Overview of Ryan Air - Essay Example

In the years1990 and 1991, the firm had new management and this resulted into a complete overhaul. The firm adopted some practices of Southwest Airline and this made it to cut its routes to 5 from 19. By the year 1991, Ryan Air was in possession of 6 aircrafts, 350 workers, and besides, it carried about 700,000 passengers annually in the five routes and from the year 1991 to the year1997, the firm increased the fleets it had to 21, and besides, it increased the routes it followed. All through this period, the number of passengers continued to grow because of the low fares that were charged by the firm.

The firm was prevented from expanding its market by strict regulations that were enforced on the European airlines. However, the year 1997 was a turning point for the airline industry in Europe and for Ryan Air; this was because the regulations that prevented the airlines form expanding their boundaries were lifted and the airlines had the opportunity of establishing newer routes so as to cover the whole continent of Europe; thus this made Ryan Air to expand its routes. By the year 2001, Ryan Air had the largest travel website in the whole of Europe and in a span of three months after the launch of the website in the year 2000; it got more than 50,000 online bookings in a week.

The firm realized that passengers were in need of transportation which was very fast and also inexpensive and for the firm to offer the cheap transportation method, low costs as well as efficiency were vital. Therefore, Ryanair changed business within the industry by providing lower charges and despite this; they have managed to make consistent profits through reduced costs. Through the use of Southwest model of lower costs, Ryan air developed a strategy, which was different from the ones of Lufthansa, British Airways, as well as Air France, for instance Ryan air made use of one aircraft fleet that ensured there were economies of scale in planning as well as training its crews, stocking spare parts and also maintenance of its planes (Leocha).

The firm also transitioned from B737-200s as well as B737-300s, which was bought by the firm as second hand to newer B737-800s. The firm reduced maintenance costs by introducing newer aircraft and besides, the productivity as well as the efficiency of the firm also improved through the use of no-frills methodology. Customary, in-flight services like seat allocation, complimentary drinks, meals and provision of newspapers were eliminated by the firm, rather, the company got a lot of profits from the minor services through charging passengers for in-flight services as well as additional travel expenses like travel insurance.

Besides, workers were always compensated when sales were made and therefore, Ryan Air benefited through increased profits as well as efficiency. The passenger base of Ryanair grew to 23.1 million in the year 2003 down from 6.1 million in 2000. During this period, the profits made by the firm greatly increased to €226.5 million from €72.5 million. The competition within the airline industry in Europe was changed by low-cost-low frills strategy of RyanAir and this made a number of other low-cost operators to amalgamate to counter competition.

The objective of Ryanair is to establish itself firmly as the leading low-fares airline in Europe through persistent improvements as