Ryanair is yet to decide on a long- term strategy for its new UK airline division Buzz following the "opportunistic" acquisition of its low-fare rival last month (Flight International, 4-10 February).
Michael O'Leary, chief executive of the Irish low-cost carrier, says the former KLM subsidiary will be operated as a "bolt-on" division under Buzz's UK air operator's certificate (AOC), but will lose its branding from 1 April when the deal is due to take effect. He adds that the long-term strategy for the airline will have to be "revisited in one to two years" to decide how to best integrate the UK arm with the remainder of the airline. O'Leary denies that Ryanair's London Stansted operations could be transferred to the Buzz AOC. "Both will operate side-by-side," he says.
O'Leary promises to make Buzz profitable within three months by "halving fares and doubling passengers," as well as laying off 100 of its 500 staff. He adds that any union action could result in Ryanair closing the airline.
The rationalisation plan for Buzz's route network will be rolled out at the end of February, and will involve axing certain routes and increasing frequencies on others. Buzz's planned Bournemouth, UK, base and its French domestic routes have been dropped. Services to Amsterdam Schiphol, Frankfurt Main and Paris Charles de Gaulle will also end as "we simply can't turn our aircraft around quickly enough", says O'Leary.
Buzz's eight BAe 146-300s will be returned to KLM at the end of the year. Its two Boeing 737-300s are to be returned to Pembroke Group, with six similar aircraft being leased from International Lease Finance in the coming months. O'Leary says he has yet to decide if the second batch of six 737s to replace the 146s from 2004 will be -300s or -800s.
Although access to a UK AOC could allow Ryanair to compete with EasyJet on services from the UK to Eastern Europe, O'Leary says this is not a near-term ambition. However, sources at the airline say the region is high on its agenda for expansion.
Brit Air has filed two petitions with the Administrative Court of Strasbourg, claiming that Ryanair is receiving illegal government aid in the form of subsidies for its Strasbourg-London services.Source: Flight International
