Irish budget airline Ryanair began operations in July 1985. From a single turboprop to a fleet of 273 aircraft, Thomas Haynes details its sometimes-controversial history and meteoric rise to the top.
On July 8 1985, an unknown airline began flying – with an unusual feature. They were operating a single 15-seat Embraer EMB 110 Bandeirante turboprop between Waterford in Ireland and London/Gatwick, but the size of the aircraft had demanded a somewhat unorthodox approach to cabin crew recruitment.
Flight attendants could be no more than 5ft 2in (157cm) tall. It was, the company explained, “in order to be able to operate in the tiny cabin of the aircraft.”
Somehow, 35 years later, it could only have been Ryanair.
Low-cost Revolution
The Irish carrier is responsible in part, for what has been dubbed by the industry as the ‘low-cost revolution’. Together with easyJet, the so-called revolution has opened travel to the masses in Europe. Before both operators existed, air travel in the region was a luxury reserved for those that could afford the pricey tickets on legacy carriers such as British Airways and Aer Lingus.
It is popular to complain about Ryanair, of course, but the carriers’ passenger figures tell a different story. The priority of the traveller appears to have changed – gone are the concerns over which coffee blend is used onboard or if your newspaper of choice will be available. Instead, the majority of customers are voting with their wallet, and the legacy carriers know it.
The likes of Ryanair, easyJet and Southwest Airlines in the US have forced the old guard to compete, in doing so the people who win at the end of the day are the customers.
So how did the revolution begin?
Founded in Swords, Dublin as Danren Enterprises in November 1984 – Ryanair was setup by Christopher Ryan, Liam Lonergan and Irish businessman Tony Ryan, the founder of Guinness Peat Aviation. After being renamed to Ryanair shortly after its inception, the airline soon obtained permission from the regulatory authorities to challenge Aer Lingus and British Airways’ high fare duopoly on the Dublin to London route. This was the first time the low-cost carrier would compete, but certainly not the last.
The launch price of £99 return was less than half the fare of the legacy carriers’ lowest cost ticket, which was priced at £209 for a return. This marked the start of a fare battle between Ryanair and the legacy carriers of Europe.
With two routes now in operation, the firm carried 82,000 passengers in its first year of operation.
Jet Acquisition
In looking for something a little quicker, the company signed a deal with the Romanian flag carrier TAROM, to wet-lease three BAC One-Elevens in 1988.
With the arrival of these jet aircraft, Ryanair quickly increased its network to 15 scheduled routes from Dublin to Liverpool, Manchester, Glasgow and Cardiff, and opened up new routes from Luton to Cork, Shannon, Galway, Waterford and Knock.
During 1988, Michael O’Leary joined the company as chief financial officer. Anyone thinking he would be one of those senior leaders who would operate silently in the background would soon be proved very wrong.
The Irish carrier acquired a further three BAC One-Elevens from TAROM and leased a brand-new ATR 42 aircraft from GPA to service the small regional airports in its home country.
A business class service and Frequent Flyer Club were launched in 1988, although as the airline says, these initiatives proved particularly unsuccessful.
In 1989, a Short Sandringham flying boat was painted as part of a proposed sponsorship deal with Foynes Flying Boat Museum, it was sadly never flown for revenue-generating services.
Mounting Losses
During 1989, the airline leased two more ATR 42 aircraft so it could retire its smaller Embraer turboprops and Hawker Siddeley HS 748 examples.
Due to continuing losses, the business class product and Frequent Flyer Club was ended a year after both were launched. After three years of rapid growth in aircraft, routes and intense price competition with Aer Lingus and British Airways, Ryanair had accumulated £20m in losses and as a result had to go through substantial restructuring.
The Ryan family invested a further £20m in the company and following a visit to Southwest Airlines by O’Leary, Ryanair relaunched in 1990, duplicating the low fares model of its American counterpart.
Now as Europe’s first low-fare airline, Ryanair offered high frequency flights while moving to a single aircraft fleet type. It scrapped free drinks and expensive meals on board but reduced the lowest ticket prices from £99 to just £59 return.
By the end of 1990, the airline was now carrying 745,000 passengers per year.
Ryanair Restructuring
With the outbreak of the Gulf War in January 1991, passenger demand collapsed. Ryanair responded the only way it knew how, by lowering air fares. The carrier also returned its three ATR 42s to their owners, a decision which resulted in its withdrawal from regional routes in Ireland.
Despite the impact of the Gulf War, Ryanair managed to turn a profit for the first time with an unaudited gain of £293,000 for the year in which it carried 651,000 passengers.
