UK Edition
Ryanair boss secures long-coveted Airbus fleet with Niki Lauda deal
Ryanair’s chief executive Michael O’Leary has bagged himself the fleet of Airbus aircraft he has long coveted after agreeing to buy a stake in the airline of three-times Formula One world champion Niki Lauda.
The outspoken chief executive has previously said his airline boasts an all-Boeing fleet largely because he has been able to buy those jets more cheaply than ones made by Airbus.
Mr O’Leary has made failed bids for Aer Lingus and Alitalia in the recent past, both of which had Airbus fleets, but now he has secured a deal with Mr Lauda to buy a 24.9pc stake in LaudaMotion, rising to a 75pc stake once EU competition watchdogs have given their backing.
He said the purchase would “support a fleet of Airbus aircraft, which is something we have hoped to develop within Ryanair for some years”.
Just as importantly for the airline boss, Mr O’Leary said he hoped to break the stranglehold over the German, Austrian and Swiss markets held by one of its major rivals.
“With access to the Ryanair fleet and financial resources, LaudaMotion will now grow more rapidly, as it seeks to compete in a market which is dominated by Lufthansa's high airfares with its Swiss and Austrian subsidiaries,” he said.
LaudaMotion will focus on Mediterranean destinations for its German, Austrian and Swiss customers and will boast 21 aircraft once Ryanair secures the leases for six planes.
The 75pc stake will cost Ryanair less than €50m (£43.8m), but the Irish carrier has said it would spend a further €50m in the first year to cover start-up costs. Ryanair said it expected LaudaMotion to be profitable in its third year of operation, at which point it would have a fleet of at least 30 Airbus craft.
Mr Lauda recently bought most of the assets of Niki, the low-cost airline he set up but which hit turbulence last year when its parent Air Berlin filed for bankruptcy.
The deal will secure Ryanair another European operating licence beyond its existing Irish and UK ones. Several airlines have secured extra licences - including easyJet and Thomas Cook - to protect their intra-European flying rights should the UK and EU fail to agree an aviation deal.