Tuesday 20 August 2019

Latest UK watchdog decision has ‘an element of Ryanair bashing’

Louise Kelly

Louise Kelly

THE latest UK watchdog decision ordering Ryanair to sell a 25pc stake in Aer Lingus has an element of ‘Ryanair bashing’, according to a leading aviation reporter.

“There’s a lot of things wrong with aviation all across Europe so why are we interfering with two Irish airlines?” travel writer Simon Calder of the London Independent asked on RTE Radio this morning.

The UK’s Competition Commission has issued a final decision this morning, telling Ryanair to sell a 24.8pc stake in Aer Lingus.

The watchdog said that it based its decision on the fact that Ryanair’s 30pc stake in Aer Lingus affects the UK traveller.

But, according to Calder, “I can’t see that it would benefit the UK consumer.”

And, although he maintains that Ryanair won’t be necessarily ‘harmed’ by the ruling, he says that Ryanair is being targeted to some extent.

“Some of its business practices are disliked by many people in the aviation industry,” he said.

The commission has stated that Ryanair could weaken Aer Lingus through its use of voting power at shareholding meetings and may also weaken the competitive position of Aer Lingus by restricting its expansion onto routes in competiton with Ryanair 

Mr O’Leary’s firm also has fewer incentives to compete on price with Aer Lingus as it owns almost a third of it, according to the UK watchdog.  It said that, as a result, ‘the British traveller is suffering and likely to suffer more in the future’.

Calder also said that “nobody is going to want to take a third share in an airline that has to compete directly with Ryanair”.

Ryanair chief Michael O’ Leary responded to the decision this morning that the airline will appeal the UK regulator’s decision, which he describes as “faulty”.

“They have come up with not one instance where Ryanair has influenced the behaviour of Aer Lingus,” he said.

But Calder believes that this may not be beneficial in the long run.

“This will drag through the courts and the only people that will really benefit will be the lawyers,” he said.

Aer Lingus has welcomed the decision.

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