Losses force 25% reduction
Aer Lingus has today (June 12) announced it is to slash capacity by up to a quarter, blaming heavy losses and falling demand.
According to an official statement, routes from Dublin to San Francisco and Washington will cease on October 25, and its flights between Shannon and Boston will be reduced from seven to four per week.
Reports in the Irish press claim Aer Lingus will announce further cuts imminently. Services from Shannon to New York and Chicago are also expected to be dropped.
The cuts will affect Aer Lingus' winter schedule. It is unclear whether the routes will be reinstated after the winter season.
"We are also taking action to effectively manage capacity; adding short haul frequency and routes at Shannon and Gatwick and reducing capacity in Dublin and Belfast," Aer Lingus' chairman Colm Barrington said in a statement.
Aer Lingus is understood to be cutting services in a bid to save on costs. The airline reported a pre-tax loss of €105m in March, prompting a sharp drop in share value (see ABTN News Mar 11 [1]).
Ryanair spokesman Stephen McNamara said: "Ryanair regrets the cut backs at Aer Lingus as they represent a step backwards not forwards.
"Today's announcement highlights the mistake the board and the government made when they rejected Ryanair's January offer which promised to double the Aer Lingus fleet to over 60 aircraft, thereby creating 1,000 new jobs.
"Ryanair believes that getting bigger not smaller is the ‘right size' for Aer Lingus."
Ryanair holds a 29.82% stake in Aer Lingus after two takeover attempts, the most recent of which ended in January.
Last week Ryanair reported a 78% drop in full year profits after writing down its investment in Aer Lingus at a cost of around €300m.
Aer Lingus' share price has dropped from around €1.60 in January to €0.59 at close of trading yesterday. Ryanair's latest offer priced Aer Lingus at €1.40 a share.
www.aerlingus.com [2] www.ryanair.com [3]