Irish budget airline Ryanair’s RYA.I boss Michael O’Leary said on Wednesday the UK air travel industry was weaker than Europe’s as British consumers grapple with high interest rates and a cost-of-living crisis.
“Europe itself is strong, Italian domestics are strong, Spanish domestics are strong, Eastern Europe is strong. The UK I think is probably a little bit weaker with the exception of London,” he said, referring to the demand for air travel in each market.
“People are generally struggling here in the UK, interest rates are much higher, energy prices are higher, the economy is not in a good place here. We would expect weakness in the winter,” he added, speaking at a press conference in London on the airline’s winter schedule.
Ryanair – Europe’s largest airline by passenger numbers – is taking a cautious approach, O’Leary told reporters even as he estimated current booking levels were around 4%-5% higher than last year.
He said “demand for travel is not insatiable”, citing signs of a dip in consumer confidence.
Earlier, the head of British Airways owner IAG ICAG.L, Luis Gallego, said demand for travel was “very, very strong”, except from the corporate sector, adding that the recovery of corporate demand in Spain was happening faster than in Britain.
A rebound in travel following the damaging impact of pandemic restrictions on the sector helped Ryanair make 663 million euros in after-tax profits for the three months to June, beating market expectations.
O’Leary estimated Ryanair would carry 183.5 million passengers in the current fiscal year, compared with 149 million pre-COVID.
“We are certainly seeing people booking earlier at slightly higher fares,” O’Leary said after a robust summer period.
“We’re seeing very strong demand. What’s unusual is this is the second year in a row we’ve seen very strong demand at very strong prices. That can’t continue.”