Dooley: Government should heed Virgin warning on IAG takeover

Mike Dwane

Reporter:

Mike Dwane

Virgin Atlantic has said an IAG takeover for Aer Lingus could lead to rising fares
COMPETITION concerns raised by Virgin Atlantic over the weekend are another reason for the government to halt the proposed sale of Aer Lingus to IAG, according to Fianna Fail transport spokesman Timmy Dooley.

COMPETITION concerns raised by Virgin Atlantic over the weekend are another reason for the government to halt the proposed sale of Aer Lingus to IAG, according to Fianna Fail transport spokesman Timmy Dooley.

The local TD for Shannon Airport has reiterated his opposition to the takeover at a time when there is mounting speculation that the government will agree to sell its 25.1% stake to IAG.

Virgin Atlantic, a competitor of IAG, intervened in the debate by writing to members of the Oireachtas transport committee warning the sale could see an increase in ticket prices and impair quality of service and connectivity from Ireland.

“The concerns expressed by Virgin Atlantic reflect the issues raised by me and my party colleagues over the past few months,” Deputy Dooley, a member of the committee has said in response to Virgin’s intervention.

“Simply put, this is a bad deal for Aer Lingus, its workers and Ireland as a whole. Virgin warns that the IAG deal would create a monopoly in the market leading to higher prices and deteriorating service levels for customers; something which I have been arguing since the bid for Aer Lingus first emerged.

“The ‘assurances’ put forward by IAG do nothing to allay my fears about the risk to connectivity and jobs at Dublin, Cork and Shannon airports. As an island nation, it is particularly important that access to the UK, Europe and further afield is maintained and protected, but the current offer by IAG gives no tangible guarantees,” Deputy Dooley stated.

“Despite the seriousness of the implications of the sale of Aer Lingus, the Government has still not committed to retaining the state’s 25% stake in the airline. This latest intervention by one of the world’s leading aviation companies should sound alarm bells and reinforce the fact that the outright sale of Aer Lingus to IAG is not in the best interest of Irish air travellers or inbound tourists.”

Meanwhile, the man who lead the government steering group that recommended Shannon be made independent of the DAA has given his backing to the IAG takeover.

While many in the region fear the impact the deal may have on Shannon’s Heathrow and transatlantic services, Denis Brosnan said the takeover would be the “right thing” for Aer Lingus and Shannon would have to “fight its own corner”.

Speaking at a Chamber of Commerce event in Kildare, the former Kerry Group boss and resident of Croom, said a small airline like Aer Lingus would find it hard to survive into the future.

“Shannon, Cork and Dublin will have to fight their own corner for relevance. Airlines will always fly into a region if there’s business to be done,” Mr Brosnan said.