Given the tight labor market for pilots, Ryanair has a weak hand. The low-cost airline needs to use a third-party moderator and make some concessions if it wants to avoid strikes in several countries expected on August 10 and beyond.
Ryanair Holdings Plc faces the worst strikes in its three-decade history on Friday after German pilots said they’ll join a protest aimed at forcing the discount carrier to increase pay and improve working conditions.
The Irish company will scrap more than 400 flights, disrupting travel for about 55,000 people, marketing chief Kenny Jacobs said Wednesday after the Vereinigung Cockpit union announced that members will walk out for 24 hours. Pilots in Belgium, Sweden and Ireland are already striking that day.
Ryanair has shown no willingness to improve salaries, acknowledge seniority or ease up on requirements for pilots to move between bases as it sees fit, union negotiator Ingolf Schumacher said in Frankfurt, adding that the carrier needs to accept that personnel costs will rise and productivity fall.
The company hit back saying it won’t bow to demands that would jeopardize the low cost base that’s made it Europe’s dominant carrier on short-haul routes. The cancellations will extend weeks of turmoil at the height of the summer season, with disruption surpassing the 300 daily flights scrapped when cabin crew in Spain, Italy, Portugal and Belgium walked out lost month.
Shares of Ryanair traded 1.6 percent higher at 13.68 euros as of 2:55 p.m. in Dublin, paring declines this year to 9.1 percent and valuing the company at 15.7 billion euros ($18 billion).
Schumacher said earlier that pilots are “not nomads who set up their tents where Ryanair is smelling business” and that home bases established in contracts should not be changed unless employees agree to the move.
The union said its members will strike from 3:01 a.m. on Aug. 10, giving Ryanair less than 48 hours to plan for the disruption. Previous walkouts have come with longer notice periods, allowing the carrier to modify its timetable to minimize the impact.
The carrier responded by canceling 250 flights in Germany, on top of 146 already scrapped following notice of walkouts in the other three countries. Ryanair has been roiled by walkouts as staff seek to extract maximum concessions after the airline agreed late last year to recognize unions following a staffing crunch that led to a truncated timetable.
Chief Operations Officer Peter Bellew called the Vereinigung Cockpit demands “ridiculous,” while saying that strikes are “part of the drama” of negotiations and added that the Dublin-based company remains committed to recognizing unions and engaging in constructive talks.
Ryanair had already advised investors to brace for increased disruption on Friday, saying on Aug. 1 that it expected German pilots — and those in the Netherlands — to join the walkout. A Dutch Airline Pilots Association spokesman said Wednesday that the union, which has a strike mandate from members, hadn’t decided on a date for action.
While German pilots staged a brief strike in December and Irish crews walked out last month, this week will mark the first time that the carrier has grappled with industrial action by flight crew in several countries on the same day.
The summer of labor strife is starting to take a toll on Ryanair, where passenger growth slumped to the slowest pace this year in July. The carrier also posted a 20 percent drop in profit for the three months through June and warned that the strikes and walkouts by air traffic controllers in southern Europe are making customers wary of booking.
–With assistance from Ellen Proper and Tami Holderried.
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Photo Credit: Vereinigung Cockpit union leadership holds a press conference in Frankfurt am Main on Aug. 8. Ryanair faces strikes on Friday in a four-nation protest aimed at forcing the carrier to increase pay and improve working conditions. Frank Rumpenhorst / DPA via Bloomberg
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