- Low-cost carrier will fund pro-EU campaign in U.K. newspapers
- CEO says terror and the weather bigger concerns than sterling
Ryanair Holdings Plc became one of the first companies to fund a campaign to keep the U.K. in the European Union on the grounds that a so-called Brexit would threaten growth, while saying the pound’s tumble since a date for a vote was set won’t crimp travel habits for most Britons.
Dublin-based Ryanair will run advertisements in U.K. newspapers Thursday calling on people to back EU membership in the June 23 referendum, Chief Executive Officer Michael O’Leary said at a briefing in London.
At the same time, O’Leary said the weakening of the pound isn’t likely to stop U.K. customers flying abroad. Sterling slumped the most since 2010 Monday after London Mayor Boris Johnson lent his support to the “Leave” campaign, putting him at odds with Prime Minister David Cameron, his party colleague.
“We’re going to actively campaign on this issue for the next three or four months,” O’Leary said in an interview Wednesday. “We’re going to bore everybody to death. We will also be campaigning with our passenger base, trying to influence people to vote in favor of Europe.”
Ryanair’s ads will feature the headline “Vote Yes to Europe” above an image of one of its jets flying over Big Ben and the Houses of Parliament as a red London bus sweeps by. The blurb tells readers that the EU is better for growth, jobs and tourism -- including both visitors and British holidaymakers.
Exchange rates aren’t a significant issue in determining levels of demand given the prices offered by discount carriers, the CEO said, with terrorist attacks and the weather far more likely to influence booking patterns.
“Currency movements have very little effect,” he said. “The key driver of travel plans at the moment is safety and security fears over North Africa and across into Turkey. Mass immigration through the Greek islands may have a bit of a turn-off effect.”
EasyJet Plc said it also sees no material impact from the weaker pound, given its pan-European network, adding that the development will “certainly make London a more attractive city break destination for shopping and culture for passengers from Europe.”
‘Wiping the Floor’
O’Leary said a vote to leave the EU would damage job creation in the U.K. and could make it less likely that Ryanair would invest there rather than in nations such as Ireland or Germany. Britain accounts for almost two out of every five Ryanair passengers, with Europe’s largest low-cost carrier expecting to attract 41 million customers there this year out of 106 million in total.
Ryanair is boosting capacity from London Gatwick airport by 80 percent this year after taking over operating slots that regulators forced British Airways-owner IAG SA to surrender following its purchase of Aer Lingus Group Plc.
O’Leary said the airport, the main operating center for EasyJet, could see aircraft stationed there -- giving it base status -- when the slots are used to add flights to Belfast and Dublin next winter.
“Nobody has responded more favorably to cheap travel than British citizens,” the Irishman said, adding: “As one of Europe’s most competitive economies Britain is wiping the floor with the French, the Italians and many of those other economies. Now is not the time to leave Europe, now is the time to stay in Europe and continue to benefit from membership.”
The leaders of the campaign to leave the EU, including Johnson, are “career politicians who don’t create jobs and are generally passengers when it comes to the economy,” he said.