EasyJet’s Stelios Says Ryanair Growth Plan Is ‘Do-or-Die’ Folly
By Farah Nayeri and Steve Rothwell
Nov. 12 (Bloomberg) -- EasyJet Plc founder Stelios Haji- Ioannou, who thwarted management plans to boost capacity, said rival Ryanair Holdings Plc is courting disaster if chief Michael O’Leary sticks with his growth strategy.
Dublin-based Ryanair needs to increase passenger numbers by 50 percent over the next 2 1/2 years to fill its 200 aircraft and another 100 on order, said Stelios, who is known by his first name. O’Leary said Oct. 13 that he aims to lift the total almost 30 percent to 85 million in three years.
“I am looking forward to seeing how this do-or-die mission of Ryanair and Michael O’Leary will end up,” Stelios said in an interview in London yesterday. “I believe that he will have a lot of grounded aircraft in the next few years.”
Stelios, 42, campaigned against a high-growth strategy at Luton, England-based EasyJet until the carrier said in July it would increase the number of seats by 7.5 percent a year compared with an average of 15 percent between 2005 and 2008.
Ryanair, Europe’s No. 1 discount airline, said Oct. 13 that it wants to buy another 200 aircraft from Boeing Co. by the year’s end. O’Leary says he’ll walk away from negotiations and cancel some existing commitments if a deal can’t be struck.
“It must be difficult for Stelios to see us continue to grow while his airline grows more slowly, if at all,” Ryanair spokesman Stephen McNamara said from Dublin. “Ultimately, Ryanair believes that EasyJet will be bought by a larger airline group within the next five years. EasyJet will be gone so Stelios won’t have to worry about Ryanair for much longer.”
EasyJet’s new growth plan is “a lot more sensible” and “much more profitable,” said Stelios, who with his family is the airline’s No. 1 investor with a 38 percent stake.
“The company is performing very well and the growth rate has been moderated,” he said. “When the debate started, it was last September, right after Lehman Brothers collapsed. Who knew how bad this would get? So I’m delighted to say the world didn’t come to an end.”
EasyJet spokesman Oliver Aust said the carrier has developed a more realistic business plan than Ryanair.
“We follow a different strategy and we feel ours is better,” he said. “We fly to major airports, which is where our passengers want to go.”
EasyJet shares have gained 30 percent this year, valuing the carrier at 1.55 billion pounds ($2.56 billion). Ryanair is down 4 percent and worth 4.21 billion euros ($6.3 billion).
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Pourquoi Stelios fait comme si dans les 200 avions, aucun ne servira à remplacer des plus anciens, est ce uniquement pour destabiliser Ryanair?