Business Irish

Saturday 22 September 2018

Comment: Turbulence ahead as Level takes off

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John Mulligan

John Mulligan

Europe's already cut-throat airline market just got tougher.

With oil prices rising (Bank of America Merrill Lynch yesterday predicted they could hit $90 a barrel by next summer), Michael O'Leary's prediction that more airlines are headed for collapse looks more than ever like it could have a ring of truth.

Last year, the collapse of Air Berlin and Monarch laid bare the bruising battle to win passengers across Europe's short-haul route network.

And the entry of Level into the short-haul market will further intensify competition.

It also raises a question as to how long IAG might be willing to wait to buy Scandinavian carrier Norwegian. IAG snapped up a small stake in Norwegian earlier this year and said it's interested in buying the airline outright. But IAG CEO Willie Walsh - as he did when IAG was trying to buy Aer Lingus - has insisted that buying Norwegian would be attractive to IAG, but is not a deal he has to do.

With Level, he may end up having all the firepower he needs.

Irish Independent

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