Ryanair under attack: consumers may love the company, consumer associations don’t
There must be some kind of voodoo doll with “consumer associations” written all over it at Ryanair’s headquarters in Dublin. Or at least there should. While the low-cost airline’s passenger volume are a testimony to its attractivity for passengers, consumer associations don’t buy at all into Ryanair’s formula. Instead, it seems that in an almost every European country it flies to, there is an association set on destroying Ryanair’s reputation.
This year, the ball was opened in the United Kindgom by consumer association Which?, which – sic – threw a “super-complaint” against abusive card fees by retailers, taxi and low-cost airlines, first and foremost being Ryanair. The goal of the complaint was to get the Office of Fair Trading to investigate the use of those surcharges and, eventually, try and correct them. It wasn’t the first time the OFT had to investigate abusive credit/debit card fees at Ryanair’s and the organism wasn’t particularly indulgent in its judgement of the company. It estimated the fees alone amounted to over £ 100 million a year and exhorted low-cost airlines to stop profiteering from these. To the outrage of Ryanair, which claimed it had no credit/debit card fees.
More recently, it’s in Spain that Ryanair has been under attack. This time after FACUA – Consumidores en Accion published an enquiry showing that, according to passengers, Ryanair was the company responsible for the most abuses. Of course it could be quickly brushed as a side-effect of Ryanair’s passenger volume, but apparently, even compared to easyJet, Spanair or Vueling, the company still held the lead by a long shot, with 60% of Ryanair passengers considering the airline’s practices abusive. That didn’t please Ryanair too much and it quickly took the association to court for slander. The move proved to be unfortunate as, in doing so, Ryanair gave much more visibility to FACUA’s assertions and lost the case after a judge ruled the association could get behind laws protecting freedom of information.
The last, and perhaps most painful, sting, came today from Italy’s concurrence regulation authority. The governmental body fined the airline a hefty € 500 000 for “unfair commercial practices” a reproach grounded on the fact that Ryanair doesn’t include all optional costs in its advertised fares. While the sum is consequent, it still represent barely 1,37% of what Ryanair earns on its “Wheelchair and insurance levy” alone. Of course the airline has no plan of handing out the cash just yet and is planning an appeal to the decision, denouncing it as “senseless”. But it’s not the first the Italian authorities condemn an airline for similar reasons (they’ve already done it with Alitalia, Blu Express, Air Italy, Germanwings, Wizz Air and easyJet) so there are still reasons to believe Ryanair might have to pay.
Putting all the accusations side by side clearly makes it look like Ryanair is being harassed by consumer associations. But, in the end, there are only a limited number of reasons that could motivate Ryanair not to include all optional fees in its advertised fares. The first is linked with Ryanair’s corporate culture; the company has made a habit and a very successful PR trick of always contesting accusations leveraged against it. The second one could lie in the extreme price-sensitivity of Ryanair’s customers. The airline has made its success on extremely low prices and must be afraid of losing its edge if it has to include fees in its prices. Of course the irony is that, if it truly is the cheapest around, Ryanair shouldn’t be afraid of price transparency.
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