one third of the total fee. The other two thirds - the passenger charge - is not a tax. It is a charge.
Chairman: You called it a tax when discussing it.
Mr. O'Leary: No, we call it a charge.
Deputy Glennon: Mr. O'Leary referred to it as a tax on the sample booking form he showed us.
Mr. O'Leary: No, it is referred to as "taxes, fees and charges."
Deputy Glennon: In other words, there are three separate components, one of which is a tax.
Mr. O'Leary: One of which is the UK tax. That is the only tax component in that sum of money. The £5 sterling departure tax in the UK is the only government tax included. The Aer Rianta charge is not a Government tax. It is a direct charge by the airport authority on the airline. Similarly, in Stansted, the charge is levied directly on the airline by the BAA, a private company, not a state owned operation. It is a semantic difference as to whether it is a tax or a charge. Passengers do not care much whether we call these taxes or charges.
Deputy Glennon: The passenger is under the impression that it is a tax.
Mr. O'Leary: No, the passenger is under the impression that the total air fare paid to us will be non-refundable. We have received less than one complaint per thousand passengers, and less than 1% of those relate to the non-refundability of the taxes, fees and charges. It does not arise as an issue of concern to our passengers. We are growing at a rate of 40% year on year, and we have no complaints from passengers about not getting € 5 or whatever back.
Deputy Glennon: What about the non-passengers? These are the people we are talking about.
Mr. O'Leary: We do not get any complaints from them either.
Chairman: You are not justifying taking the money and not giving it back, Mr. O'Leary.
Deputy Naughten: I have a number of questions I would like to ask Mr. O'Leary, but the first is on the issue of fees and charges. We have heard ad nauseam, even today, that Ryanair is critical of the levies it is being charged at Irish airports, whether they are defined as taxes, fees or charges. At the same time, it is also the company that is not refunding these levies. This seems to be a contradiction in Mr. O'Leary's argument. Ryanair is very good at advertising its rates and in exposing the charges included in them. In his presentation, Mr. O'Leary made it clear that taxes and charges are far in excess of the actual cost of the seat. At the same time, however, Ryanair is not prepared to refund those charges.
Mr. O'Leary makes the point about the need for low-cost, more efficient airports if costs are to be reduced and additional passengers are to be brought to Ireland. Perhaps Mr. O'Leary could elaborate on that in the context of Aer Rianta's plans for pier D. Aer Rianta argues that, because the development is specifically targeted at low-cost airlines, it will reduce costs and make the terminal more efficient. Despite this, Ryanair appears to be critical of it.
Will Mr. O'Leary comment on the argument that is often made that bringing a low-cost passenger into a country and a tourism sector of which the Minister for Arts, Sport and Tourism has been critical for their high costs is a contradiction in terms, that both are incompatible? Will Mr. O'Leary dispel that argument or elaborate on it?
Mr. O'Leary was extremely strong in his presentation on the potential of Shannon Airport. The loss of the Frankfurt-Hahn route into Shannon and its transfer to Kerry was a major blow for Shannon, although it was a benefit to Kerry. Mr. O'Leary has stated that there is the potential to develop new routes at Shannon. What type of potential is involved? Does he believe that, if there was independent management, this potential could be developed? The case has been made by Aer Rianta that it gave Ryanair an exceptionally good deal for the past three years on the Frankfurt-Hahn route and offered it a further three years on the route, yet Ryanair transferred the route to Kerry. Will Mr. O'Leary elaborate on that issue?
Aer Rianta has stated it has lost money at its Cork and Shannon operations and will probably make the argument that part of the reason for increasing charges at these airports is because they are losing money and that the only profitable airport the company has is Dublin which it is using to subvent Shannon and Cork to try to attract new routes. Will Mr. O'Leary elaborate on this issue? Is this the case? What is his view and opinion on it? Does he believe redemption is available for Aer Rianta to manage Dublin Airport more efficiently? If he were manager of Dublin, would he conduct matters differently and, if so, how?
Deputy Shortall: I welcome Mr. O'Leary and thank him for his presentation on refunds. We will not charge him for the free advertising. I am glad he took time because he was invited to attend the meeting to discuss his company's policy on refunds.
I had a look at Ryanair's website today and saw for the fare from Dublin to Luton, for example, the heading "taxes" which amounted to € 13.69, and this was broken down. Does Mr. O'Leary accept it is a misnomer to use the word "taxes" because they are not taxes levied by a government and that to use the term is misleading? Of the € 13.69, € 10.92 is PSC. Does that stand for passenger service charge?
Mr. O'Leary: They are the passenger and landing charges. The € 10.92 is the outbound charge at Dublin Airport.
Deputy Shortall: They are airport charges.
Mr. O'Leary: Yes.
Deputy Shortall: There is a € 2.77 insurance levy. Could Mr. O'Leary explain what that involves?
Returning to the passenger service charge, you, Chairman, asked Mr. O'Leary earlier for a breakdown of the charges for the flight in question, for example. Mr. O'Leary indicated that the € 10.92 is the charge at Dublin Airport. Is that the actual charge levied on Ryanair by Aer Rianta? How does Mr. O'Leary's company arrive at the figure?
There is an element of tax involved in the return flight from the United Kingdom in the form of the UK air duty. In the case of countries which have a Government tax on air travel, something which applied in this country until 2000, is it not the case that Ryanair acts as an agent, a tax collector, on behalf of national governments? In that respect, has Ryanair obtained legal advice regarding its responsibilities of passing on the taxes it collects on behalf of the Government or refunding them to passengers where they are not applicable?
Mr. O'Leary was very critical about airport charges. Does he accept that overheads are involved in operating an airport? I heard him on radio discussing his decision on Shannon. He does a great deal of bad-mouthing of Aer Rianta, a company which has its shortcomings. He does not appear to accept that overheads are involved in operating an airport. Does Mr. O'Leary expect airport managers to operate an airport and raise profits on subsidiary activities? Is he opposed to the principle of those using airports, namely, airlines and passengers, contributing to the cost of running the facilities?
In spite of all his bad-mouthing of Aer Rianta and its high charges, does Mr. O'Leary accept the findings of the Paddy Mullarkey report published last week which found that the charges at Dublin Airport are extremely competitive by international standards? If he does, would he also accept the point made by the report that a second independent terminal at the airport will inevitably result in increased charges if it is to give an adequate return on the investment required?
We discussed the issue of unaccompanied minors with Aer Lingus when it was before the committee some time ago. Its representatives spoke of the difficulty in ensuring safety. What is Ryanair's policy and has it encountered the same difficulties as Aer Lingus which is not in a position to guarantee the safety of minor passengers who travel with it?
All of us as public representatives know of frequent instances of elderly people in particular who are due to travel to a funeral the following day and discover the night before that they must have identification in the form of a passport or driving licence, of which they have neither. We have all tried to process passports very quickly in a matter of hours so that such people can travel. Does Mr. O'Leary accept that his company's policy in this regard causes severe inconvenience to many passengers, especially elderly people who may not be familiar with using the Internet and absorbing all its information and who are accustomed to travelling to the UK without the need for a passport? I notice students can use student cards which are accepted as photographic identification. Would Ryanair accept senior citizens' travel passes? That would ease the difficulties for many older passengers. It should be employed to give some flexibility in this regard because the requirement causes considerable hardship.
Chairman: Would Mr. O'Leary like to answer some of those questions?
Mr. O'Leary: I will try to give Deputy Naughten the succinct answer on Aer Rianta. Is it possible for the company to be run better? Where do I start? Let me give an example. Aer Rianta is the Iraq of Irish tourism. It is an inefficient dictatorship-----
Chairman: You are certainly blowing the hell out of it anyway.
Deputy O'Flynn: With all due respect, Chairman, we have never tolerated such remarks from anyone who has made a presentation to the committee. Perhaps you would remind Mr. O'Leary that he should conduct himself in a proper manner in the Houses of the Oireachtas.
Mr. O'Leary: My apologies if I caused the Deputy any offence. Aer Rianta is a monopoly and acts and behaves like one. It builds facilities at Dublin Airport in particular and at Shannon that customer airlines do not want, that are not efficient and does so at an unbelievably high cost. The costs are extraordinary and it is difficult to understand how it could spend that much money. Part of the problem is that there is a regulatory regime in Aer Rianta whereby the company's income is capped at a percentage of its total capital base. The whole purpose or raison d'être of Aer Rianta is to spend as much capital as is humanly possible because the more it spends or the more money it wastes on building infrastructure, the higher its income cap will be for the next couple of years. This is why there are all these crazy ideas.