In the early 1990s, Ryanair continued to restructure cutting back routes and fleet. The network was shaved back from 19 to just six destinations. At the same time, the jet fleet gained a seventh member in the form of an additional BAC One-Eleven.
In August 1992, the airline carried over 100,000 passengers in one month for the first time in its history. The total traveller volume for the year stood at 945,000, just shy of the one million mark.
Upsetting Aer Lingus
In 1993, Ryanair launched its first new route in five years with the introduction of daily services between Dublin and Birmingham. At the time, the Irish Government warned the carrier not to do this because it would “upset” Aer Lingus, but they went ahead anyway.
The fleet of BAC One-Elevens was increased to 11 airframes through the acquisition of four ex-British Airways examples. In December, Ryanair revealed it had struck a deal directly with Boeing to purchase a fleet of six 737s. The aircraft were operated by the UK charter company, Britannia and would allow the airline to start replacing its older One-Eleven jets, all of which were scheduled to retire in 1994.
Continued growth and expansion allowed the airline to carry over one million passengers in one year for the first time in 1993.
Boeing Boom
The Irish carrier accepted delivery of its first Boeing 737 on January 21, 1994. The aircraft, EI-CJC (c/n 22640) was purchased from Britannia Airways who had been leasing the airframe to Air Sul since 1989.
A further seven American jets were delivered during that year to replace the carrier’s ageing BAC One-Elevens, the last of which was retired at the end of the year as planned. In October Ryanair started services from Dublin to London/Gatwick replacing Aer Lingus who had pulled out of the route.
In September 1995, Ryanair became the first low-cost airline to operate a domestic route in the UK, with a service from London/Stansted to Glasgow/Prestwick. The Boeing boom continued with the purchase of four more 737s, this time from Transavia, bringing the fleet to 11 aircraft.
Traffic figures also exceeded two million for the first time that year.
Public Flotation
On May 29, 1997 Ryanair became a public company after a successful flotation on the Dublin and New York Stock Exchanges. The shares were more than 20 times oversubscribed and the price surged from a flotation cost of €11 to close at €25.5 on their first day of trading.
All the company employees received shares as part of the flotation process and at the close of the first day, staff received over €100m worth of shares.
In October 1997, the carrier launched its third airport base at Glasgow/Prestwick with daily flights to Dublin, London, Paris and Frankfurt. At the end of the year, passenger figures were at 3.7 million.
In March 1998, to keep up with the pace of growth, Ryanair places an order for 45 brand-new Boeing 737-800 series aircraft. Valued at over $2bn, the deal comprised 25 firm and 20 options.
To help pay for these jets, the operator issued new shares to the value of more than $110m.
On March 20, 1999, Ryanair took delivery of its first new 737-800, EI-CSA (c/n 29916). Four more examples were delivered that year. The aircraft began operations at the airline’s main base at London/Stansted.
By the end of the millennium, the low-cost airline employed more than 1,000 people and carried 5.3 million passengers that year.
Meteoric Rise
In 2000, the carrier launched a website with an online booking function. Initially said to be a small unimportant part of the software, increasingly the portal contributed to its aim of cutting flight prices by selling directly to passengers.
Within a year, the website was handling three-quarters of all bookings.
The start of the new millennium marked a turning point for Ryanair which until 2000, had only experience moderate growth. The next decade would see it increase traffic figures by more than 1000% to 66,503,999 per year, by the end of 2009.
To support this traffic growth, Ryanair operated a fleet of 232 737-800s and employed more than 7,000 people by the end of the first decade of the new millennium.
Since its inception, Ryanair had only operated with its Irish Air Operator’s Certificate and solely under the same brand. However, in 2018 it dropped the single-airline strategy and announced it would be introducing additional brands and operating on multiple licenses in different countries.
Since then it has set up four subsidiaries including Austrian-based Lauda, Polish-based Buzz, Ryanair UK and Malta Air.
Today, its fleet has ballooned to 469 aircraft including all its subsidiaries and 273 for its core brand. The company employs an average of nearly 16,000 people and last year, carried over 142 million passengers making a pre-tax profit of €948m in the process.
Like all airlines, Ryanair was not immune to the impact of the COVID-19 pandemic. It grounded its entire fleet on March 24 and resumed 40% of its normal schedule from July 1.
The company has now said it will take until the summer of 2022 for demand to return to 2019 levels. Despite this, there’s no question that Ryanair has come a long way over the last 35 years. The Irish carrier has risen to the top and is now comfortably Europe’s largest airline by passengers flown.
