According to the mayor of Clare, the town in Ireland where Shannon Airport stands, if Ryanair reduces its operations there by 75 percent as threatened, the airport will become a ghost town. Ryanair aggressively battles what it considers unfair airport charges in its goal to provide low-cost service. When they can’t get the airports to lower costs, they move operations to another more cooperative field.
This drama playing out in western Ireland over the implementation of a $15 tax on departures from Shannon. Ryanair has asked the airport to remove the tax by February or they will move their business elsewhere.
Ryanair service at Shannon Airport is a big deal for the airport. The airline flies almost 60 percent of the flights in and out of the airfield. With the demise of the Shannon-U.S.A. flights that once kept the airport functioning, Ryanair has become the biggest dog in the game.
Even some of the local politicians have come out supporting Ryanair in this battle with the airport administration and the region.
TD (member of Irish parliament) Joe Carey said: “While there is inevitably a certain amount of gamesmanship and negotiating tactics from Ryanair, there can be no doubt that the travel tax has been a disaster for the Midwest region. It should be removed and removed immediately.”
Now, the county and the surrounding region has to choose between maintaining a questionable tax or keeping thousands of jobs and significant low-cost air service at the airport.
Ryanair is holding a strong hand in this game of negotiation. They issued the airport a strong ultimatum:
“If the Government £10 (US$15) travel tax is removed at Shannon, then Ryanair will commit to delivering more than 1.2m passengers annually, on up to four based aircraft and 200 Ryanair jobs being maintained at the airport. However, if the Shannon cost base is not extended, or if the Government’s £10 tourist tax is not removed, then Ryanair will reduce its Shannon base by 75 per cent to one based aircraft, which will largely operate the London and some British provincial routes, guaranteeing just 50 jobs, and 300,000 passengers per annum,” said Ryanair’s Michael Cawley.
The airport before Ryanair began service had about 300,000 enplanements. During the time Ryanair has been serving the airport as its largest customer, passenger counts have soared to almost two million. That means Ryanair is responsible for 1.2 million passengers in and out of the airport, not a shabby number.
It will be a big decision by the airport management, but I somehow see regulators finding a way to keep Ryanair happy. After all, a lot of jobs are at stake that far exceed any revenues garnered by their tax.
(Photo: From PS76 Trip Report on Airliners.net.)
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