More recently, the chairman of Aer Rianta announced that it wanted to build an internal railway system at Dublin Airport. They cannot run an airport but now he believes they can run a train system out there. That would cost € 100 million. There is no requirement for it. Nobody needs it or wants it. A second terminal can be built there on the other side of the car park. Aer Rianta supports the building of a rail line from Dublin Airport to the centre of Dublin. No one asked the airlines or the customers if they needed it. The cost, I understand, has gone from € 2.5 billion to € 4 billion. This is an airport that already has 14 million passengers a year. Somehow, unbelievably, 14 million passengers a year manage to make it in and out between Dublin Airport and the centre of Dublin. I know it is difficult at times because the M1 motorway is being extended, but we do not need to spend € 4 billion building something for the next two or three million passengers that come to Dublin Airport.
Can Aer Rianta be run better? Yes, absolutely. How would it be run better?
Deputy Naughten: I wish to elaborate on the regulatory system for charges because a great deal of money is being spent at present on a legal action. Does Mr. O'Leary believe the regulatory system or the structure by which the cap is imposed is a cause of part of this difficulty?
Mr. O'Leary: No, in fairness the regulatory system is much better than allowing the Department of Transport to regulate the company it owns. At least there is some independent voice. At least the regulator came up with a report that said that Aer Rianta does a bad job, that it goldplates the facilities and is overly expensive by international standards. The regulatory system is a better solution.
However, the best solution is competition. Aer Rianta trots out all this stuff about whether it is accepted that there is a cost for the passenger and that the airport has a cost for this, that and the other. I do not accept any of that. Aer Lingus used to come up with the same old trot back in the late 1980s. It said that the average fare to London by international standards was £150, that this was cheap by international standards and everyone knew there was a cost for flying people to London. Miraculously, 15 years later the average cost has fallen by the guts of two thirds. I get a pain in my ear listening to the people in the media in this country trotting on all the time about how everything has gone up since the euro. Nobody bloody mentions the air fares. They are still going down.
Competition results in improved service and lower costs. Nobody would argue that the deregulation of the taxi industry in Dublin in recent months has not at least improved the availability of taxis.
Deputy Ellis: Is that the availability to purchase them? Are they easy to get?
Mr. O'Leary: I speak with some expertise in this.
Deputy Naughten: There is an excellent service to Mullingar.
Mr. O'Leary: It costs me more to get from Mullingar than to fly to London, but that is neither here nor there.
In every sector of this country where we have introduced competition on top of monopolies or regulation, prices have come down and services have increased. What solution have I for Dublin Airport? Let us build a second terminal. If you do not like Ryanair, let someone build a second one, but please do not waste another five years, which is what the wise men's committee said it would take. We could have it built within 18 months. There is a site and we have offered to pay for it. We will design, develop and build the terminal. What the hell is going to take five years? The first ten months of this are planning, consideration and consultation. We are so busy bloody consulting nobody bothers doing anything.
The other point, pier D, is a classic in terms of Aer Rianta. We originally designed pier D with Aer Rianta about five years ago. It would have 14 gates on it, these being where aircraft are parked. It would cost € 11 million. It was jointly costed between ourselves and Aer Rianta. Had they pushed it, we would have built it within five months. Aer Rianta no longer wants to build that simple facility. It has come up with all sorts of specious nonsense - security this and immigration that and so on - and now does not want it. What it has now proposed is a new marble palace which will be a low-cost facility but, instead of costing € 11 million, will cost something in the order of € 80 million. Remarkably, it has been relocated so that it does not fit where the existing A pier is. It has been moved north so that it is on exactly the same site as where the second terminal is proposed to be built.
Ryanair opposes the building of an € 80 million terminal as a low-cost development because it is not low-cost. The chief executive of Aer Lingus, who as I am sure the committee is aware is no great fan or friend of Ryanair, has also said that the costs are unjustified and that it is ridiculous. This amount of money should not be wasted. What Aer Rianta has proposed with the new pier D, not to be confused with the original low-cost pier D, is simply a means of preventing Government policy outlined in the general election to develop a second terminal or a low-cost pier D. Aer Rianta simply designed something that would cost € 80 million and that would ultimately block a second terminal. We oppose that, as do all other users of Dublin Airport.
On the issue of low-cost passengers into a high cost country, there is an awful lot of old nonsense talked in this country about it being high cost. Yes, it is not cheap. We are no longer Albania or Poland. We go baggage handling at the airport once a month in the summer and I never cease to be amazed by the numbers of people who fly in here on € 29 and € 39 tickets with golf bags the size of cruise missiles and green fee applications for the K Club, Mount Juliet and all these places where the green fees are € 130 to € 150. Members would be amazed at the number of passengers who fly in on Ryanair at € 19 and € 29 to stay in the Tara Towers, the Berkeley Court and all the other five star hotels whose names I cannot remember.
For the rugby match next weekend we are inundated with people who never fly Ryanair except once every two years. We get a surge of complaints the week after the home international against England with fellows writing in: "My good man, I have flown around the world for the last 40 years and I have never been charged for a gin and tonic in my life. I am never flying your appalling, grubby little airline ever again". We write back to him saying: "Dear Sir, you paid £19. If you ever get a £19 air fare on Aer Lingus or British Airways, then I promise you we will give you free flights for life".
The key thing here is access. I have no doubt about the ability of the tourism industry in this country to respond. There is an awful lot of nonsense talked or revisionism going on about the 1980s. Which came first in Irish tourism? Was it U2 and Temple Bar or did the tourists all start coming here in the mid 1980s because we had Guinness, nice personalities, were grand crack and it was a grand place for a stag party and all the rest of it? This place was like Albania in 1985. The only two cities that British Airways did not fly to in 1985 were Tirhana in Albania and Dublin. It was expensive to get to and nobody wanted to bloody come here. Jim Mitchell at the time and subsequent Ministers revolutionised it by introducing, partly by accident, competition to Aer Lingus. Access costs came down. No longer did people have to come here on bloody boats. They could fly here from points all over the UK.
We can do this again from Europe, so that instead of just getting stag parties from Leeds, Bradford, Sheffield or Bristol, we will bring in people from France, Spain and Italy. They are dying to come to Ireland. I have a pain in my ear going around to all these airports saying we will fly to them from London, Frankfurt, Milan and so on. They say: "We would really love, Monsieur, a route to Dublin or Shannon". We must reply: "Sorry, the Irish Government won't allow us". They are mystified until we explain afterwards the subtlety that the Irish Government, through its airports, wants to screw us for every passenger we bring here. They understand then. We believe the way of fixing tourism in this country is low-cost access. We can revolutionise tourism in this country by having the same low-cost access from continental Europe as we have from the UK.
It was said that Frankfurt-Hahn would be a big loss for Shannon. I could not agree more, yet the only people who have cost it that route are Shannon Airport. We wrote to Aer Rianta Shannon on 10 February and said the only thing it had to do to retain the daily low fare service into Shannon was to agree an extension to the existing cost base, which was free. There was a three year deal for free. They wanted to jack it up from being free to about € 6 a passenger. Everyone says: "Isn't that reasonable? Aren't they entitled to € 6 a passenger?". No, they are not when many other airports around Europe are equally competing for that service at zero and will provide us with low cost. The only reason the service is gone from Shannon is because Aer Rianta wanted to put up the charges. Had it been sensible and acted in the interests of Shannon, it might have kept the head down for the year because there was a recession and a war in Iraq and the last bloody thing it wanted to do was lose a route. It could have given us a year's extension and fought about it next year. Instead, Aer Rianta offered us a three year deal which was a discount of 60% in the first year, which would mean we would pay € 4 per passenger, 50% in the second year which would mean we would pay € 5 and 40% in the third year which would mean we would pay € 6.
We are not flying to airports that increase charges. I do not care if they are Shannon, Dublin or Stansted as long as there are many other airports where the costs are lower. Why do we do this? We are trying to lower costs for consumers. We want to reduce the cost of air travel. We are not bloody geniuses. We cannot drive down air fares and subsidise inefficient, high cost airports in the west of Ireland. That is why Shannon lost the route.
Chairman: The charges in Stansted are higher than in Dublin.
Mr. O'Leary: They are not higher than Dublin. They are lower.
Chairman: How come it is € 18.94 coming back and € 13.69 going out?
Mr. O'Leary: The split of the € 18.94 represents principally the UK air duty, which is € 7.35, the insurance duty, which is € 2.77, and the airport landing and passenger charges, which are € 8.82. In Dublin they are € 10.92 and the insurance is € 2.77.
Chairman: Yes, but it is a tax and an airport charge. The passenger does not give a damn to whom he pays the money.
Mr. O'Leary: The alternative was not a choice of flying in and out of Shannon or Stansted. The choice for an aircraft based in Frankfurt was whether it went to Shannon or some other airport in Europe where the charges were significantly lower than Shannon proposed. Shannon got the route for the past three years because its charges were lower than the charges the other European airports were offering us. It is a competitive environment.
Chairman: I know it is a competitive environment but it seems to apply to some places and not to others.
Mr. O'Leary: No, it does not.
Chairman: You talk about how great Stansted is, yet the charges for a passenger are more than they are for Dublin.
Mr. O'Leary: I never said that Stansted is a great place. It does not arise, but we have lower cost alternatives to Shannon for an aircraft based in Frankfurt.
