Airport to sue Ryanair for breach of contract
SHANNON Airport Authority is expected to pursue Ryanair for financial compensation of at least €2m for breaching the terms of a five-year contractual agreement with the airport.
That agreement, which was signed in 2005 and is due to conclude next April, included the stipulation that the no-frills airline was to carry 1.9 million passengers though Shannon in the fifth year of the agreement.
However, Ryanair was perceived to have broken that agreement following cutbacks in services this March and those pending this October, which were announced just last week.
The airline has also indicated that it may not renew that deal next year, representing another financial blow to Shannon Airport and the region given the latest cutbacks by Aer Lingus on its transatlantic routes.
Ryanair said it expects to handle just 800,000 passengers at Shannon this year, compared with 1.9 million last year.
But Mr O'Leary said this February that reaching this traffic target "was rendered null and void" by the Government's j10 traffic tax, which the carrier described as tourism suicide.
In the wake of the latest cutbacks, the airline persisted that it will resist any claims and warned that the airline's base at Shannon could shut down.
"The base in Shannon could close altogether and Dublin could face the loss of one or two extra aircraft this winter. This is just the start of it. There are going to be more cutbacks in July and August as tourist numbers collapse," said Mr O'Leary.
He added that he has no desire to maintain a loss-making service in the west of Ireland, especially as he gets "no thanks from the Government or the tourist bodies there for our Shannon services".
Shannon Airport Authority said it had no comment to make in the present time.
The new cuts at Shannon Airport will result in the loss of 36 flights per week, 300 jobs and up to 300,000 passengers – in addition to cuts announced just three months ago at the airport by Ryanair.
Mr O'Leary said staff in Shannon affected by the cutbacks could seek to transfer to other bases in Europe, but no redundancy would be paid by the airline.
"We don't do redundancy," he explained.
Specific routes which will be affected in the carrier's winter schedule from October 1 have not yet been disclosed.
A spokesperson for the airline said these will be announced closer to that date.
The number of Ryanair aircrafts at Shannon Airport will now be reduced from four to three, while Dublin Airport has also been affected by the cut.
Mr O'Leary said these aircraft will be switched to bases in Belgium, Holland, Greece and Spain.
At the end of March, routes to Berlin, Gdansk, Katowice, London Luton and Newcastle were axed from Shannon, resulting in the transfer of over 100 Ryanair jobs to other bases.
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