beyondbrics

Ryanair, the Irish no-frills airline, on Tuesday boasted of its “phenomenal” success in ticket sales for newly-announced flights serving Budapest, in the wake of the collapse of Malev, the Hungarian flag carrier.

It also stepped up its attacks on Wizz Air, its chief rival in the local market. It alleged that Wizz Air’s ownership structure violated European Union rules – a claim swiftly denied by Wizz.

Mixed into this heady mixture was news of a €1m marketing campaign to boost ticket sales in Hungary, the possibility of yet more aviation sector jobs for Budapest and the promise of bikini-clad hostesses to see off the first Ryanair passengers on February 17 – if they can stand the sub-zero temperatures.

But first, the seriously serious stuff.

Michael Cawley, Ryanair deputy chief executive, told a packed press conference in Budapest that the airline was asking the European Commission investigate the ownership structure of Wizz Air, which Ryanair believes does not comply with EU rules stipulating that non-EU investors cannot hold controlling stakes in airlines within the Union.

Revealing a diagram of what he said was the Wizz Air ownership structure, he said it led via three Malta-based trusts to a Stuart Blackburn at the apex. However, Cawley said “we have reason to believe it is [ultimately] held by [other] owners who are not European.”

This would be in breach of EU rules and “they [Wizz Air] may not operate on that basis in Europe,” he said.

Quizzed by journalists as to who the mysterious ultimate owner might be, Cawley said: “I am not at liberty to reveal that. But, if it’s not true, Wizz Air can deny it this afternoon. I think they’ll have great difficulty denying it,” he said.

Wizz Air responded:

Ryanair’s allegation concerning Wizz Air’s ownership structure is, as with a number of other statements made by Ryanair over the past few days, factually incorrect.

In 2010 – and in response to a previous complaint made by Ryanair – the European Commission accepted the ownership structure as being compliant with EU rules. The ownership structure has not changed since that time. For the record, over 96% of our shares are owned by European Union nationals.

Wizz Air remains focused on doing what we do best—flying passengers to their preferred destinations, delivering a great service for a great price.

Meanwhile, back to the business of flying. Cawley said Ryanair had sold 45,000 tickets on Budapest routes in a fortnight. “The results are excellent, and we are confident we will reach 2.4m passengers this year,” he said, adding that more flights would be considered when aircraft become available.

Ryanair’s €1m marketing drive now underway would include €500,000 in sales promotion, €450,000 in print and broadcast advertising and €50,000 in on-line advertising. A Magyar-language website would be launched ‘hopefully” next week, he said.

Ryanair had met “over 300” former Malev staff in the past fortnight and was scheduling 100 assessment tests for potential recruitment. Cawley dismissed the possibility of any Malev revival, saying it was an outdated model.

However, having discovered the Malev flight simulator at Budapest Airport and found it “perfect” for training its own pilots, Ryanair was weighing up Budapest’s potential as a permanent training base, he said.

Then grabbing his travelling case – “It’s about 10kg, it’s not checked in luggage, and it’s good enough for a week” he insisted – Cawley and his budget basement team of two assistants hurried away for government talks.

Related reading:
Hungary’s Malev will be missed, beyondbrics
Budapest airport: Ryanair pick up passengers, but who picks up the tab?beyondbrics
Ryanair vs Budapest: playing dirty? beyondbrics
Ryanair and Budapest Airport: setting the record straight, beyondbrics