Let me tell members why this is really bizarre. If one examines Aer Rianta's accounts and splits its revenues, last year and in 2001, it had total traffic of 18.5 million passengers. Of the company's total revenues, € 100 million was aeronautical revenue, that is coming from airlines in the form of passenger charges and landing fees. Some € 300 million came from commercial revenue, such as car parks, restaurants and shops. For every € 1 Aer Rianta got from an airline, it got € 3 from passengers. This is partly the answer to Deputy Shortall's questions. Why would airports allow an airline to fly to them for free? It is because they get more out of passengers in car parking, restaurant and shop fees and concessions.
Deputy P. Power: Is the logical follow-on from that that they ought in some circumstances to pay Ryanair to fly to their airports?
Mr. O'Leary: That is a revolutionary and visionary strategy. I recommend the committee go forward with it.
Deputy P. Power: It is a serious question.
Mr. O'Leary: I am being serious. It is an open fact that some airports pay us to fly there and that they are profitable. They are privately owned. People do not do this because they are Government subsidised. They are privately owned and pay us to fly there. Why? It is because they get € 3 per passenger on every one coming through.
Deputy Killeen will be interested in what I have to say next. Shannon Airport-----
Deputy Naughten: It is Deputy Breen.
Mr. O'Leary: My apologies, I thought it was Deputy Killeen. It was the Saddam-like moustache that confused me.
Shannon Airport from a business perspective this year had a decision. Ryanair, which it may or may not have liked but delivered 100,000 passengers a year, was not paying it anything for bringing those passengers through this new route from Germany. However, it was getting € 3 a skull out of them for the car parking and shops. It had to decide whether to whack up the charge to € 6 per passenger this year with a recession in train and with the chance that it would lose the route if it did or hang on to the € 3. What happened was that it put up the charges and lost the route. Not only did it lose the € 1 in aeronautical charges, it also lost the € 3 in commercial revenues as well. Only a Government owned monopoly would think like this.
We are in the middle of a war on Iraq. Our fares are dumped down on the floor. We are charging fares of € 1, € 5 and € 9, yet taxes, charges and fees are € 12 and € 13 on top of that, but that is what I have to do. The point was made that this fare is higher than my costs. It is not, it is much lower than my costs. I am losing money on a shed load of seats I am selling at the moment, but at least I am selling the seats. I have a chance of selling people a sandwich or a drink on board and that one in six will rent a car or take a hotel room. I will make money out of that stuff. Aer Rianta must do the same.
Seán Barrett, a leading transport economist, has made the point that airports are pretty much like shopping centres. Shopping centres will do a deal with Dunnes Stores or Marks and Spencer to be the anchor tenant because they will hoover in lots of people. Then the centres get higher charges from all the other tenants. Why does Aer Rianta not act on a similar basis? I hope that answers the question on Aer Rianta.
On Deputy Shortall's query about whether the € 10.92 is the actual charge levied by Aer Rianta, in some cases that is not the actual charge in Dublin Airport.
Deputy Shortall: How does Ryanair arrive at that figure?
Mr. O'Leary: It is the formal charge, which is the passenger charge and an approximation of the landing charge. The passenger charge is about € 7.50 and the landing charge equates to about € 3.50. I may have got these figures slightly wrong, but they amount to € 11, which is about right.
Deputy Shortall: Both are paid to Aer Rianta in the case of Dublin Airport.
Mr. O'Leary: Correct, or not paid, as the case may be, in the case of the passenger charge if the passenger does not travel. The landing charge will still be paid, even on an aircraft coming in with empty seats.
Deputy Shortall: The answer to the Chairman's question then is that these are the actual charges.
Mr. O'Leary: No, these are the actual charges levied by Aer Rianta on about 80% to 90% of our traffic. There are still the remnants of rebate schemes for old growth on new routes that are working their way out of the system. I think we are in the last year of a growth discount scheme on Paris and Brussels, so we would get a discount at the end of the year from Aer Rianta on those that would notionally reduce those charges from € 10.92 to about € 8.50 at the end of the year. There is no way of approximating which passengers attract rebates and which do not, so we just charge whatever it is on all passengers.
Where it is easy to identify is the Frankfurt to Shannon route at present, for example. If one makes a booking on that route, which is free, the PSC on the route out of Shannon is zero, although there is an arrival charge in Frankfurt levied by the airport. The charges are not always the exact amount of money levied because it is not possible in advance to assess the exact amount. However, it is a pretty close approximation except in some cases around Europe where we have very low cost arrangements or where airports pay us. In such cases, we will not for reasons of confidentiality specify exactly, so we put in the approximation of an airport charge.
Deputy Shortall: Is Mr. O'Leary saying there are no "taxes", as his company terms it, on tickets from Shannon to Frankfurt?
Mr. O'Leary: There are no Aer Rianta taxes or charges on the tickets from Shannon to Frankfurt.
Chairman: There is insurance.
Mr. O'Leary: There is an insurance levy.
A Member: There is a landing charge.
Deputy Shortall: Can I ask Mr. O'Leary-----
Mr. O'Leary: No, there is not. The new route scheme in Shannon that applied on the Frankfurt route for the last three years is zero landing and passenger charges. It also applies on the Brussels route where we are in the third year and on the Paris route where we are in the second year. Shannon Airport is also facing the loss of the Brussels and Paris routes in the next two years as well if it follows the same suicidal policy of jacking up the charges from zero to € 6 a passenger.
Deputy Shortall: Is Mr. O'Leary saying that what he terms "PSC" is paid over to airport authorities?
Mr. O'Leary: Where?
Deputy Shortall: Wherever his company goes.
Mr. O'Leary: If the passenger does not fly, we do not pay the passenger charge. It depends on what-----
Deputy Shortall: Okay, but what about when the passenger flies? Is Mr. O'Leary saying-----
Mr. O'Leary: Where the passenger flies at Dublin Airport we pay on the London route, where there is no element of a discount at all during the year, the full € 13.69 or whatever it is going to be.
Deputy Shortall: Can Mr. O'Leary explain what the insurance levy entails?
Mr. O'Leary: The insurance levy is a special charge that was levied by all the insurance companies on all airlines immediately following 11 September. To recoup or pay off the damages arising from the two airline accidents, all passengers around the world on all airlines pay an insurance levy. Our levy represents the approximation of what we actually pay to the insurance company. It is one of the lowest in Europe. Aer Lingus's is higher and Lufthansa, for example, charge about € 6.
Deputy Shortall: Okay. What about the actual taxes the company collects?
Mr. O'Leary: There is no actual tax in the € 13.69 out of Dublin on a-----
Deputy Shortall: What about in the case of UK airports?
Mr. O'Leary: In UK airports, if you take the € 18.94 ex-Stansted, € 8.82 comprises airport charges, € 2.77 comprises the insurance levy and € 7.35 comprises the UK Government tax, which is the £5 government departure tax.
Deputy Shortall: Is that tax you collect on behalf of the British Government?
Mr. O'Leary: Yes, that is tax we collect on behalf of the British Government.
Deputy Shortall: What is your legal advice in respect of your company holding on to the taxes that applied here up to 2000.
Mr. O'Leary: The Deputy is using the language incorrectly. They are not taxes here, they are airport charges.
Deputy Shortall: I know that. I am talking about up to 2000, when they were taxes.
Mr. O'Leary: We have no legal advice on the matter. What we used to do, until two years ago when we fell into line with everyone else, was that we offered a refund of the UK £5 sterling which was subject to a refund administration charge of £5. In other words one was not getting the refund. In the real world we run a low cost operation. We are not setting up a refunds department. People who have bought a non-refundable------
Deputy Shortall: I accept Mr. O'Leary is not setting up a refunds department. I am asking about the legality of holding on to taxes collected on behalf of a national government.
Mr. O'Leary: Nobody has yet pointed out that it is illegal. If someone points out that it is illegal we will happily change the procedure to comply with the law. It is the same procedure that is followed by most of the other airlines, not that that is our defence. Our defence is that it is agreed to by every passenger, prior to booking. Everybody understands the meaning of "all the moneys are non-refundable".
Chairman: Can you give an estimate of what you make on "no shows"?
Mr. O'Leary: "No shows" is a misnomer. Aer Rianta got the figures wrong, not for the first time. To put this in broad terms, our total "no show" in a year is about 900,000 passengers, that is one-way passengers, on an average fare of € 43, which is non-refundable; the amount would be of the order of € 35 - € 40 million per year.
Chairman: But what is the figure for charges?
Mr. O'Leary: That includes charges. The charge would be included in the average fare. That is the total.
Deputy Ellis: We are talking about € 10 million. Some € 8 million to € 10 million would be the amount for landing charges in that figure.
Mr. O'Leary: No, the figure would be less. In terms of the airport charges at Dublin, the average airport charge across the system is € 5.33.
Deputy Ellis: That would be € 4.5 million.
