Aer Lingus - strange co-incidences

R

rmelly

Guest
I read this morning that Aer Lingus are finally abandoning their fuel surcharges, and are also considering restoring some flights between Shannon and Heathrow. I wonder what inspired these moves?

What most surprises me is that up to very recently they were claiming to be locked into expensive futures contracts that justified the surcharges. I wonder what has changed, almost overnight.

It's almost comical - they (Aer Lingus) say we can't allow a Ryanair 'monopoly', but we clearly can't trust an Aer Lingus operating in a competitive environment either.
 
Maybe that will allow people to focus on the real question they should ask themselves when buying a ticket: is it worth it?

Getting hung up about fuel surcharges is taking your eye off the ball.

The funny thing is that both Aer Lingus and Ryanair still persist in pricing as extras charges that cannot be avoided by the customer, and we just don't get annoyed enough about this deceptive practice.
 
I also was watching flights to NYC in march next year. Including fuel surchage of 60 euro each way the flight was costing 350 euro, now after the removal of the surcharge its now 400 euro! I think its time that aer lingus realised that people are not stupid and that customers do shop around!
 
Does anyone else find it strange that the mgmt have come out so strongly against O'Leary? Regardless of their personal views, I thought that mgmt usually remained independent in takeover situations, and the non-exec board members were responsible for taking a view on the value (or otherwise) of the takeover offer. Why would this not be the case here?
 
Because it's personal between Aer Lingus and Ryanair - always has been, always will be. Michael O'Leary won't rest until he's crushed the former "flag carrier". I believe that's his primary motivation, and I can't say I blame him. Ryanair is everything Aer Lingus is not.
 
extopia said:
Because it's personal between Aer Lingus and Ryanair - always has been, always will be.
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No surprise there, but aren't there legal obligations on AL management to stay independent?

extopia said:
Michael O'Leary won't rest until he's crushed the former "flag carrier". I believe that's his primary motivation, and I can't say I blame him. Ryanair is everything Aer Lingus is not.
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Phoenix has an interesting analysis showing that Michael needs AL more than AL needs Ryanair. AL's performance this financial (roughly break even) is sparkling by comparison to Ryanair. Micko held off hedging fuel until the last minute (costing him a fortune) and then hedged as the market peaked (costing him a further fortune).
 
Complainer said:
AL's performance this financial (roughly break even) is sparkling by comparison to Ryanair. Micko held off hedging fuel until the last minute (costing him a fortune) and then hedged as the market peaked (costing him a further fortune).
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I could be wrong, but I think the hedging scenario you mention is no longer an issue for Ryanair.

As to financial performance, Ryanair is a far, far bigger player than Aer Lingus. AL may turn in the odd decent performance, but it's a niche player. Won't be around much longer.

It's kind of funny the AL has given up the ghost and is practically begging to be taken over by Lufthansa, KLM or Air France (in other words, anyone but Ryanair).

I've no idea what an Air France controlled AL would look like, and whether it would present any real competition out of Ireland to Ryanair. But I do think it's important that Ryanair has competition.

A monopoly Ryanair is a beast we haven't yet encountered, and probably don't want to.
 
Aer Lingus has Euro1.3 billion in cash. It would be the bargain of the century for Ryanair if it got Aer Lingus for Euro748 million.

Ryanair is promising 1000 new jobs following takeover of Aer Lingus. It promised 2000 jobs in 2004 when it opened a base in Shannon. As a direct result of the recent budget and in particular on introduction of the Euro10 departure tax, Ryanair announced that it was removing 75% of its aircraft based in Shannon, which would reduce Ryanair jobs in Shannon directly by 100.
 
olddoll said:
Aer Lingus has Euro1.3 billion in cash. It would be the bargain of the century for Ryanair if it got Aer Lingus for Euro748 million.
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Well, so Aer Lingus keeps saying. But I assume the airline has debt on its balance sheet too?
 
Aer Lingus has €800 million in cash after debts, etc.


ryanair has committed to taking delivery of in the region of 30 new aircraft per year over the next couple of years and these have to be paid for. It is currently closing routes and letting workers go. Their pilots are being put on unpaid leave. Not a pretty picture.
 
Not pretty, no, but a normal response to the fact that we're in a recession and people are flying less?


Aer Lingus financial statements are available on its website. Its total cash and other current assets amount to 1,237 million. Its current liabilities are 673 million. So its net cash is in fact less than 600 million. The airline's total equity is 915 million, well under the ryanair offer. So you can't really say it's a laughable bid.
 
I see on the irish independent today that people who booked tickets before last friday and still haven't flown may be entitled to a refund on the fuel surcharge
 
Slightly OT, but I think I heard that there are calls from the consumer association to refund passengers the amounts that they were burdened with in the form of fuel surcharges.

Whilst I'm all for justified compensatory action (and great if you can get it), I can't see how this is reasonable myself. No matter what passengers were charged or why they were charged it, people were under no obligation to purchase any flights but by doing so, accepted any terms and conditions (including costs) anyway.

Am I missing something?
 
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