Some Irish RyanAir pilots are refusing to fly their planes until the company improves pay and working conditions. RyanAir’s CEO has suggested laying them all off and hiring cheaper pilots from Poland.
What it means: Everyone loves a bargain, especially when it comes to expensive items like plane tickets. But as anyone who has felt peckish on a RyanAir flight knows, there’s no such thing as a free lunch. Keeping profits high when fares are low requires cutting costs elsewhere. According to the company’s fed-up pilots, it’s the staff who suffer. Their unions say salaries at RyanAir are significantly lower than those paid by other airlines (RyanAir deny this).
For RyanAir, high wages are bad for business. After it allowed pilots to unionise in late 2017, a good chunk of investors pulled out their money. RyanAir’s share prices (the cost of buying part of the company) fell by 8 per cent, wiping €1 billion off their total value. Larger staff costs would probably force it to raise ticket prices. That could cut into sales as people almost certainly aren’t choosing RyanAir for its customer service and legroom.
The standoff has resulted in flight cancellations which have already affected 50,000 travellers. RyanAir looks likely to give in for now. But its hints about moving jobs to Poland suggest there will be plenty more turbulence ahead.