Ryanair boss Michael O'Leary warns of higher summer air fares for 2024

Chief executive Michael O'Leary said issues limiting the number of available aircraft mean European airlines will struggle to meet demand for travel during the peak season.

He predicted that Ryanair's ticket prices will be up to 10% more expensive this summer compared with the same period last year.

Mr O'Leary said this is because the carrier's growth in passenger numbers will be lower than expected because Boeing's new aircraft deliveries are being delayed.

Ryanair's original forecast for the year to the end of March 2025 was that it would carry 205 million passengers, up from 183.5 million during the previous 12 months.

Mr O'Leary told reporters at the carrier's Dublin headquarters: “With less aircraft, maybe we'll have to bring that 205 million down towards 200 million passengers. It might be a scratch below 200 million, we just don't know at this stage.

“That probably means that even our growth this year is going to be constrained in Europe, and I think that leads to a higher fare environment across Europe for summer 2024.”

He went on: “Fares in summer 2024 are going to be up again on summer 2023. Our average air fares in summer 2023 rose 17%. We don't think we'll see that kind of double-digit fare increase this year.

“We're doing our budgets based on a fare increase of 5-10%, which to me feels kind of reasonable.

“It could be higher than that, it could be lower than that, we don't really know. If capacity was growing, I think fares would be falling.”

Meanwhile, the owner of British Airways is set to report soaring sales last year, shrugging off fears that the UK’s recent recession has dented demand for holidays.

International Airlines Group (IAG), which also owns airlines Iberia, Vueling and Aer Lingus, will publish its financial results for 2023 on Thursday.

The aviation giant is expected to report sales totalling just shy of €30 billion (£25 billion), a record yearly amount for the group and more than a quarter higher than the prior year.

It follows IAG reporting record profits between July and September last year, the critical summer season, as it benefited from a boom in leisure travel.

The company flagged particularly strong demand for flights on its North and South Atlantic routes and top holiday destinations in Europe.

Analysts are expecting an underlying operating profit for the full year of about €3.5 billion (£3 billion), which would top its previous peak achieved in 2018.

Official figures showed that the UK fell into a technical recession at the end of the year, which is defined as two consecutive quarters of negative economic growth.

But major travel groups including Jet2 and Tui have noted in recent months that consumers have been prioritising hard-earned trips abroad despite seeing their incomes squeezed by the cost-of-living crisis.

Investors could be looking for similar reassurances from IAG, particularly that their bookings are holding strong against lower-cost rivals like easyJet, Ryanair, and Wizz Air.​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​