Mr. O'Leary: That would be € 4.5 million. In actual fact the figure is € 45 million because what is non-refundable to "no-show" passengers is the entire fare. We do not separate out the taxes, we keep the whole lot if there is a "no show". I should, perhaps, put that in context. In the case of Aer Lingus - it will answer for itself - most of its fares are non-refundable. It would have a higher "no show" ratio but the average fare is € 150. It would keep in the order of € 150 x 10% of six million passengers which amounts to € 60 million.
Chairman: I do not think there is any problem with not returning the money to those who bought a ticket but people are concerned about the charges.
Mr. O'Leary: That is the split. We are not acting as agents on behalf of the Government, certainly not in this country.
Deputy Shortall: What about the British Government?
Mr. O'Leary: The Deputy may have an argument that we are acting on behalf of the British Government. The British Government has yet to tell us - and the other airlines - that we are doing something unlawful. If they do we will happily comply with the law, whatever it is. We support and fully endorse the general thrust of the wise men's committee report which says that a second terminal competition would be good. Our approach is to get on and build it. There are, however, many inaccuracies in the report. One is that Aer Rianta's charges are low by international standards. They are not. Aer Rianta airports are the most expensive at which we fly. In respect of its own figures, which were wrong, the chairman of Aer Rianta said the charge was € 30 on a return ticket. On our one-way ticket we pay about € 10 or € 11 to Dublin Airport. In an era when we are charging an average fare of € 45 I fail to understand why more than 20% of it should go to Dublin Airport when Dublin Airport gets three times the revenue from car parking and other charges as it does from the airlines.
Dublin Airport could easily operate and not charge the airlines and still be profitable. One can argue that it would be more profitable than at present if it was run properly. The second terminal will result in increased charges. I have read the report twice and I still cannot work out where it got the idea that a second terminal would result in increased charges, because the report does not say it. It may have misunderstood it. One of the regrettable things about the wise men's committee is that it refused to meet us or anybody else who had made a submission to build the terminal. These wise men were sitting in a darkened room talking to Aer Rianta but with none of the people who wanted to build. In order that Aer Rianta will understand it again, let me repeat it. We have offered to build this terminal. We have offered to pay for it and to give it back to the Government. It is inconceivable that Aer Rianta's costs would increase as a result of somebody else building a terminal free for it. It is inconceivable that charges would increase. It is wrong. It has never happened in the history of competition, since Adam Smith wrote the "Wealth of Nations" in 1778. Competition reduces costs and prices. The best example of that in Ireland is Aer Lingus, which has been transformed in the past 12 months by following exactly what we were doing five and ten years ago.
Deputy Shortall: Presumably it was not considering a benevolent benefactor like Mr. O'Leary coming in and building it.
Mr. O'Leary: I cannot understand how it did not consider a benevolent benefactor like me. We had made the submission.
Deputy Shortall: If it looked at the reality of who was offering, apart from Mr. O'Leary, Aer Lingus maintains that in order to get an adequate return on the investment involved the charges would increase.
Mr. O'Leary: The investment would be zero.
Deputy Shortall: Leaving aside his own case, does Mr. O'Leary accept in principle that is the case in relation to Dublin Airport?
Mr. O'Leary: No, it is fundamentally wrong. If we offer to build the terminal for nothing the investment is zero. There is no possibility of costs rising at Dublin Airport as a result of some moron from Mullingar offering to build a terminal for free for the Government. It is impossible.
Deputy Shortall: In the other cases where people have expressed an interest - apart from yourself - does Mr. O'Leary accept that the investment required would result in increased charges?
Mr. O'Leary: To be perfectly honest, we do not have any notion of what was planned or proposals made by others. As far as I am aware - this may not be accurate because I have no access to the information - they got 13 expressions of interest but about 11 consisted of a three line letter stating, "We hereby express an interest in building a terminal at Dublin Airport". We submitted a model, a plan, a design, a costing of the location, a consortium of members and so on. I understand the McEvaddy's made a comprehensive submission also. Why are we having committees of wise men? Why did the Government not say to Ryanair-----
Deputy Shortall: As Mr. O'Leary said earlier, business people are in business to make money.
Mr. O'Leary: Yes.
Deputy Shortall: People are not going to invest in the airport unless they can make money out of it.
Mr. O'Leary: Correct.
Deputy Shortall: That will result in increased charges.
Mr. O'Leary: No, it will not.
Deputy Shortall: This year Aer Lingus-----
Chairman: Sorry, Deputy, we are going around in circles. Mr. O'Leary explained that he gets € 3 for every € 1 he is paying the airlines. That is how one makes money on an airport.
Deputy Shortall: He is also saying that they should reduce charges for car parking and everything else. If the charges are reduced for everything else-----
Chairman: Sorry, I call Deputy Power.
Deputy P. Power: I am concerned like many of my colleagues on the Government side that we have heard only from Fine Gael and Labour and there are five or six people here.
Deputy Shortall: With all due respect-----
Chairman: I know others want to speak.
Mr. O'Leary: I will stay here all evening. There is no time pressure.
Deputy Shortall: We are not staying here all evening but, Chairman, if questions are asked they should be answered.
Deputy P. Power: The last time the joint committee held a meeting with the chief executive of a national airline was with Willie Walsh. I made the point that Willie Walsh was speaking exactly the same language as Mr. Michael O'Leary of Ryanair but I wish unreservedly to withdraw those remarks as he is in a completely different ballpark from Mr. O'Leary in terms of the aviation industry. I agree substantially with Mr. O'Leary's views in relation to the market forces and the dynamics which drive the airline industry. That cannot be disputed and the profits, profitability and capitalisation of his company underpin that fact. I put it to Mr. O'Leary, bearing in mind what I have said, that he is now the new monopoly in terms of airlines. In regard to my local airport, Shannon Airport, is it true that he is now in such a massive bargaining position, in terms of competitive airlines, that he is able to dictate the terms to airports? I would be interested to hear his views on that matter. Relatively speaking, what does Farranfore, Kerry, charge for the Frankfurt route?
Mr. O'Leary said that Willie Walsh would not be a fan of Ryanair but he made the point here recently that he was in negotiation with Ryanair on facilities in Dublin Airport. I would be interested to hear Mr. O'Leary's views on that. Can he confirm to the committee that Ryanair and Aer Lingus are working in tandem in respect of facilities at Dublin Airport?
In terms of public policy, what are Mr. O'Leary's views on the separation of Aer Rianta, specifically as it relates to Shannon? What new managerial and/or corporate structure should be put in place in so far as it relates to Shannon to accommodate the type of airline he represents and other low cost airlines? Also, I am interested to know the current market capitalisation for Ryanair.
We asked Mr. O'Leary to come in to talk about fares. I accept his point that when the customer ticks the box on the form they accept what he calls the fair rules outlined at the top. My only disagreement is whether they are fair, although I accept the legality of the position. Is Ryanair the new monopoly?
Deputy Ellis: I will try to be as brief as possible. How will the loss of the Frankfurt route and the possible loss of the Paris and the other route from Shannon in the next three years affect Aer Rianta? I am talking about the loss of revenue to the airport, excluding Ryanair's landing charges because Ryanair is not charged for landing. Also, Mr. O'Leary talked about regional airports. Has he considered using Knock as a hub for flights to Europe and perhaps Aldergrove, which we heard at another forum yesterday is crying out for business to survive? Has Ryanair ever examined the possibility of providing its own airport somewhere in the midlands? There is a suggestion that there should be an airport in the midlands-----
Mr. O'Leary: Not in my back yard.
Deputy Ellis: -----and that Ryanair looked-----
Senator Dooley: Deputy Ellis has a site in Leitrim.
Deputy Ellis: No, Mullingar is quite central. That might be a way of solving Ryanair's other problems. Could Baldonnel be considered as a possible second airport to create competition in Dublin?
Mr. O'Leary: I will try to speed up the answers. To answer Deputy Power, we are a monopolist because we are able to dictate terms to airports. If we were able to dictate terms to Shannon, we would not have moved to Kerry. We are not able to dictate terms to Shannon. We move around based on whoever comes up with the lowest cost.
Deputy P. Power: Is Ryanair being charged more in Kerry than in Shannon?
Mr. O'Leary: No. We are being charged less in Kerry, and that is on the record. I will not say by how much because the cute Kerry boys do not want me to tell the committee. This is a PLC company. We go where the costs are lowest and where we can maximise the profit, and I make no apology for that. Wherever we maximise the profit we can offer the lowest fares. Kerry got the deal because their charges were much lower than Shannon's. For the past three years when it was free, Shannon had the traffic.
Deputy P. Power: If their charges are lower, ipso facto they are paying Ryanair. Is that correct?
Mr. O'Leary: No. They are charging lower costs because Shannon wanted to go from nil to € 6 a skull starting this year, so it is less than € 6 a skull.
Deputy P. Breen: Are they giving Ryanair money to market Farranfore?
