Quotes of the Day

Michael O'Leary
Sunday, Aug. 27, 2006

Open quoteMost people using British airports since an alleged terrorist plot was foiled in early August have reacted with understanding and patience to the resulting long delays, canceled flights and crowded security checks. But one man is livid: Michael O'Leary, the CEO 404 Not Found

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of budget airline Ryanair. He has been an outspoken critic of BAA, the privatized company that operates British airports, describing the new security arrangements as "a shambles." Last week, O'Leary went a step further by suing the British government for $5.7 million for what Ryanair claims to have lost through cancellations and lost bookings in the week after the plot's discovery. The government says the suit has no merit. O'Leary, who has promised to give the money to charity if the company wins, said: "Ryanair's sole motive in this action is to defeat terrorism by returning airport security to normal."

Other airlines affected, including British Airways and Virgin Atlantic, aren't joining Ryanair in its suit. Analysts say the move reflects a vulnerability in Ryanair's business model: O'Leary has turned the Dublin-based carrier into Europe's most profitable airline by cutting airport turnaround time to a minimum to keep his planes aloft as much as possible. That means discouraging any behavior that can slow his planes down, including checking baggage. But O'Leary may have the last laugh. Unlike regular airlines, Ryanair charges a fee for each bag that is checked: up to $9.50 apiece, if passengers register bags at the airport rather than paying for them in advance when buying their ticket. According to Ryanair's website, that fee is set to increase by 40% in September to $13.20 per bag, so the company will benefit handsomely from the new, tougher checked baggage rules. For O'Leary, it seems, every airport crowd has a silver lining. Close quote

  • PETER GUMBEL
  • No-frills carrier Ryanair sues the U.K. government for losses caused, it claims, by increased airport security
Photo: REUTERS | Source: No-frills carrier Ryanair sues the U.K. government for losses caused, it claims, by increased airport security