Ryanair is cutting the number of its winter flights by a third because of Covid air travel restrictions across the EU and has warned of further job losses as passenger numbers plummet.
The airline previously cut the number of flights in October to around 40% of normal levels, but is now extending the reduction through November to March, down from the 60% previously planned. It is still hoping to keep its planes 70% full, in order to break even and “minimise cash burn”.
“There will regrettably be more redundancies at those small number of cabin crew bases, where we have still not secured agreement on working time and pay cuts, which is the only alternative,” said Michael O’Leary, Ryanair’s chief executive.
“While we deeply regret these winter schedule cuts they have been forced upon us by government mismanagement of EU air travel.”
Ryanair, along with other European airlines and airports, had been lobbying for a harmonised approach to air travel during the pandemic, to ensure – at the least – more predictable and consistent rules on cross-border travel.
However, the European council agreed a recommendation only this week, issuing guidance on restrictions for member states that fell far below the aviation industry’s hopes.
Ryanair said it was “inevitable” that pilots and cabin crew would also have to take more unpaid leave and participate in job sharing this winter, adding that it was a better outcome than “mass job losses”.
The airline said it would maintain most of its winter route network, but offer fewer flights. It is already temporarily shutting bases this winter in Cork and Shannon in Ireland and in Toulouse, France. It will now cut the number of flights from bases including those in Austria, Belgium, Germany, Portugal and Spain.
Ryanair has also cut its full-year traffic forecast to 38 million passengers, down from 50 million. Last year it had 149 million passengers.
“This guidance could be further revised downwards if EU governments continue to mismanage air travel and impose more lockdowns this winter,” the airline said.
“We continue to actively manage our cost base to be prepared for the inevitable rebound and recovery of short-haul air travel in Europe once an effective Covid-19 vaccine is developed.”
Ryanair’s move comes despite signals that the quarantine period for travellers arriving in the UK could soon be cut from 14 days to about a week under a “test and release” scheme being considered by the government’s taskforce, which will report in November.
The transport secretary, Grant Shapps, said on Wednesday the new regime would probably require a single coronavirus test, to be taken about a week after arrival and paid for privately.
The amended rules are unlikely to satisfy the aviation and travel industry, which has argued for rapid airport testing. According to Iata, the global airline body, quarantine deters almost as many passengers as would an outright travel ban.
Ryanair shares fell almost 4% on news of the schedule cuts. EasyJet’s stock dropped by a similar amount.
Gerald Khoo, a transport analyst at Liberum Capital, said: “The path to recovery from the pandemic was never going to be direct or smooth. Ryanair’s plan of 40% of prior year is still considerably more than easyJet’s 25% target. However, it appears more realistic than the 75% of normal indicated by current published timetables for the industry as a whole.”
Khoo said Ryanair’s strong balance sheet, low cost base and focus on leisure routes meant it was “the best positioned European airline to cope with what is likely to be a very tough winter and prolonged recovery phase”.