Ryanair reported a near 50% fall in half-year profits to the end of September despite a 19% increase in passengers and said it hoped to do no more than break even over the year as a whole.
However, chief executive Michael O’Leary repeated a previously declared intention to launch a separate airline flying from Stansted and Dublin to the US if a recession allows him to buy a long-haul fleet of aircraft on the cheap. He suggested one-way economy fares to the US could start at £10.
Worryingly for the rest of the industry, O’Leary forecast Ryanair’s average fares would fall by up to 20% in the months to April, resulting in an average price fall of 12% over the year.
One leading analyst warned: “Airline yield management systems are struggling. This reads very negatively for all airlines and tour operators.”
O’Leary claimed a recession would “get rid of crappy airlines”, but conceded obtaining the long-haul aircraft for his proposed start-up carrier remained a “huge if” and it could take up to three years to set up.