Mr. O'Leary: It depends on the Deputy's definition of "giving us money to market Farranfore". Some would argue about a discount that is lower than € 6 being fair, which is what Aer Rianta does. It dresses up a discount and tells us they gave us millions in marketing money, but they did not. They just came up with a low cost base. The answer to the question as to whether we are receiving money from Kerry is "no". They are not giving us significant discounts - the discounts are wholly insignificant and entirely insubstantial given the huge revolution in tourism in Kerry we will bring about this year.
On the question as to whether we are in bed with Aer Lingus at Dublin Airport, the only area where we are in negotiations with Aer Lingus is in relation to our proposal for the competing second terminal at Dublin Airport. We made a presentation to Aer Lingus and assured it that if the airport gets built, it can have the facility on the same terms as Ryanair. We were not trying to do this as a private terminal for Ryanair, which is one of the major complaints against us. The terminal will accommodate Ryanair and any other airline which wants to use it, including Aer Lingus. We are not in talks with Aer Lingus on anything else.
On the second terminal, we hope Aer Lingus would come on board the consortium to build a second terminal simply because it takes away from Aer Rianta's argument for blocking it. The Department would not be able to block it either because it would be supported by Ryanair, Aer Lingus, the tourism hotel federation and everybody else. That is the only area on which we are in discussions with Aer Lingus.
On the question of management at Shannon, to be manager of Shannon and Cork Airports must be the two most difficult jobs in the country because they are told what to do by the guys in Dublin. They cannot do anything without getting it cleared through Dublin. In the good old days when Liam Skelly used to run Shannon and Barry Roche ran Cork, they were run as independent republics. They used not tell Dublin what was going on. Those were the good old days when the airports were growing and doing something-----
Deputy P. Power: What would Mr. O'Leary recommend as a corporate structure for Shannon in the light of the revision of bilateral agreements with the United States and the problems associated with that.
Mr. O'Leary: Forget the US. The transatlantic stopover is gone and the sooner Shannon gets over it and gets on with life, the better. The future for Shannon Airport is as a gateway for tourism into the west. We should forget the Americans: they are gone. In terms of my structure, I would take responsibility for Cork and Shannon airports from Aer Rianta. I would ensure they were free starting off and would give management responsibility to whatever local structure was in place, be it SFADCo or some other publicly owned bodies in Cork, either Bord Fáilte, the new Irish Tourism Board, or whatever. I would challenge that management every year by saying they will get the sack if they do not increase the traffic at Shannon or Cork airports this year by 20%, and if they increased by 20% I would give them a € 100,000 bonus. I would have only one meeting with them a year. That is all that has to be done.
I will give a bizarre example of what happened at Shannon. When Shannon Airport told us it was whacking up the charges on the route to Frankfurt, being clever people we offered it to Cork because it would be a new route for Cork airport and we would qualify for the three year new route discount at Cork airport. Without wishing to compromise anybody, the people locally in Cork said they would love to have it but they would have to run the proposal through Dublin. The letter, which was written in Dublin and faxed from Dublin for the boys in Cork to sign, was to the effect that this would not be a new route at Cork because it would be simply a transfer of business from Shannon to Cork and therefore it could not be done. Not alone did Shannon lose it, they were determined to make sure that Cork could not have it either and it finished up in Kerry. I hold no grudge against the people who run Shannon or Cork Airports. They do a good job but their hands are tied behind their backs because they are told what to do all the time by the "Saddam Hussein" in Dublin. They have no possibility of running those airports in the interests of their communities, as they should be allowed do.
I am ashamed to say I do not know the current market capitalisation of Ryanair. The last time I looked it was about € 4 billion but it is going up and down frequently given the situation in Iraq. I know some terms to describe that but they might not be parliamentary.
Are Ryanair's fares fair? Yes. There is only one test and that is whether consumers support what we do. We are usually the first to come forward with a new policy. We are not taking unaccompanied minors because we cannot handle them. We do not give back refunds or taxes. On the photo identification, we are sorry for the old people who do not have a passport, although it only applies between Ireland and the United Kingdom, but our handling people at Stansted Airport are in an impossible position. We cannot include old age pension books as a form of identification when we are dealing with 16 different countries coming through Stansted. The handling people on the ground simply cannot handle it. It has to be very simple, which is the reason we require a passport, driving licence or the international student card. We do not want the university card or the Blockbuster video card. It has to be the student identity card that we all had when we travelled around Europe. The reason it is restrictive is so the handling people in Stansted and the bigger airports can manage the system.
The test of something being fair is whether consumers support it. We have the support of many consumers. We will take all the brickbats we get from the press or anybody else because the competition does not like us. The acid test will be tomorrow when passenger traffic will be up by 40% on the previous month.
In reply to Deputy Ellis's point on the loss to Aer Rianta of 100,000 passengers from Frankfurt, taking Aer Rianta's own accounts, it will lose € 3 per passenger which amounts to € 300,000 in commercial revenue next year. It will lose € 100,000 notionally in aeronautical charges. That is bizarre. It makes no sense. This airport is looking down the barrel of losing the transatlantic stopover. That is going, no matter how it tries to keep it.
Shannon has an incredible future as the gateway to the west. The argument can be made that in Dublin we have enough tourists, although we need a few more. The roads have been improved, the M1 motorway will be built and it will be fairly easy to get in and out of Dublin. The great feature of European tourists is that most of them do not want to go to Temple Bar; they want to go to the west. That is the draw for the Germans, Italians and French. The Government is working to address regional imbalance through the spatial strategy. It should use that strategy. It should not mind about the corridor to Mullingar, although if a bus lane was provided on that route I would be grateful. If the Government wants to develop its spatial strategy, it should fly the buggers straight to Shannon, right into the west. They would hire cars and fill the pubs.
Chairman: Mr. O'Leary's language is unparliamentary.
Mr. O'Leary: Sorry, what did I say?
Chairman: You used the word "buggers".
Mr. O'Leary: That is a term of endearment in Mullingar. With regard to considering developing our operation at Knock, we will continue to consider it, but the difficulty with it is that it is not a place where we could base aircraft. To base aircraft one needs good weather and to be able to get an aircraft out early in the morning and back in late in the evening. The weather in Knock is bad. Leeds-Bradford is another airport where we cannot base an aircraft. The weather is poor there. We can get in and out of Knock pretty regularly with mid-morning and mid-afternoon flights. We would never get in and out of it early in the morning or late at night.
With regard to whether Knock is a possible access point for low fare services to the west, it is absolutely and I have no difficulty with that. With regard to whether we would want to own an airport in the midlands, we would not for the same weather reason. The midlands is bedevilled with fog. I know that because I drive from there early in the morning and return late in the evening. For some reason Mullingar always seems to get fog.
There was a proposal to build an airport in Abbeyshrule and various other places. Ireland has a population of 3.5 million people and it has 11 airports and four airlines. Bristol has a population of 10 million people within a catchment area of one hour of that city, yet it has only one airport and no airlines. We are over supplied with airports here. We can develop Dublin, Shannon, Cork and Knock. That would put everybody here within one hour access of an airport. There is no great future in developing the airports in Donegal, Sligo and Waterford. They are too small and the country cannot support them.
Deputy Ellis: What about Aldergrove?
Mr. O'Leary: We are in active discussions and I suspect Aldergrove is high up there as one of our next base airports. That would be bizarre, in that we would be flying low fare services directly into Europe from Belfast, but we cannot do that from Dublin.
Deputy Ellis: That would also serve the northern half of the country. From where I live there is a difference of only five miles in my road journey to Dublin and Belfast.
Mr. O'Leary: Leitrim is always foremost in our minds as we develop new bases.
Deputy O'Flynn: Is Ryanair moving its headquarters to somewhere in Europe given that its passenger gain is in Europe, in Stansted and other parts of Europe? Rumour has it that it is moving its headquarters.
Did Ryanair receive more than € 50 million in rebates and discounts from Aer Rianta over the past 18 years? What is its relationship with Aer Rianta in Cork? How many passengers did the airline carry out of Cork last year? How many flights, and to what destinations, does it operate out of Cork? I only mention Cork because I know a little about the airport and I thank Mr. O'Leary for what he said about it. If Ryanair were to introduce a new service from Cork to Scandinavia, Italy or Spain, it is true that it would get a five year deal from Aer Rianta, whereby passenger fees would be free the first year, there would be an 80% rebate in year two, a 60% rebate in year three, a 40% rebate in year four, a 20% rebate in year five and thereafter the company would pay its full passenger fees? Will Mr. O'Leary comment on that?
Deputy P. Breen: I am delighted that Shannon dominated the headlines in the Oireachtas last week and is dominating this debate today. As a public representative for Clare, I have been a frequent traveller with Ryanair. I have travelled through all its hubs in Europe. I am a little disappointed that Mr. O'Leary has compared Shannon with Frankfurt-Hahn because there is a difference. I found it difficult to find Frankfurt-Hahn on a number of occasions because the directions to it were not good, but I understand that is improving.
