Ryanair sets down terms in fees row

RYANAIR has told Aer Rianta that it will only fly new routes out of Dublin if landing charges are fixed at £1 per passenger

RYANAIR has told Aer Rianta that it will only fly new routes out of Dublin if landing charges are fixed at £1 per passenger. And it said yesterday that unless a deal is concluded at around this level before Christmas, it will fly all new routes from Stansted in London.

Ryanair confirmed yesterday that it has bought six aircraft from the German airline Lufthansa for $60 million (£36 million). It will launch new routes next year, most of which will operate from Stansted.

However, the privately owned company has constantly criticised the charges imposed by Aer Rianta, saying they are the most expensive of all the airports it uses. Aer Rianta has agreed to reexamine its landing charges following a recent request from the Minister for Transport, Energy and Communications, Mr Lowry.

Ryanair's chief executive, Mr Michael O'Leary, said it would launch several new routes from Stansted anyway, but a deal with Aer Rianta on landing charges would have to be concluded before Christmas if Dublin was to be used for any new routes.

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This, he said, was necessary if Ryanair was to have the routes included in spring schedules. "We have a submission in with Aer Rianta for some time now," he said. He added that £1 was the rate which Stansted had agreed with Ryanair for new passengers.

Ryanair's financial director, Mr Howard Miller, said the airline currently had proposals from 18 airports to use its services.

Ryanair said the new aircraft, Boeing 7375, would form the basis of its core London-based fleet. They would enable the company to develop a range of low-fare services to Stansted. That airport is currently handling 5 million passengers per year and could handle up to 12 million, according to Ryanair.

Mr O'Leary said Ryanair would like to base some new routes from Dublin. The brand name is well-known in Ireland and it would be easier to grow the market more quickly.

Ryanair's commercial director, Mr Tim Jeans, said there was still some resistance in Britain to low-cost operators. However, the market in Britain was far bigger.

Ryanair maintained that new routes would be profitable very quickly because of the company's low-cost base.

It said it had borrowed 70 per cent of the money, with the rest from internal sources. It is understood that the monies were borrowed from several Irish institutions including Allied Irish Bank and Bank of Ireland.

The first aircraft will be delivered next week. Three will arrive in April and May next year and the last two will be delivered in October 1997. The aircraft were built in 1981 and 1982. The acquisitions bring Ryanair's fleet to 17 and take care of the company's requirements into 1998.