Aer Lingus Takeover by Ryanair - For or Against?

I've always appreciated what Ryanair did for Ireland in bringing down airfares and increasing choice. It transformed tourism and business life.

The proposed takeover of Aer Lingus by Ryanair would mean much reduced competition, but may strengthen Ryanair and increase the chance that we will have an Irish connected air line at all in future. Ryanair say that they will restore the Shannon - London service and are prepared to make guarantees about other slots and on Union membership. The hope would be that Ryanair is an Irish based company and would be a better option for Ireland than any other predator that might snap Aer Lingus up. The fear would be that one big company would have no competitive pressures and that both services and prices would suffer. Any thoughts?

http://www.breakingnews.ie/ireland/mhsnauauojoj/

cactus flower wrote:

I've always appreciated what Ryanair did for Ireland in bringing down airfares and increasing choice. It transformed tourism and business life.

The proposed takeover of Aer Lingus by Ryanair would mean much reduced competition, but may strengthen Ryanair and increase the chance that we will have an Irish connected air line at all in future. Ryanair say that they will restore the Shannon - London service and are prepared to make guarantees about other slots and on Union membership. The hope would be that Ryanair is an Irish based company and would be a better option for Ireland than any other predator that might snap Aer Lingus up. The fear would be that one big company would have no competitive pressures and that both services and prices would suffer. Any thoughts?

Yes, but on O’Leary, they’re not printable. If he were on fire I’d burst first.
As you say it may well be the best option for Aer Lingus, but my first preference would be for them to remain independent as they are.

I agree tonys, I would prefer Aer Lingus to remain independent. O'Leary's move has focussed atrtention on the political nature of the Aer Lingus board. That will have to change no matter what happens in order to ensure professional corporate governance by a board who understand the nature of the busienss ther have on their hands.

Those slots those slots, my kingdom for those ..

Let him take it on condition that the slots remain in Government control. As far as I know he's made noises towards this end. That way the Government could regulate him or threaten him with leasing slots to other carriers.

The free competitive market should be in operation but in fairness I don't think it's Aer Lingues who are really competing with Ryanair now.

Are the State actually able to hold the Heathrow slots? I have heard O'Leary saying that they will be vested in the State but it seems like a complex idea, I'd like to see on what basis you can actually hold slots if you are not an airline.

What's complex about it johnfás ? The slots get leased for a year subject to pricing review and other carriers may tender for cheaper fares from Shannon to Heathrow each year. If the Govt. decides by dáil vote to lease those slots to other company then fine.

Would a contract covering eventualities be very complex ?

But do the UK airports authorities permit Governments to hold slots at airports? Can I buy a slot at Heathrow? I know the answers to none of these questions.

In principle it sounds good but the Government haven't said if you can actually do it.

When push came to shove over Shannon, Aer Lingus made a supposedly business based decision. By some accounts, it is not panning out too well in terms of loadings from Belfast to London.

I'd be concerned that prices generally might go up if AL was taken over, but if they went up too much, surely another airline could move in and undercut Ryanair in due course?

Michael O'Leary has been so loathed, despis-ed and rejected, that perhaps he will up stakes and move elsewhere, once he has mopped up AL.

Is there another argument that we should stop using planes anyway? As someone who is a very poor sailor on ferries that would mean virtual incarceration on this lovely island.

If we banned planes I think our economy would be in even worse shape .

johnfás wrote:

But do the UK airports authorities permit Governments to hold slots at airports? Can I buy a slot at Heathrow? I know the answers to none of these questions.

In principle it sounds good but the Government haven't said if you can actually do it.

Well maybe I'm living farther up in cloudcuckooland than I thought but I'm sort of equating the slots with eircom wires; water pipes, roads, bus stations; train tracks; Eirgrid wire network - Assets that the state should have certain control over but sure, may sell if they like. Eircom Eircom Eircom.

I should get into reading the Dáil committees but I'm just so busy I can't set the time aside seemingly. MOL was in there yesterday being scrutinised by shrewd Clare TDs Timmy Dooley FF and Pat Breen FG. He was no doubt Pied-Pipering the Shannon Heathrow slots. He'll have to whip them back from Belfast though. Pity there isn't a Shannon-Belfast Ryanair link I could go shopping ...

Chambers Ireland against Ryanair's AL bid from morning Ireland yesterday
http://www.rte.ie/news/2008/1218/morningireland_av.html?2464876,null,209