Many of the questions I intended to ask, particularly on the loss of approximately 85,000 passengers on the Shannon to Frankfurt-Hahn route, have been asked. Given that Ryanair is maintaining a one day a week service on the Shannon to Frankfurt-Hahn route, is it keeping its options open in the event of a management change at Shannon Airport, in other words, if there was a board appointed with its own autonomy and authority? Mr. O'Leary praised Shannon a number of times this afternoon. Would Ryanair be prepared to open new routes out of Shannon? I agree with Mr. O'Leary that Shannon is the gateway to the west. As my party's spokesperson on Shannon Airport, I have been trying to drive that home in recent months.
I am aware that Ryanair's passenger load on routes to Charleroi, Paris-Beauvais and Stansted have been quite good. The marquee type check-in in Paris-Beauvais was quite wet on the day I was there because water was leaking from the roof. I hope Mr. O'Leary will attend to that.
I presume the new boards of Shannon Airport and Cork Airport will be announced in the near future. Will Mr. O'Leary have immediate discussions with those new boards particularly in relation to the existing three routes Ryanair operates out of them? The people of the mid-west value Ryanair's service to Shannon, as do I. Will Mr. O'Leary use the same tactics that he has used when the free landing arrangements for flights to Brussels and Paris end?
I used to make a number of group bookings with Ryanair before I became a Deputy. If one wants to make a group booking three months in advance, one must do so on the web, which presents a difficulty for passengers. Will Mr. O'Leary change that policy?
On a lighter note, as the company is so successful, would Ryanair consider operating an internal flight between Shannon and Dublin, which has proved to be difficult for other airlines in the past? Mr. O'Leary has proven that people will go anywhere if the price is right.
Senator Morrissey: I thank Mr. O'Leary for being such an advocate of the dirty words "private enterprise" and "profit motive". I am not that concerned about the taxes, charges and levies because people have voted with their feet already. If Dublin Airport is to grow to the extent that Mr. O'Leary envisages, with passenger numbers, increased flights and another terminal, the greatest problem will be how one gets from the city to the airport. Mr. O'Leary briefly referred to this point in one of his replies. I would like him to expand on that in the context of other airports into which Ryanair fly. Do passengers access them by metro, light rail, heavy rail or by bus, taxi or private car? Mr. O'Leary's plan is to have in place another car park which would compete with Aer Rianta's, but that would seem to be against Government policy in that more people would be travelling by car to the airport. The Minister is on record as having his eye on having access to a metro in the airport. What does Mr. O'Leary consider would be the best benefit to his customers who at the end of the day will pay for this?
Mr. O'Leary: I will start with Deputy O'Flynn's question concerning the threat of moving the Ryanair headquarters from Dublin; there is no possibility of that whatsoever. I should say, however, that the Ryanair headquarters are not in Dublin, they are in Mullingar, which is obviously the centre of the universe. This is an Irish company and we are very proud of that fact. It is not moving anywhere else. It is one of the great Irish success stories principally because it is comprised largely of about 1,200 Irish people whose average age is 27. We would lose an awful lot of the culture and the "can do" attitude if we were ever to move it away from Dublin. I also wish to endorse the tax policies of the present Government, whereby corporation tax is down at around 12.5%, which has a significant bearing on our allegiance to Ireland for the location of our headquarters.
We did not receive € 50 million in rebates and discounts from Aer Rianta. This is another of the old canards that Aer Rianta whacks out every couple of years, saying they gave Ryanair big discounts on landing charges in the early and mid 1990s. Aer Rianta did not give us anything. We launched new routes on the basis that we would have low costs. We negotiated low costs in the form of a discount scheme that was available to everybody. In actual fact, Aer Rianta dressed that up saying "We gave them € 50 million over the ten-year period". I think the figure for Aer Lingus is about € 55 million, so they got 10% more than us even though they were not growing at all. Discounts do not represent somebody giving us rebates. The traffic would never have been there if we did not have a low cost base. The traffic has not been there for the last five years because there are no discounts or rebates. Notionally, Aer Rianta is not giving us anything by way of subsidy. All the traffic is going to other airports around Europe.
Our relationships with Cork Airport are excellent. I would go on record and say that the management of Cork and Shannon Airports are absolutely fantastic, committed, very able and bright people, but doing so would probably doom their careers forever with the Aer Rianta organisation were we to compliment them. So, I think we should just include them and say we do not like them either.
As regards the five-year deal at Cork, that is the problem with Aer Rianta, it is a PR stunt. They dressed up a five-year deal at Cork airport - it is free in year one, there is an 80% discount in year two, and 60% in year three. This is a five year deal of rising costs, yet they want us to come up with low-fare services and grow traffic. We are going all over Europe - Belgium, Germany, Spain, Norway, Sweden and Denmark - where airports are falling over themselves to give us 25 year deals. I will be happily gone from Ryanair before most of these deals unwind. They do not involve rising costs over a five year period because the world has changed. In the old days, the new route deals used to involve a three year discount; one would pay a 20% discount and one would pay full charges after three years on the basis that the route is established and one starts screwing passengers for higher fares. We do not operate that way. We keep growing the route so that this year, next year or in three years' time we will have more capacity and more flights.
Shannon is a good example. We started off two years ago from London with two flights a day and we are now up to four flights a day. It is the same in Cork. We are still growing Cork ten years after we started flying there. In the last three years we have grown it from 250,000 passengers to 400,000 passengers last year.
Deputy O'Flynn: Is it profitable for you, Mr. O'Leary?
Mr. O'Leary: Yes, everything is profitable for us.
Deputy O'Flynn: Do you intend to expand the Cork routes?
Mr. O'Leary: In fact, we offered Cork the Frankfurt route this year except that, unfortunately, the guys in Cork were not allowed to do it.
Deputy O'Flynn: Is it not true that all you were doing was switching the route from Shannon to Cork, and you were not prepared to pay anything for it?
Mr. O'Leary: Absolutely, and the lads in Cork were up for it as well. There was no problem at all giving the fellows in Clare-----
Deputy O'Flynn: I doubt if that is the case, Mr. O'Leary.
Mr. O'Leary: Believe me, that is the case.
Deputy O'Flynn: I do not believe you.
Mr. O'Leary: Do you think the management of Cork Airport did not want a new route in there?
Deputy O'Flynn: It certainly wanted a new route but it certainly did not see it in the way Mr. O'Leary saw it.
Mr. O'Leary: At the risk of compromising the management of Cork Airport, believe me, if the management down there were free to enter into a deal with Ryanair, I am convinced the Frankfurt route would now be going to Cork.
Deputy O'Flynn: I do not believe that, Mr. O'Leary.
Mr. O'Leary: That is fine. Let us agree to disagree for the sake of the management of Cork Airport.
Deputy O'Flynn: We will agree to disagree.
Mr. O'Leary: Deputy Breen said that Shannon is much better than Frankfurt-Hahn. It is not. In this country, we should get out of the notion that Ireland is a wonderful destination or that any places in Ireland are wonderful for some unique reason - they are not. If it is low cost we will get hundreds of thousands of people to go there. That is not to say that Shannon is a bad destination, it is not. I think Shannon has fantastic potential as a gateway to the west. Equally, however, as you get lost trying to find Frankfurt-Hahn Airport in the middle of Germany, so do lots of tourists get lost trying to find Shannon Airport, as I do sometimes on my way through Limerick.
Deputy Breen: No way.
Mr. O'Leary: I know you are improving the road network down there but no airport is attractive on its own. Nobody flew to Stansted in 1991, yet this year the figure will be 20 million passengers. Luton, which had about one million passengers six years ago thanks to easyJet, will have about seven million passengers this year. If you have low fares you have huge traffic growth. Airports are nothing more than glorified shopping centres; they are a means of getting people quickly through.
Bus operators carrying American tourists park near the tourist shops around Nassau Street. Many of those shops give the bus drivers a kick-back on the spend. I always wonder why airports do not do that. We are the bus drivers who deliver hundreds of thousands of passengers. The airports may not charge us to park outside their shops but they should give us a kick-back on the spend.
Deputy O'Flynn: Mr. O'Leary's company has got it in discounts and rebates over the past ten years.
Mr. O'Leary: No we have not. We still had to net pay Aer Rianta. They should go further. I was asked if I would recommend management change at Shannon Airport. Without wishing to use my Iraq simile, I would not. I think the management at Shannon Airport are fine. What Aer Rianta needs, however, is regime change - in other words, get the bloody regime in Baghdad - sorry, Dublin Airport - out of there and allow Shannon to work in the interests of Shannon, and give the guys running Cork Airport the freedom to develop traffic there in the interests of Cork.
Deputy Breen: Is Mr. O'Leary keeping his options open on Farranfore, given that he is keeping one day a week in Farranfore?
Mr. O'Leary: No, I am keeping one day a week in Shannon, and going daily.
