FlyerTalk Forums - View Single Post - Without subsidies, Ryanair would be in the red
Old Jul 8, 2012 | 6:47 am
  #13  
bankops
10 Countries Visited
20 Countries Visited
30 Countries Visited
15 Years on Site
 
Join Date: Jul 2007
Location: Luxembourg
Programs: KLM/AF Platinum for life, IHG Platinum, Accor Platinum
Posts: 1,027
While I hate Ryanair with a passion and refuse to set foot on a plane operated by them. I cannot but consider such articles as nothing less than a waste of time and even a waste of the electricity used to keep them saved on a disk somehwere.

I negotiate special rates with a hotel because I am planning on spending the next year in a city. Now I could do this two ways. I could say that at the end of each quarter, they will pay back to me 40% of my spend with them OR I could just negotiate a 40% reduction. Now which one of these is a subsidy? Neither in my opinion. They are both volume discounts.

Now, most of what Ryanair does is the same. They take a small airport that will charge them various fees of X, Y and Z. They then negotiate that the owner of the airport (local or regional government) will pay them back an amount of A based on traffic. Now, they derive A by looking at the extra money and jobs that their traffic will bring, so it isn't just a % reduction of the airport fees.

This is the whole premise that caused them to win the Charelroi lawsuit. ANY airline or other airport related business has the right to negotiate fees and tarrifs being charged by another company (or government).

To say that Ryanair would be bankrupt without subsidies is just simply sensationalism. I find most of Ryanair's practices absolutely reprehensible, but on this particular point I cannot see anything wrong.
bankops is offline