During this decade the number of routes flown by Ryanair has increased by over 1,000 per cent. It currently carries more international passengers than any other airline. It has outdone the old-fashioned subsidised national airlines. Its disciplined, no-frills approach to the mass market for air travel is a wealth generating emblem of our age. Its boss even welcomes the recession and looks forward to the company being strengthened by it. Just one thing: if you’re flying Ryanair, don’t throw up.
Ryanair’s CEO Michael O’Leary has given two reasons to welcome the recession. On the one hand, Ryanair “would welcome a good, deep bloody recession for 12 to 18 months. We need one if we are going to see off some of this environmental nonsense.” On the other: “A recession gets rid of crappy loss-making airlines and it means we can buy aircraft more cheaply.”
O’Leary is on the record acknowledging he is obnoxious and worse. He has cultivated a reputation for outspoken comment, aiming his often foul-mouthed attacks at targets ranging from governments, to competitors, travel agents and environmentalists. He is also self-evidently a high-powered businessman with much of the responsibility for Ryanair’s extraordinary success. O’Leary is almost certainly right that Ryanair is well placed to ride out the recession in good shape, expanding its market share during it and piling its profits yet higher as recovery kicks in.
It is the success of the airline that is the problem.
I started thinking about this after a recent return trip on Ryanair. On the flight home, I saw that the aircraft’s seats had no seatback pockets, which means, I suppose, that it is among the batch of 70 Boeing 737s ordered in 2005 (with an option for a further 70). This saves Ryanair money. Apparently, added to other economies like doing away with the seats being able to recline and getting rid of window shades, savings are some hundreds of thousands of dollars per aircraft.
Ryanair has been relentless in its pursuit of cost-cutting so this is no surprise. The biggest innovation O’Leary brought in during the 1990s was to cut the turn round time on the ground, on the obvious principle that the more time the planes are in the air, the more money they make. Ryanair also led the way in on-line booking – and you cannot now buy tickets through travel agents – and is well on the way to getting rid of airport check-in desks.*
But of course, cost-cutting has implications. Take away the seat back pocket and you take away the sick bag. We already knew from a Channel 4 report in 2006 that Ryanair cabin crew spray perfume around to hide the smell rather than clean up any stray vomit, which is quite understandable given the very short turn round times they have. But back then at least virtually all planes had sick bags.
Has Ryanair thought about what it will be like for other passengers if that 12-year-old who is eating chocolate and is over excited does actually upchuck when the plane hits some turbulence? Has Ryanair thought about the feelings of humiliation that a passenger of any age will likely will go through of s/he has to throw up uncontrollably?
More to the point, does Ryanair care?
The Economist magazine once said Ryanair had “a deserved reputation for nastiness.” There is plenty of negative comment to be found on the internet. The airline refused to provide wheelchairs at Stansted, saying it was the airport’s responsibility; when instructed to share responsibility with the airport, Ryanair responded by adding 50 pence to ticket prices.
In February this year, Michael O’Leary suggested the airline was considering charging for the use of the lavatory on board the plane. He later claimed that while it was a possible future option, today it was just a way to get cheap PR. But if it was a joke it backfired because it is entirely believable that Ryanair would do that. Extra costs are Ryanair’s stock-in-trade.
Last year the consumer value magazine Holiday Which identified Ryanair as the worst airline when it came to hidden costs. They catch a lot of people out with their lower than average baggage allowance – 15 kilos instead of 20, -and an iron-clad policy on refusing to turn a blind eye to the odd half kilo. They get a lot more people with a web-site which, compared to all competitors, is a confusing mess. If you don’t figure it out, watch out: there will be an extra twenty pounds if you didn’t check in on-line, plus twenty pounds for each bag that you didn’t check in. And then when you come to get on the plane, there’s an inconsistently applied policy of one bag per person; if you can’t get everything into one bag, the extra one will have to be checked – for another twenty pounds. O’Leary complained bitterly about the extra security restrictions that came in during 2006, but now he has found a way to add to the bottom line, Ryanair has left the one-bag restriction in place while other airlines have lifted it. Again, they catch out unwitting passengers on the difference between the norm and their more restrictive policy – and they make money out of it. With all of this, for many travellers, Ryanair stops being a cheap option – the fare itself is low but the add-ons are brutal.
