Ryanair threatened on Wednesday to stop serving ten French regional airports from January 1 if higher taxes on the airline sector are included in the 2025 budget.
“Ryanair is currently reviewing its French plans and plans to reduce capacity to and from French regional airports by up to 50% from January 2025 if the French government continues its short-sighted plan,” said the low-cost carrier’s commercial director. Irish cost of Ryanair. Jason McGuinness, quoted in a press release.
Beauvais and Vatry would not be interested
Ryanair currently serves 22 airports in France, including two close to the Paris region: Beauvais (Oise) and Vatry (Marne). The regional airports affected by the end of operations would therefore be among the other 20. Ryanair did not name any of them on Wednesday.
The company also would not say how much its total supply in France would be reduced if it carried out its threat. It hopes to carry 5.7 million people there this year, a 19% increase over 2023.
Seeking funds to reduce a larger-than-expected budget deficit, the government included in the 2025 Finance Bill (PLF) a tripling of the solidarity tax on airline tickets (TSBA) and an increase in taxation on private jet passengers, for a total of one billion euros.
“The impact of the tax increase on passengers will be very damaging for regional France, which depends on competitive access costs,” said Jason McGuinness, estimating that this increase “will make many routes to and from regional France unviable.” .
How might other airline companies respond to Ryanair’s threats regarding tax increases in France?
Interview between Time.news Editor and Airline Industry Expert on Ryanair’s Threat to French Airports
Time.news Editor: Good day, everyone. Welcome to another insightful interview on emerging trends in aviation. Today, we’re delving into some potential turbulence in the airline industry, particularly concerning Ryanair’s recent threat to scale back operations at French regional airports. Joining us is Dr. Claire Dubois, an expert in airline economics and regulatory policies. Claire, thank you for being here.
Dr. Claire Dubois: Thank you for having me! It’s great to be here to discuss these critical developments in the aviation sector.
Editor: Let’s get right into it. Ryanair has announced its intention to potentially discontinue services to ten French regional airports. What are the key factors motivating this threat?
Dr. Dubois: Ryanair’s threat comes in response to proposed increases in taxes on the airline sector as part of the French government’s 2025 budget. The airline industry operates on thin margins, and any increase in operational costs can lead to significant shifts in business strategy, particularly for a low-cost carrier like Ryanair, which relies on low fares to attract passengers. By potentially cutting capacity by up to 50%, they are signaling their willingness to adapt aggressively to an unfavorable regulatory environment.
Editor: It sounds like Ryanair is using this as a negotiating tactic. How effective do you think this approach can be in influencing government policy?
Dr. Dubois: It can be quite effective, especially given the economic importance of air travel to local economies. By threatening to withdraw services, Ryanair puts pressure on regional authorities to reconsider tax increases, knowing that reduced flights may lead to fewer tourists and hinder economic growth in those areas. Moreover, Ryanair has a history of leveraging its position to negotiate better terms from governments, so this tactic is part of a larger strategy to maintain a competitive edge.
Editor: That’s really interesting. You mentioned the impact on local economies. Can you elaborate on what consequences this might have for those French regional airports?
Dr. Dubois: Absolutely. Many regional airports depend heavily on low-cost carriers for passenger traffic. If Ryanair were to reduce its capacity, these airports could see a significant decrease in travelers, which would affect local businesses, hospitality sectors, and even job markets. Moreover, it might limit travel options for residents in those regions, making it more difficult and expensive to reach major cities or destinations, thereby diminishing the appeal of those regions for both business and leisure travelers.
Editor: Given these potential outcomes, how should the French government balance tax revenue needs with the health of the airline sector?
Dr. Dubois: It’s a delicate balance. While governments do require revenue from industries, they also need to consider the broader economic implications of their tax policies. Consultation with industry stakeholders like airlines and airports can provide valuable insights. Perhaps a phased approach to tax increases, or incentives for maintaining routes and capacity, could be a more sustainable solution that allows the government to meet revenue goals without jeopardizing vital air connectivity.
Editor: That’s an excellent point. It seems like a situation that requires careful navigation. What do you anticipate Ryanair’s next steps will be if the government decides to proceed with the tax increase?
Dr. Dubois: If the French government goes ahead with the proposed taxes, I wouldn’t be surprised to see Ryanair follow through on its threats, which could lead them to divert resources to more profitable markets. They might also seek to bolster their operations in neighboring countries with more favorable tax structures. It’s also possible that we could see a public relations campaign aimed at shaping public opinion around the proposal’s potential negative impacts, further pressuring the government to reconsider.
Editor: Thank you, Claire, for sharing your insights on this evolving situation. It sounds like we’re heading into a critical period for air travel in France. We appreciate your expertise and your time today.
Dr. Dubois: Thank you! It was my pleasure. I look forward to seeing how this situation unfolds.
Editor: And to our viewers, stay tuned for more updates on this story and all things aviation. Thank you for joining us today!