Ryanair considers pay freeze as fuel costs surge 2bn euros

Summarised from 5 outlets · Updated 2 Nov, 08:53 · Archive

Ryanair is considering temporary pay freezes for staff to offset a forecast 2bn euro rise in fuel costs.

Ryanair is considering temporary pay freezes for staff and greater use of artificial intelligence to help offset a forecast 2bn euro jump in fuel costs in the year to March 2028. The Dublin-based airline says jet fuel prices are expected to remain elevated well into 2027 because of the continued conflict in the Middle East.

The carrier currently has 80% of its jet fuel hedged at lower prices than current market rates. However, these hedges will expire following the end of its financial year, exposing it to much higher unhedged fuel costs. The price of the airline's 20% unhedged jet fuel has already doubled. Jet fuel is currently trading at approximately 170 dollars a barrel.

Ryanair's half-year profit fell 15% to 2.15bn euros for the six months to the end of September, largely due to higher fuel costs and increased operating expenses which rose by 10%. The airline says it expects European short-haul airfares to increase materially to reflect higher fuel prices.

Ryanair's chief executive Michael O'Leary told CNBC that European airfares could rise by 10% to 20% next year. However, the airline does not expect fare increases to fully offset the fuel cost surge, and is therefore reviewing all costs including labour agreements and crew ratios.

The airline said it will also examine increased use of artificial intelligence to drive operational, back-office and support function productivity. In September, Ryanair cut its full-year traffic target from 216 million to 214 million passengers in an effort to reduce exposure to unhedged fuel costs during winter.

How it is being reported

• Airline ticket prices will go up next year says Ryanair as it reveals its fuel bill will rise by £1.6bnEuropean airlines will raise their ticket prices next year to offset the sharp rise in fuel costs which have surged following the Middle East conflict, Ryanair warned.This is Money · 2 Nov, 09:24
• Ryanair considers pay freezes and reducing crew on flights as fuel costs soarAirline also weighs up increasing use of AI as part of cost-cutting measures to offset impact of Iran war Ryanair is considering cost-cutting measures including implementing pay freezes, reducing crew on flights and increasing the use of AI to offset soaring fuel costs because of the Middle East conflict . Europe’s biggest low-cost carrier said it expects European airlines to raise their ticket prices by as much as 20% , as it anticipates its jet fuel costs will increase by about €2bn (£1.6bn) in its next financial year, which ends in March 2028. Continue reading...Guardian World · 2 Nov, 09:06
• Ryanair CEO warns fares could rise by up to 20% in 2027 as fuel bill jumps by $2.2 billionRyanair's CEO Michael O'Leary told CNBC that European airlines may have "significantly higher airfares" of up to 20% next year as fuel costs rise.CNBC · 2 Nov, 08:42
• Ryanair to review pay freezes and AI use to counter jet fuel price surgeThe Dublin-based airliner said it was predicting a jump of roughly two billion euros in its fuel bill for the year to March 2028.Independent Business · 2 Nov, 08:32
• Ryanair may freeze workers' pay as fuel prices spikeThe airline says fuel prices may rise by €2bn in 2028 unless there is an end to the US-Israel war with Iran.BBC News · 2 Nov, 08:06

In this story: Ryanair · Michael O'Leary · Europe · Middle East · Dublin

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