The birth of Ryanair and the Low-Cost Airline sector

| October 19, 2017

Mark Tungateby Mark Tungate, author of The Escape Industry: How Iconic and Innovative Brands Built the Travel Business

The elements of the low-cost model are more or less visible to passengers. They include a single-class service, the use of ‘secondary’ airports that charge lower landing fees (ah, the glamour of the Luton to Beauvais run!), deploying staff in multiple roles – the crew member who scans your ticket at the gate shows up later to sell you a sandwich – seats that don’t recline, and additional charges for checked bags, on-board snacks… and just about anything else they can get away with. Low-cost airlines also ‘hedge’ on fuel costs by buying in bulk while prices are low, and push for modifications in aircraft design that allow for more seats inside and reduced drag outside.

The internet, of course, changed everything. Once passengers could buy tickets, register luggage and even check in online, the entire process of filling an aircraft and getting it aloft could be streamlined – while direct booking did away with the costs associated with travel agents.

One of the main beneficiaries of this revolution was Ryanair, notoriously the low-cost carrier with the fewest frills of all. It was started in 1984 by a group of Irish businessmen, including Tony Ryan, founder of aircraft leasing company Guinness Peat Aviation. Ryanair began flying between Waterford and Gatwick Airport to compete with British Airways and Aer Lingus, adding the Dublin–Luton route in 1986.

In 1992 the European Union deregulated the airline industry, allowing European carriers to greatly increase their scheduled services across the region – an opportunity Ryanair seized.

The Internet Revolution

Ryanair’s website came online in 2000. Nine years later, it was able to dispense with check-in desks: passengers did everything online, apart from dropping off their bags. Ryanair’s ultra-low-cost model was occasionally satirized – but the airline itself was happy to make outrageous statements as a way of stirring publicity. Around the time that it was poised to remove check-in desks, O’Leary mentioned in a BBC interview that the airline was thinking of charging passengers £1 to use the on-board toilets. He later admitted that the idea was unfeasible and went against EU regulations. (‘Spend a penny, pay a pound with Ryanair’, The Guardian, 27 February 2009.)

Ryanair took a similar no-frills approach to promotions, with internally produced black-and-white print ads that courted controversy: a 2012 campaign featuring lingerie-clad flight attendants under the line ‘Red hot fares & crew’ was one of many to attract the ire of the Advertising Standards Authority.

But the airline’s skeletal service also equated to a lousy customer experience – exacerbated by tetchy and impatient staff – and passengers began to drift away. Chastened, the airline launched a campaign of improvements, such as allocated seating, permitting a second carry-on bag and ‘giving more flexibility for frontline staff to tolerate minor infringements’ of its rules on baggage size, for example. Profits began to rise, although a drop in fuel costs also contributed. (‘Fewer rules, less hassle, more profit – how being nice paid off at Ryanair’, The Guardian, 30 May 2015.)

 Flying for Less 149

FlyBe, Wizz, Vueling, jet2.com, Air Europa… the website Flylc.com (www.flylc.com) lists no fewer than 32 budget airlines serving Europe alone. A Telegraph journalist was able to fly around the world on 10 low-cost airlines, from easyJet to Norwegian. The entire round trip cost him less than the equivalent of US$2,000. (‘Around the world by budget airline: 10 flights, £1,653 –here’s how to do it’, 8 April 2016.)

The sky-scape has changed utterly since the 1970s. Flying, while not always very comfortable, has definitely become accessible. We’re all part of the jet set now.

The Escape Industry: How Iconic and Innovative Brands Built the Travel Business by Mark Tungate, is out now, published by Kogan Page, priced £19.99.

For more information see: www.koganpage.com


This extract from The Escape Industry by Mark Tungate is ©2017 and reproduced with permission from Kogan Page Ltd.

 

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