Plummeting traffic in Reus and Gironne drives Ryanair to El Prat
It’s now been confirmed, Ryanair will fly out El Prat, the biggest airport in Catalunia. Ryanair is thus intensifying its presence in Spain and particularly in Catalunia where it already operates out of two airports, Reus and Girona. Ryanair will start to operate 20 routes out of Barcelona’s El prat as of September. This will be the sixth Spanish base for Ryanair (Girona, Reus, Madrid, Alicante and Malaga), which has already also declared to have been thinking of creating maintenance facilities in Southern Europe, in other words at El Prat Airport.
Why does Ryanair want El Prat?
I first thought it was because Ryanair managed to get a significant amount of subsidies. But as Michael Cawley said, his “company has not requested nor received any help from the Government to operate in El Prat”. Contrarily to Reus and Girona airports, Ryanair will not receive public money from El Prat. So why does Ryanair want a base at El Prat?
To get more traffic…
Reus and Gerona traffic figures give us an indication of Ryanair’s motivations. Indeed, since Ryanair has started operating out of Girona, airport traffic has for the first time recorded a decrease with a tailback of 4,7% in 2009.
More alarming for Ryanair, is the fact the its second base in Catalunia, Reus, has been loosing attractivity month after month. Reus traffic has decreased by 41,0% in February, 29% in March and 38% in April compared to the same period last year. For Ryanair, El Prat is now the only airport that could drive up its traffic in Catalunia.
…and paralyse Vueling
Vueling immediately reacted to Ryanair’s announcement, feeling directly threatened by Ryanair’s arrival. Indeed, Ryanair’s intentions are clear. The Irish company wants to increase its market share in the Barcelona region. With already 2 airports in the region, the only way to gain traffic is to compete at El Prat.
Vueling routes out of El Prat
Vueling’s spokesman declared that “they have always operated in a very competitive market and that they have a cost structure that also allows them to offer low fares”. He also added that Vueling is ready to compete with Ryanair but that the Spanish airline will carefully avoid the “Ryanair media show” .
Despite these declarations, we all know that the threat for Vueling is real.
Already vitiated, Vueling will have to face two other challenges at the same time. After disastrous financial results that mainly showed that Vueling’s merger did not reduce the carrier’s operating costs at all, Vueling’s first challenge will be to post substantial and sustainable profits.
Secondly, Vueling has to solve its labor problem. Indeed as cincodias revealed, the gap between working conditions among Vueling and Clickair former cabin crew has been a cause for disagreement since the merger. According to a former Cliclair crew member, they would be earning up to 50% less than Vueling crew members. Add to this the fact that Vueling will have to fight against the most competitive airline in Europe in terms of fares.
But Ryanair’s arrival is also a serious threat for Spanair and Iberia, which are also based in Barcelona. The two Spanish companies together lost a total of 5 million passengers in 2009 and will have to face direct competition by Ryanair in 2010. Even easyJet, the second largest low cost airline in Europe has decided to avoid El Prat due to high competition. Juanjo Duran, easyJet’s CEO for Spain, said that “Barcelona is now entering a high-risk operation with the war that is going to spark between Ryanair, Vueling and Spanair.”
