Originally Posted by
NickB
While I hate FR with a vengeance, I have to say, however, that the argument is fallacious. If the subsidies weren't there, FR would not have started those services in the first place and would have gone for other routes.
The subsidies are allowed for a reason: they are there to enable an airline to start a route that would otherwise be unlikely to be profitable.
I understand your point, but I am not sure that Ryanair would have been able to find so many profitable-yet-unsubsidised route opportunities.
And you comment that "the subsidies are allowed...". Actually, subsidies for new air routes are allowed in the EU only under fairly strict conditions. The situation you mention where a route is not going to be profitable without a subsidy is a specific case, a Public Service Obligation, which goes through a specified public bidding process, and I don't think that Ryanair still operates any PSOs (they had one route in Ireland for a while). The vast majority of airport subsidies to airlines such as Ryanair are not PSOs, just "ordinary" start-up aid for new routes, and there are specific conditions under which this aid is allowed (e.g. the funding is open to any carrier, it diminishes over time, it's for a maximum of 3 or 5 years depending on the region, the route has a realistic prospect of sustainability after the aid runs out, etc.) The European Commission currently has, IIRC, 16 open investigations into airport subsidies, mostly to Ryanair, and seems to be opening another one every month or two. Recent progress reports from the Commission in respect of Altenburg and Angouleme airports seem to suggest pretty clearly that the subsidies to Ryanair were in flagrant contravention of the rules and - if this is confirmed in the final judgements - they'll have to be paid back. Much fun awaits!