Ryanair, Europe's largest airline by passenger volume, is about to get a run for its record-high revenues. The budget carrier, with recent third quarter profits of €95 million ($104 million), is facing mounting competition on the continent – so much so that fliers can expect lower fares than ever before, according to the German Aerospace Center (DLR)'s biannual survey of the low-cost airline space.
According to the analysis, made available to German newspaper Die Welt, Dublin-based Ryanair is expanding its network by 25 percent with a whopping 35 new connections. Main competitor Easyjet is touching down with seven more. But the two market leaders are starting to get crowded out by fledgling low-cost competitors such as Wizz Air and WowAir, and thriving regional rivals such as the UK's Flybe, Air France's Hop! and Eurowings. German flagship carrier Lufthansa, Eurowings' owner, is poised to dominate that domestic market by taking over struggling Air Berlin.
"The flight network of low-cost carriers is reaching a new peak with 518 different connections from Germany in the winter half of the (last) year," DLR representative Peter Berster told the newspaper.
Given hiking competition, airlines are also using plummeting oil prices to decrease fares, with the price for a basic no-frills flight hitting a new average low of €44, about €20 cheaper than previous DLR statistics.
Ryanair and Wizz Air have both considerably dropped their prices compared to last year, with the former offering flights from Germany to new destinations such as Sofia and Bucharest for as little as €10 ($11) round-trip.
But the Irish heavyweight and its outspoken CEO might need to rethink scrapping plans for trans-Atlantic flights, as long hauls appear to be the new crucial low-cost frontier. According to the DLR research center, Norwegian Airlines plans to set up a base in Düsseldorf, from where it wants to offer cheap flights to Boston and New York. Much-hyped Icelandic competitor WowAir has already been delivering passengers from New York to Reykjavik for as little as $250 return. Eurowings has also increased its essentials-only flights to Asia and the US from Germany significantly this spring, with the total number of long distance flights across Europe doubling compared to last year.
Barbara Woolsey writes for Handelsblatt Global in Berlin. To contact the author: [email protected]