Deputy Breen: Sorry, one day a week in Shannon.
Mr. O'Leary: Yes, I always keep my options open. If Shannon Airport comes back to us from the winter and says we can have it for free again we will go back to a daily service at Shannon. Will I take the daily service out of Kerry as a result? No. We have a three year arrangement with Kerry. The Kerry route will stay, but we can put another flight into Shannon. We can deliver another 100,000 passengers; all we need is someone to do us a deal that is competitive with the deals on offer to us around Europe.
Group travel is just a pain in the bum, unfortunately; when you are selling 96% of seats across the Internet - we do not use travel agents any more - it is very difficult to service it. The problem is these name changes. The group wants a big discount to buy three months in advance but does not want to confirm the names until the day before travel. If we block off 20 seats on a flight at a cheap fare for people who can change their names right up to the last minute, it is unfair on the travelling public because all of a sudden those 20 seats are no longer available to people who want to book across the Internet on a first come, first served basis. We think it is a fairer system for them to organise a group and let them pay, but the seats have to be booked on the same basis as other members of the travelling public, which is first come, first served.
Internal flights in this country are a joke. The committee should investigate the amount of subsidies that are being lashed out by the Department of Transport under the PSO for internal routes, which is a disgrace. This year the total for about 250,000 passengers will be about € 24 million. The average subsidy is € 100 each - that is what we as taxpayers are paying the few people who do fly between these places in the west of Ireland. Aer Aran and the other crowd up in Donegal are getting € 100 for every passenger who flies with them. Our average fare on 125 routes across Europe is € 43, yet the Government is subsidising these companies. It would be cheaper to write them all a cheque for € 50 and tell them to get the train or bus, which would probably reduce the subvention to CIE. Nestors run a fantastic service from Galway Airport to Dublin Airport for about € 15. In that way the Government could save € 85 of this bloody subsidy which is a joke. There is no huge demand for the service. I am not having a go at the regional airports which have to survive on their own, but there is no real demand for internal flights in this country. The demand is actually from those airports to London and other international destinations.
We should give up the Knock-Dublin route, yet Knock-London carries 250,000 passengers a year. Some 80% of that traffic is inbound into Knock because we deliver it to Knock. There is, however, no sustainable Dublin-Knock, Dublin-Sligo or Dublin-Donegal business because if the people will not pay enough to justify the service and there are not enough passengers, the service should not be there at all. The extent of the subsidies is a scandal when there are many other things that could be done with € 25 million, such as in the health service. I am not sure giving it to rich business people getting their early morning flights out of regional airports is a good use of that money, but it is not the business I am in.
We would provide internal flights between Shannon, Dublin and Cork, but we will not pay Aer Rianta € 10 a passenger in Dublin, € 10 a passenger in Cork and € 10 a passenger in Shannon. If it wants to provide the runways and tell us we can fly for free we will happily run those routes. The average fare would be approximately € 19 one way throughout the year and we would quadruple the traffic on the routes.
Deputy Breen: I wish Mr. O'Leary well in that.
Mr. O'Leary: It is in your control. You own Aer Rianta. You fix it. Senator Morrissey asked how passengers get from the city to the airport. They do it in the same way as the 14 million passengers who use Dublin Airport. They use buses, cars and whatever other form of transport is available. There is no problem. The big problem in terms of access from Dublin Airport to the city is the airport roundabout. Mercifully that is about to be solved by taking the M1 directly north, which will split the traffic from Swords, thus eliminating that bottleneck. Most of those who travel from the west, from where all the best people come, to access the airport travel by the Navan road and the M50.
It is crazy to put in a rail system, especially if it costs € 4 billion. Where would it take people? Would it take them to Ballsbridge? In Ballsbridge they can pay for taxis, buses or whatever. The Aircoach service does a terrific job in taking people across the city to numerous destinations. Deregulation of the bus operations to and from Dublin Airport has revolutionised access.
The big problem at the airport is the high cost of car parking. Charging € 20 a day to park a car in a field Aer Rianta got for free from the Government three years ago is an obscenity. It is another monopoly rip-off. However, under our plans, which would not cost Aer Rianta or the Government a penny, we would build two more multi-storey carparks. Part of the proposal is that we would guarantee that the daily rate of carparking would be € 10, half the current cost. Can we make money on that? I do not know, but we will do it anyway.
Dublin Airport is not a big airport. Even our plans see passenger numbers rising from 14 million to 20 million a year. It is not the biggest airport in the world at 20 million passengers a year, so please do not waste € 4 billion building a railway system to the airport. A railway system may be needed to Swords and other new towns and if it runs past the airport, God speed. That will not be a problem.
Senator Morrissey: How does the airport compare with others in terms of having no metro or heavy rail link?
Mr. O'Leary: We probably would be a bad example in terms of the airports we use.
Senator Morrissey: Mr. O'Leary's company transports huge passenger numbers.
Mr. O'Leary: Sometimes there is not even a road to the airports we fly to. It is immaterial. Passengers will find their way to the airport if the air fares are low enough. Dr. Jürgen Weber, the chief executive of Lufthansa, spent the last two years attending conferences all over Germany swearing that Ryanair would not work in Germany and that Frankfurt-Hahn Airport would not work because the passengers would not go there. Two years later, passengers will crawl naked over glass to get there because they are saving € 400 over the average fare charged by Lufthansa.
Deputy O'Flynn: To take us out of our misery, how do they get to the airport?
Mr. O'Leary: I have just told you.
Deputy O'Flynn: I regularly travel to Frankfurt. Is there vehicular transport to the airport?
Mr. O'Leary: Yes. The split at Frankfurt-Hahn Airport is that 40% travel by bus and approximately 60% drive. Of that 60%, approximately half park their car while the remainder are left there.
It has been suggested that more car parks and cars are against Government policy. I am not sure about that. Over the last five years I have discovered that more tourists and lower cost access into this country is also against Government policy. However, I live in hope and I am very hopeful that the new Government, the new Minister and the new Secretary General in the Department, in whom I have much faith, will proceed to transform this country by finally giving us competition for terminals and carparks at Dublin Airport. If they do it in two years instead of five, it will be the most significant transport initiative taken not just by this Government but probably by the previous three or four Governments.
This Government cannot fix the roads, railways or Luas before returning to the country in three or four years, but it can fix air access, tourism and the restaurants, hotels and bars. However, you must get off your backsides now and get it done. It needs decisions and action.
Senator Dooley: I apologise for my absence, but I had to attend a vote in the Seanad. Mr. O'Leary, I wish to dispel some of the mythical views you might hold about some of the members of the committee. I am hugely impressed with what you have succeeded in doing with Ryanair since 1990. While you may have a complex about what people think about you, there is widespread recognition of what you have done for the country and in developing tourism.
While I am a member of a different party, I, like Deputy Breen, am from the mid-west region, from County Clare. I am concerned about what has happened at Shannon Airport. What did you really need to remain there? You referred to an increase in costs, but I understand you were being asked to pay something as opposed to nothing. Correct me if I am wrong on that. Would you accept that it is reasonable to be expected to pay something for a service that is being provided? There is a recognition that you got a grace period. You built up a market that was not there and you deserve a lot of credit for that. However, there should be some charge. If it was approximately € 4, or whatever was the proposal, was it so significant that it would prevent people using Shannon Airport? Would another € 4 on the fare have such a dramatic impact that it would discourage them from travelling? If that is the case I find it difficult to accept, given that you have indicated that passengers will spend approximately € 3 in the airport. If passengers are prepared to do that, surely they are prepared to pay it on their fares.
I question your logic on the kick-back principle, or the fact that the concessions provided by the airport and surrounding services should assist you in using it. If that was taken to its logical conclusion, passengers would be paid to use the airport, with the kick-back made up of what they spend at the airport. That kind of transfer pricing throws the whole operation open to questioning. Why not adhere to the principle that one pays for the service one gets at each point?
You referred to carpark charges. Aer Rianta argues that a portion of the € 20 charged per day to use the car park at Shannon or Dublin Airports is used to assist in the development of the marketing funds paid to companies like yours. That is unfair to me if I do not use Ryanair. Logically, each element of the service is paid for at the point of delivery. Ryanair pays the landing charge and I pay my carpark charge.
Senator Browne: I thank Mr. O'Leary for his presentation. It is regrettable that there are not more people like him in the country, for example, in the insurance and rail freight industries. They badly need a shake-up.
Mr. O'Leary referred to the second terminal for Dublin Airport. Will he comment on the plans for a second runway? The temporary terminal is a year behind schedule and will cost € 5 million. I understand it will be demolished a few months after opening, which is daft. Will he comment on this? Does he have any views on the average cost per hour of using a Ryanair aircraft by comparison with the Government jet? Does Mr. O'Leary propose to expand Ryanair into the transatlantic routes? Ryanair is a passenger airline. Are there plans to move into passenger/air freight? That is a major problem facing us in the future.
