Ryanair fares 'set to fall 15%' amid Brexit uncertainty


Ryanair boss Michael O'Leary has said the airline's fares are expected to fall by up to 15% this winter amid continuing uncertainty over Brexit negotiations.

But he warned that once the UK leaves the European Union there will be a reduction in the number of flights operating from the country, leading to price rises.

Chief executive Mr O'Leary also criticised the confusion over any changes to the rules on airline ownership, and what routes can be operated to and from the UK.

The airline said profits jumped 7% in the first half of the year as it increased the number of passengers it expects to carry by 2024.

It said half-year profits after tax reached 1.168 billion euro (£1.042 billion) to the end of September, up from 1.088 billion euro (£971 million) over the same period last year.

The trading update comes after Ryanair slashed its earnings forecasts last month as it grapples with the impact of the Brexit-hit pound.

The airline expects full-year earnings of between 1.30 billion euro (£1.17 billion) and 1.35 billion euro (£1.22 billion), down from the previous range of 1.38 billion euro (£1.24 billion) to 1.43 billion euro (£1.28 billion).

Average air fares fell by 10% to 50 euro (£44.61) in the year from September 2015.

Mr O'Leary described this as "good news for customers, not so good news for shareholders", but added that the latter would have to "learn to live with it for the foreseeable future".

He went on: "For passengers what is inevitable is in the next 12 to 18 months you benefit by having lower fares.

"But over the medium term if there is a hard Brexit there will be less capacity here in the UK and less capacity means higher prices, once the hell we know what Brexit looks like."

Mr O'Leary said uncertainty over Brexit has led the airline to reduce its planned growth in the UK next year from 12% to 5%.

The airline boss, who campaigned for Remain in the referendum, described the politicians negotiating Brexit as "puddings" and claimed the UK economy is in "real trouble".

He said: "It's hard to believe that the UK Government could be more uncertain or it's going to get any less certain as to what the hell they're doing about Brexit. Given that they haven't an idea what the hell they're doing about Brexit in the first place.

"Mrs May is out in India about to give free movement to Indian citizens now. But at least you're controlling your borders here.

"You're going to prevent the Europeans coming here but at the cost of giving the Indians free visas and God knows what else. It's a shambles but long may it continue to be such a shambles until they realise they're better off staying in the single market."

He went on: "It looks like these puddings are heading for a hard Brexit simply because of their own incompetence. The UK has no negotiating position."

Mr O'Leary warned that the aviation industry faces uncertainty over what ownership restrictions would be in place after a hard Bexit and what routes could be flown if the UK leaves the EU's Open Skies aviation free market.

He claimed this could lead to the break-up of British Airways' parent company IAG, as it also owns three European airlines, and UK holidaymakers having to travel by boat to Spain.

"There are a whole series of potential outcomes here that are fantastical and unimaginable," he said.