Opportunities Ryanair

931 Words Dec 28th, 2012 4 Pages
Opportunities

Europe 's bloodbath (again)
1. Recessionary conditions suit true Low Cost Carriers best. The global economic recession has handed Ryanair and similar carriers near-perfect operating conditions. As Ryanair explains, "this recession has encouraged passengers to become much more price sensitive which is why they are switching to Ryanair 's low fares and unbeatable customer service over all other competitors".
Ryanair expects a 15-20% reduction in average fares this year to around EUR32 per passenger. Ryanair is expecting that several of its smaller rivals will not be able to withstand falls of this size over a longer period. This means that Ryanair is in a position to profit handsomely over the next 12 months.
Ryanair 's
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This would require off-base (like crew lodging in areas not having home bases) service operations increasing operational costs. This will cut into its operating margins. At the same time, its improved services can have a positive impact on the share prices. Since stock market earnings are always based on expansions and high operating margins they will continue to be vulnerable to market dynamics. Ryanair is already the leader in the lower price segment and it needs to cater the rapidly growing value segment to have total domination. The value segment constitutes travelers interested to optimize time, comfort and price.
2. Preferences would have to be given to city-centric airports, convenient departure and arrival times, and basic service. Competitors like Easy Jet, Air Berlin, Basic Air, BMI Baby are catering to the Value market segment. They have been successful in establishing slots at some primary airports and providing basic cost effective services. Acquisition of Aer Lingus has not only enhanced Ryanair’s expansion plans and market share but also helped it to stay in the top position of being in the low-price segment. The SWOT analysis given below explains how Ryanair can achieve its goals and mission by capitalizing on opportunities and utilizing its strengths and eliminating its weaknesses and threats.
3. OPPORTUNITIES: EU regulations, dependence on economic cycle.
- LCC market share can double
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