And then there’s the staff. Plenty of negative comment circulates about them too. One on round trip I saw and heard the following:
- a passenger reduced to tears, while being threatened with denial of passage if they do not cram everything into one carry-on bag, while other passengers with two carry-ons walk past
- a passenger already on the plane stopped by the senior cabin crew and told his bag is too big and it must be either emptied or off-loaded, when to my eyes the bag seemed smaller than ones already pushed into the overhead; the problem was not the size of the bag but that the passenger was one of the last few to get on and all the space was used up
- the tone of self-righteousness with which staff charge passengers for checking in at the airport or for being slightly over the 15 kilo limit for hold check-in luggage.
When I queried a handful of staff about this kind of behaviour I was told quite simply that their jobs were at stake. And it didn’t take any pressing for more than one to say how unhappy they were with it and how much they disliked coming into work.
It’s certainly possible to sympathise with them. And the airline should be concerned about a demoralised, disloyal staff who are busy alienating passengers on company instructions. At the end of that flight I took, the cabin crew had the nerve to ask passengers to help them clean the plane. And it was just plain laughable when a 40-minute late landing, which is not a problem in itself, was greeted with fanfare (literally) as yet another on time arrival.
None of this is incidental. All this unpleasantness and money-gouging, from the lack of sick bags to the staff’s attitude, is integral to a business model that is based on the constant hunt for new ways to cut costs and augment profits from the add-ons.
There is no question that this model is successful. Michael O’Leary is spot on when he indicates that the recession will put weak airlines to the wall while the strong survive and thrive; other things being equal, Ryanair is likely to be more successful in the future. And as for the treatment of passengers, well, regular users of air travel know all too well how much like cattle the economy class passengers of other airlines are treated for much of the time. Whoever said it was more blessed to travel than to arrive never got to spend much time in economy class or on the low fare airlines.
But in the end the question is whether that’s the world we want to build. Michael O’Leary was Forbes magazine’s “European Businessman of the Year” in 2001 and the rest of the decade has proved the magazine right. Ryanair has succeeded by pursuing the bottom line beyond any other consideration as long as the people pay up, which we carry on doing because we want cheap air travel.
So, three comments on that:
First, chasing the profit regardless of other considerations such as welfare is part of what led the finance sector into the credit crunch, out of which the global economic downturn came. The point was to make loans, regardless of whether the individual could pay back, and thus we got the sub-prime crisis. Now the argument is not that the same fate awaits Ryanair; rather, the argument is that this is the business approach that got us into our current mess, so it would be well to have another think about it.
Second, Ryanair’s business model puts pressure on its staff and on the passengers and subjects us all to increased stress. That is a cost. It is not simply an issue that the costs of flying Ryanair are likely to be higher than they first seem because of the add-ons; rather, there are other costs – non-monetary but real costs in terms of happiness and health – and these should surely be brought into the frame of the discussion. And however much we do want and use cheaper air travel, the issue of climate change cannot be left to one side in this discussion of the other costs of doing business.
Third, it does not have to be the case that low fares mean rude staff and money-gouging. Not all of the surplus operating income has be devoted to profit, after all; some could be used on staff training and welfare and on passengers’ well-being. Michael O’Leary would still have become a very rich man.
On a different mode of transport, for hints of an alternative, take a look at an independent railway line in Britain – the Wrexham and Shropshire, neatly described, including the dilemmas of how to get quality service at low prices in a competitive environment, in an Observer article a few weeks back.
* UPDATE 15 May 2009: As of 20 May, Ryanair is abolishing check-in at the airport. You do it online. If you arrive at the airport without a boarding card printed out from the online check-in, you will have to pay £40 to have a boarding card issued to you. So the emphasis on getting extra money out of their put-upon passengers continues.