Ryanair sees fares falling further; O'Leary to stay on

A 6% drop in fares plunged Ryanair to its first quarterly loss since 2014 and Europe’s biggest budget airline said overcapacity was likely to continue driving ticket prices lower, albeit at a slower pace. Monday’s warning of more tough trading came as the Irish company said it had secured the services of its long-standing CE Michael O’Leary for another five years. The weak Q3 performance was flagged two weeks ago when Ryanair cut its profit forecast for the year ending March 2019 for the second time in three months, and the airline reiterated on Monday it could not rule out a further downgrade, noting possible uncertainty from Brexit. The firm said recent falls in oil prices would allow loss-making rivals to survive longer, maintaining excess capacity in Europe as others like Ryanair add more and more planes. O’Leary said he saw an eventual reduction in capacity, as well as consolidation in the sector, returning over 12-18 months. Ryanair, which makes most of its profit in the summer, said fares were down 1% so far for April to September with just under a fifth of bookings in place, and pointed to a “flat to slightly down-ish” trend for the year ending March 2020 if short-haul overcapacity in Europe continues.<br/>