Amid all the economic pessimism of a credit crunch that has now turned into a worldwide recession, and a week that has seen airports close due to heavy snow, it is heartening to hear that Europe’s biggest discount airline, Ryanair are regarding 2009 with optimism. Ryanair have raised their profit forecast for 2009 due to the falling price of oil and believe that their net income over the following year will total somewhere between 50 million euros and 80 million euros, meaning that the Dublin-based company will break even this year.
“Ryanair is going to emerge from the current downturn in the industry within an even stronger position,” said John Mattimoe, analyst at Merrion Capital in Dublin, “It’s the only company that’s committed to growing and it will be able to use it’s strengths.”
The International Air Transport Association has predicted that passenger volumes will fall by 3 percent in 2009 due to the global recession, and that airlines worldwide will most likely have combined losses of some $2.5 billion, but Ryanair is hoping to counteract this falling demand for air travel by attracting passengers with its temptingly low fares.
In times of recession and cut back, some of the first industries to be hit are those offering goods and services that are generally regarded as non-essential, so one might expect some reduction in the demand for holidays. However my contacts in the travel industry say that they have not noticed any significant decline in demand yet. It may well be that the one thing people do need in difficult times is a holiday to blow the cobwebs away, and companies offering budget travel and holidays could be the ones to do well in periods when people are looking to save money. Not only that, but business travellers may well be looking to the cheaper airlines to get them where they want to be.
2009 could well be rosy for the budget travel industry in general.