Deputy Healy: Earlier Mr. O'Leary spoke about regional airports and in a rather throw away remark, indicated that there does not appear to be a future for them. Would Mr. O'Leary have any views on Waterford Airport, in particular, and how it might expand in the future? Is there a future for Waterford Airport? Would Ryanair be interested in operating out of Waterford Airport?
Deputy B. O'Keeffe: Does Mr. O'Leary think it is now impossible to deal with the executive at the top in Aer Rianta? Has he reached such an impasse that it will be impossible for Ryanair to do business with Aer Rianta in the future? How does he suggest we should proceed?
There is a view, which I do not necessarily hold, that Ryanair tends to play one airport against another, and the Frankfurt route is one of those where, for instance, the airports of Cork, Kerry and Shannon became involved. Like Mr. O'Leary, I am a great detractor of the top levels in Aer Rianta and have been for many years, particularly regarding developments at Cork Airport. Did Mr. O'Leary offer to do a deal with Cork Airport on the Frankfurt route when he was deciding to take it away from Shannon Airport? Is it true that Aer Rianta headquarters refused them permission to deal with Mr. O'Leary on this issue? When they found that Kerry airport was getting the Frankfurt route, is it true that Shannon Airport offered Ryanair a reduced deal which was not consistent with their national arrangement?
I also want to ask Mr. O'Leary about internal flights. Some years ago I wrote to Mr. O'Leary asking if he would consider providing flights from Cork to Dublin. Looking at Aer Arann and at Aer Lingus, by and large the capacity is full on all flights at present. I was heartened to find that Mr. O'Leary said that he could quadruple that traffic. In what circumstances could this be done?
Chairman: There is a vote in the Dáil and I ask the Deputy to bear in mind that we want Mr. O'Leary to answer some of the questions before it.
Mr. O'Leary: We can wait until the members come back.
Chairman: I do not mind. That would be okay.
Deputy B. O'Keeffe: Would Mr. O'Leary comment on the ministerial view that they should break up Aer Rianta allowing the airports of Dublin, Shannon and Cork to operate independently of each other? Can he see major self-financing difficulties for the airports at Shannon and Cork as a result of such a division?
Chairman: We have a few minutes before the vote, Mr. O'Leary, if you want to start answering some of those questions.
Mr. O'Leary: In answer to Senator Dooley, I enjoyed hearing that I had a complex about what people think of me. I do not give a hoot what people think of me. I care passionately about what people think about Ryanair in Ireland because we have fantastic people there. At various stages during the year, if I am out there shooting my mouth off, as I have a tendency to do, employees in the pubs are asked "And where do you work?", and sometimes when they say Ryanair the response is negative. The people who work in Ryanair do not get the recognition in this country that they deserve for the outstanding job they do.
What did we really need at Shannon Airport? This was Shannon's call. Shannon had a letter from us, and I will happily give the committee a copy. Dated 10 February, the letter said all the airport had to do was write back and confirm that the existing cost base would be extended, with no charge.
Senator Dooley: With no charge.
Mr. O'Leary: No charge.
Senator Dooley: A freebie.
Mr. O'Leary: Absolutely.
Senator Dooley: Like a cuckoo, sit on someone else's nest and not pay for anything.
Mr. O'Leary: I would not get too pejorative about it. One must remember that Shannon was making commercial revenue of € 3 per passenger from each of those passengers who came through the airport.
Senator Dooley: What about the hotels in the region? Does Mr. O'Leary want
Mr. O'Leary: Without passengers the hotels do not make anything, nor does the airport. All we ask is, not so much for a freebie, but for the airport to be competitive with all the other airports around Europe. We ask that they be competitive with the airports in the south-west of Ireland and they cannot even manage that.
Senator Dooley: May I ask a supplementary on that, Chairman?
Chairman: No, let him answer.
Senator Dooley: Can I ask a supplementary later, because it is important?
Mr. O'Leary: Is the Senator asking another question?
Senator Dooley: On that point, it is to do with the difficulty that airports have with other airlines. If Delta, Aer Lingus and a number of other airlines came to Shannon and asked for similar terms to Ryanair who would pay the bills? It would all come down to this € 3, € 4 or whatever it might be.
Mr. O'Leary: Yes, but mercifully this is not Russia. I do not give a hoot what other airlines say to Aer Rianta. I run my business. Aer Rianta should be running its business. If Shannon was free to do a deal on its own, Shannon would have extended that cost base. It did not because it was under instruction from the powers in Dublin not to do so, and the by-product of that is they have lost another 100,000 in-bound passengers this year, each of whom would generate commercial revenues of € 3.
Senator Dooley: Taking that to the ultimate conclusion, the airport would not be able to continue to provide the services it is providing. Does Mr. O'Leary believe in the principle that you pay for what you get, for the service that is provided to you? That is the core of it.
Mr. O'Leary: It is like some Russian analysis, like the five-year plan. You pay for what you get. I will sell you a seat today on an aircraft going to London tomorrow. There will be passengers on board that aircraft tomorrow who will have paid me € 1 and there will be passengers who will have paid me - probably at the top end - € 129 or € 149. They have each paid for what they got. There is not a lot of difference. You will pay whatever the market or the customer will bear.
Senator Dooley: What happens-----
Chairman: Members must go to the Dáil for a vote, but we will be back.
Sitting suspended at 5 p.m. and resumed at 5.20 p.m.
Mr. O'Leary: Senator Dooley made the point that everyone should pay for each service at each point. The reality is that without competition one does not really know the true cost of each service. As Shannon and Cork airports do not have the freedom to compete effectively against Dublin they cannot determine the cost of that service.
Senator Dooley: There is a cost. Given the requirement for a zero cost base, does Mr. O'Leary accept there should be a cost per passenger going through an airport?
Mr. O'Leary: I do not. Aer Rianta's numbers indicate that for every passenger going through the airport it generates € 3 of commercial revenue and just € 1 of aeronautical revenue. I will give the example, in regard to the 100,000 passengers, of the flight from Germany which arrives at Shannon Airport at 4 p.m. The airport is empty at that time, the terminal is available and we do all the handling ourselves. Aer Rianta does not incur one cent in costs, regardless of whether the flight comes in or not, nor will it save a cent if the flight goes to Kerry.
This is marginal costing. I cannot make money by selling all seats at € 1. My average fare must be approximately € 43. However, I sell 40% of seats each year at the lowest fare, which is always substantially lower than € 43. These passengers are not paying for the cost of the service, they are paying a lower cost for the service. Nevertheless, given all the income generated, I can make money.
Chairman: We have another vote.
Mr. O'Leary: The second question was about Dublin Airport. That is complete and utter nonsense.
Deputy Healy: I did not say anything about Dublin Airport.
Mr. O'Leary: The second question was about Dublin. We do not need it. Dublin has 14 million passengers a year. One runway can handle about 30 million passengers a year. Gatwick this year has one runway and will deal with 36 million passengers. This, again, is Aer Rianta trying to spend another € 200 million to € 500 million a year, from which it can then recover income. None of the airlines wants a second runway at Dublin Airport, it should not be built and the regulator is not allowing it to be built. Nevertheless, Aer Rianta is still pushing ahead with the scheme. It is complete lunacy. The Government should tell Aer Rianta to stop.
We do not need a small temporary tent at Dublin Airport for this summer. We need to push on and get the second terminal built. We can have it ready in two years.
The average hours per year on a Ryanair aircraft is 2,600. I have absolutely no idea how many hours the Government jet runs up. We have offered our services to negotiate with Boeing on the Government's behalf but it has not been taken up yet.
Ryanair will never fly the Atlantic route because one cannot get there in a 737, unless one has a very strong tail wind or passengers who can swim the last hour of the flight.
Deputy B. O'Keeffe: Chairman, I remind you that the time slot is much shorter for this vote.
Mr. O'Leary: I will keep going, Chairman. You tell me when to stop.
Chairman: I am told there will be a number of other votes. I think we should end the meeting, if that is agreed.
Mr. O'Leary: I can come back at some stage if the committee wants.
Chairman: Yes, maybe in the future. On behalf of the committee, I thank Mr. O'Leary for his very informative and entertaining presentation. We will have to disagree on some things, such as the no-shows, for example. Everybody recognises what he and Ryanair have done and are doing in the aviation industry. It is an incredible flagship for the country and for all the people who work for the company. I am sure they have to suffer criticism but they are doing a fantastic job. I thank him for appearing before the committee and we may ask him to come back again when other questions arise.
Deputy B. O'Keeffe: Can Mr. O'Leary deal with top management in Aer Rianta at this stage or has he reached an impasse where it is impossible to do business with them?
Mr. O'Leary: Yes, but with the political appointees, no.
The joint committee adjourned at 5.25 p.m. until 1.30 p.m. on Tuesday, 8 April 2003.
(Sitzungsprotokoll Committee on Transport des Parliament of Ireland vom 25.03.2003)