Ryanair’s boss Michael O’Leary has said in an interview with the Wall Street Journal that the decision in Britain to leave the European Union has caused concern over weaker airfares and has raised questions at Ryanair holdings over continued investment in the UK.
O’Leary confirmed that Ryanair is committed to buying a further 50 aircraft next year and it is now “highly unlikely” that these will be based in the UK, preferring other European bases.
Shares in Ryanair have been hit badly in the initial stock market reaction to the Brexit vote with concern that a lower pound and a fall in economic growth will hit passenger demand.
O’Leary said “there clearly is going to be a hit to the UK’s GDP and to European GDP. There is three to four months of considerable uncertainty. The pound has fallen through the floor. It has all the feel and hallmark of another 9/11.”
Ryanair is to respond to the uncertain market by lowering fares to ensure its aeroplanes are full.
The airline, which carried 116 million passengers last year, expects to reach 180 million passengers by 2024 with a switch in growth now planned from the European Union rather than from the UK.
But bookings are holding steady due to Ryanair’s usual targeted marketing of spare capacity through low fare sales ensuring that the summer schedules have shown strong demand.
Ryanair and other UK based airlines such as easyJet face regulatory questions following the Brexit vote as they operate currently under the EU’s single aviation market which allows any EU airline to fly to any EU city.
British carriers are lobbying the government to remain part of the European aviation area but if this is not possible, O’Leary said that Ryanair would have to get a U.K. license to enable it to continue to operate from its London Stansted base even though this would push up costs.
