Ryanair Holdings Plc will cut 3,000 jobs and said it will challenge some 30 billion euros ($33 billion) in state aid being doled out to save its European competitors.
The Irish discount carrier on Friday added to a mounting employment toll that includes 12,000 cuts at British Airways and 5,000 at SAS AB. Ryanair said it’ll carry less than 1% of its normal passenger volume in its fiscal first quarter and doesn’t expect a full recovery until summer 2022 at the earliest.
The bailouts targeting so-called flag carriers like Air-France KLM, Deutsche Lufthansa AG, Alitalia SpA and SAS will distort competition and hurt healthier carriers, Ryanair said. The plans are “in clear breach of both European Union competition and state aid rules,” Ryanair said. “This unlawful and discriminatory state aid will be challenged by Ryanair in the European courts.”
Carriers across the region are asking for help to survive the coronavirus crisis that has grounded much of Europe’s air traffic, endangering not only the airlines but connections that keep tourists flowing to Rome and Paris and help power Germany’s export economy. The flood of cash will lead to discounts that damage Ryanair’s business, the Irish discount carrier said.
Chief Executive Officer Michael O’Leary has consistently railed against bailouts, likening them to “doping” that keep bloated, inefficient rivals afloat.
Ryanair said it expects flights to resume in July, and that “it will take some time for passenger volumes to return.” The company is working on reducing deliveries of 737 Max narrow-bodies from Boeing Co. and Airbus SE A320-series jets from leasing firms.
