Business Irish

Wednesday 18 September 2019

Ryanair share price down almost 30pc since February as woes mount

Pilots for Ryanair Holdings Plc and members of the Irish Air Line
Pilots’ Association on a picket line near Dublin Airport last July. Photo: Bloomberg
Pilots for Ryanair Holdings Plc and members of the Irish Air Line Pilots’ Association on a picket line near Dublin Airport last July. Photo: Bloomberg

Fearghal O'Connor

Ryanair's share price has fallen by almost 30pc since February after a summer of woes for the low cost carrier.

News that pilots in both Ireland and Britain had voted for strike action hit shares hard last week and, by the time markets closed on Friday, the price had finished the week down 6.3pc.

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Irish-based Ryanair pilots who are members of the Irish Air Line Pilots' Association - a branch of trade union Forsa - last week voted overwhelmingly to back industrial action.

The union - which represents 180 pilots at Ryanair - said it would write to management early this week to outline plans for action unless the airline agrees to union pay proposals by tomorrow.

"This Forsa threat of industrial action has no mandate from Ryanair pilots, and is ill-timed just 10 weeks before a hard Brexit, while Ryanair is in the process of letting excess pilots go due to the Boeing Max delivery delays," said Ryanair in a statement. "Forsa should continue in mediation and avoid threatening unnecessary disruptions to customers holidays and travel plans."

The airline has been under pressure on a number of fronts in recent months. A major restructuring of its corporate organisation, that sees Michael O'Leary take on an over-arching role at a new holding company for the company, has not been enough to convince investors.

The corporate rejig has since been overshadowed by the revelation that chief operations officer Peter Bellew - who returned to the airline from a stint as chief executive of Malaysian Airlines - is to take up the role of chief operating officer at key rival EasyJet. The ongoing problems with the Boeing 737 Max, which remains grounded following two crashes, has also proved to be a big blow to Ryanair.

O'Leary recently said he could not rule out thousands of job cuts because of the crisis as he reported a fall in profits. Ryanair had planned for the first batch of its overall order of 135 Max aircraft to be delivered during April but has since had to pull back on ambitious expansion plans that the aircraft would have allowed for.

The Max - referred to by Ryanair as "the gamechanger" - was a key part of the drive to cut unit cost efficiencies and to hit 200 million passengers a year by 2024.

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