Monday, February 01, 2021
Hope for a quick recovery
Ryanair is heading for a record loss
The aviation industry is struggling with drastic sales losses in the Corona crisis. At Ryanair, a deficit of up to one billion euros is expected. According to experts, the low-cost airline could recover much faster than the big airlines.
The low-cost airline Ryanair is heading for a record loss of almost one billion euros due to the Corona crisis. In the 2020/21 financial year, which will run until the end of March, a deficit of 850 to 950 million euros can now be expected, the airline announced. That would be around five times as much as the previous record loss after the global financial crisis a good decade ago. "Covid-19 continues to wreak havoc in the industry," said Ryanair boss Michael O'Leary. 2020/21 is the most difficult business year in the company's 35-year history.
From October to December alone, Ryanair flew a loss of 306 million euros. The number of passengers collapsed by 78 percent, sales dropped by 82 percent. The competition also complained about a high drop in sales. At Easyjet, revenues plummeted by 88 percent, at the Hungarian low-cost airline Wizz the minus was 77 percent. For the full year, Ryanair stuck to its forecast of 26 to 30 million passengers, but it will probably come down to the lower end of the range. The low-cost airline from Ireland was more optimistic about the new financial year beginning in April, for which it expects 80 to 120 million passengers.
A sweeping recovery can be expected from July, when travel restrictions in the pandemic can be relaxed and most people in Europe are vaccinated against the disease. By the end of the 2021/22 financial year, 70 to 90 percent of the pre-crisis capacity could then be achieved.
Experts trust Ryanair to recover from the crisis more quickly than the large network airlines such as Lufthansa or Air France KLM. This is because the low-cost airline, which specializes in direct flights, does not have long-haul flights with business travelers, who are suffering most from the global slump in air traffic, in its program. With currently 3.5 billion euros in available funds, the budget airline, which operates at particularly low costs, also has a comfortable financial cushion. It will roughly stay at this level through the end of March, O'Leary said.
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