Ryanair And Lufthansa Signal Strong Recovery Of European Airline Industry

A “very strong recovery” in the coming months in the airline industry is expected by Ryanair, the largest airline of Europe by passenger numbers, according to the company’s Group Chief Executive Michael O’Leary.

Its target of flying more than 10.5 million passengers in August would be exceeded by the airline, O’Leary said. He added that the airline also expected that the number of monthly passengers in September, October and November would hold at around the 10.5 million mark even though the price of tickets is expected to be lower than te pre-pandemic levels.

“As long as there are no adverse COVID developments, things are set fair for a very strong recovery,” O’Leary said while talking to the media ahead of a press briefing in Brussels

The likelihood of a recovery in the European airline industry was also signalled by the German airline Lufthansa which said it expected to generate positive cash flow this summer. The airline also expects it would be able to fully unfurl a Covid-19 rescue package within a year, said the company’s CEO Carsten Spohr while talking to reporters on Tuesday.

In the early part of 2020, the Covid-19 pandemic had forced grounding of most of the flights of Lufthansa which pushed the airline into a crisis which forced the German government to take up a 20 per cent stake in the airline as a part of a 6 billion euro ($7.1 billion) rescue package for the airline. .

In the coming weeks, it would begin scaling down its stake in the airline and aims to completely dispose its stake in the company fully by the end of 2023, Germany’s economic stabilisation fund said last week.

“We are relieved that the government has entered the process of exiting,” Spohr said in an interview. The airline expects to mostly wrap up the rescue and stabilisation of the airline by next summer.

Spohr said the impact of the cost savings measures adopted by Lufthansa would be able to generate cash even if the number of passengers remains at only about half of the pre-pandemic levels – which was reached by the airline during the summer holiday season.

He added that the airline could reach about 40 per cent of its pre-pandemic capacity for the year as a whole.

He added that the performance of the cargo operations of Lufthansa was strong and the firm expected to make profits from it to the tune of a billion euros this year.

That compares with last year’s air cargo profit of 640 million euros.

(Adapted from Reuters.com)



Categories: Economy & Finance, Entrepreneurship, Regulations & Legal, Strategy, Sustainability, Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: