Aer Lingus sell

shannon_tek

Reading the news about EI. And how they are Wary of a monster Airline taking them over. But what would it mean if the International Airlines Group Were to take them over.

They seem to have done a good job so far with Iberia. Would this be a harm to have, would it kill Aer Lingus as an Independent Company or would it just step up competition against our second carrier Ryanair.

Personally IMO i would like to see I.A.G take AL. Could we trust them not to wipe AL off the maps. Also could AL benifit from such an Alliance ie. Extended routes. :pac:

Source

Foggy43

I think David086 gave all the info you need here a few pages ago

http://www.boards.ie/vbulletin/showthread.php?t=2056392955

drdeadlift

I didnt think ib were doing well.

Bessarion

shannon_tek wrote: »

Reading the news about EI. And how they are Wary of a monster Airline taking them over. But what would it mean if the International Airlines Group Were to take them over................ Would this be a harm to have, would it kill Aer Lingus as an Independent Company or would it just step up competition against our second carrier Ryanair.

Personally IMO i would like to see I.A.G take AL. Could we trust them not to wipe AL off the maps? Also could AL benifit from such an Alliance ie. Extended routes. :pac:

Well IAG are looking to expand but so far have poo pooed any desire for EI. I feel that a acquisition by IAG would stifle any opportunity for growth by EI out of Dublin, IAG may want EI to act as a feeder airline into the large BA/IB hubs.

If you read some more of the statements by the EI CEO this week you will see the logic behind his stance. Being taken over by 1 of the large airlines would mean being absorbed into their alliance (IAG=OneWorld, Lufty=Star, AF/KLM=SkyTeam) Mueller states that currently EI have 3 profitable agreements with each of the 3 big alliances (codeshares with BA/United and KLM) By joining 1 alliance you effectively end any agreement with the other 2, maybe not imediately but at definitely at some point.

In addition joining an alliance has hidden costs; some stipulate you must upgrade your online booking system to their alliance standards, you may have to re-introduce business class on shorthaul flights, you may need to have a certain standard of business class lounge in ALL airports, etc. With this in mind joining an alliance may not benefit EI overall.

Mueller states that for EI their "neutrality is one of our best assets", a takeover (however benign) would threaten that neutrality. Thus he has stated that a takeover/buyout by a non-airline investment group would be a better option for EI as is currently stands.

L1011

Business on *some* shorthaul seems to be a Mueller target though.

goat2

i travelled with aer lingus about a week ago, i could not understand why there were big cases and bags let on board, i thought they should have been in cargo hold. and that we are allowed one handluggage at a certain size, i had one case and one handluggage, and my case was in cargo hold, yet it was smaller than most of the items people were bringing on board, and my case would have been too big to pass off as hand luggage, how and why is this happening

David086

goat2 wrote: »

i travelled with aer lingus about a week ago, i could not understand why there were big cases and bags let on board, i thought they should have been in cargo hold. and that we are allowed one handluggage at a certain size, i had one case and one handluggage, and my case was in cargo hold, yet it was smaller than most of the items people were bringing on board, and my case would have been too big to pass off as hand luggage, how and why is this happening

What's this got to do with the sale of Aer Lingus I think you need to go to the travel forum for that

L1011

goat2 wrote: »

i travelled with aer lingus about a week ago, i could not understand why there were big cases and bags let on board, i thought they should have been in cargo hold. and that we are allowed one handluggage at a certain size, i had one case and one handluggage, and my case was in cargo hold, yet it was smaller than most of the items people were bringing on board, and my case would have been too big to pass off as hand luggage, how and why is this happening

Aer Lingus don't enforce the cabin baggage size rules often (or ever, I'm a frequent traveller with them and I have NEVER seen it enforced, in DUB/MAN/BHX/LGW/LHR/AMS)... however, that's not relevant to the thread.

Doirtybirdy

According to sky news business today,Iag has put in a bid for bmi.
So we are either going to soon see Ba birds back in Dublin flying into T5 or the bmi dub-lhr slots will go.

I'm hoping the former as it's well known that Ba just don't have the need for all the bmi slots-there is hope that they can see merit in keeping some of the dub-lhr route

kona

goat2 wrote: »

i travelled with aer lingus about a week ago, i could not understand why there were big cases and bags let on board, i thought they should have been in cargo hold. and that we are allowed one handluggage at a certain size, i had one case and one handluggage, and my case was in cargo hold, yet it was smaller than most of the items people were bringing on board, and my case would have been too big to pass off as hand luggage, how and why is this happening

Because they are not a **** airline like ryanair.

Blue Punto

kona wrote: »

Because they are not a **** airline like ryanair.

I have travelled on EI eight times this year with possibly another four flights to go before january.
On all but one flight I to was amazed at the amount of hand luggage people were getting away with boarding the aircraft.
On one flight to LHR a passenger came on with case a laptop bag and a large sports type holdal.
This may seem all well and good but when you take into account the amount of pax on a aircraft and the amount of overhead room in the bin above your head it is unfair to other passengers.
On a flight from Madrid to Dublin I sat in seat 1a which ment I had to place everything I had in the overhead bin which was one bag and a laptop case.I had to stop an idiotic piece of SLF from forcing their oversize bag into the bin ontop of my laptop and when the flight attendant saw this she told him the bag was to big and it had to go in the hold.

Margins are tight in aviation these days and you find unexperienced travellers bringing alot of luggage with them that they will not need,in which case they should be charged and it placed in the hold.

I know of people who have gone on 2 weeks holidays with enough clothes to last 6 months

Alot of airlines are doing this charge for luggage nothing to do with being a EI or FR

AfterDusk

kona wrote: »

Because they are not a **** airline like ryanair.

You do realise that he's complaining about Aer Lingus?

At least proper airlines, like Ryanair, enforce the rules properly & everyone follows the same rules. Unlike Aer Lingus where people get on with bags the size of small houses - it's an insult to those who stick to the T&Cs that they've agreed to.

L1011

Blue Punto wrote: »

I have travelled on EI eight times this year with possibly another four flights to go before january.
On all but one flight I to was amazed at the amount of hand luggage people were getting away with boarding the aircraft.
On one flight to LHR a passenger came on with case a laptop bag and a large sports type holdal.
This may seem all well and good but when you take into account the amount of pax on a aircraft and the amount of overhead room in the bin above your head it is unfair to other passengers.
On a flight from Madrid to Dublin I sat in seat 1a which ment I had to place everything I had in the overhead bin which was one bag and a laptop case.I had to stop an idiotic piece of SLF from forcing their oversize bag into the bin ontop of my laptop and when the flight attendant saw this she told him the bag was to big and it had to go in the hold.

Margins are tight in aviation these days and you find unexperienced travellers bringing alot of luggage with them that they will not need,in which case they should be charged and it placed in the hold.

I know of people who have gone on 2 weeks holidays with enough clothes to last 6 months

Alot of airlines are doing this charge for luggage nothing to do with being a EI or FR

You realise Ryanair would have charged *you* as well? "one bag and a laptop case"...

kona

So hes complaining that Aer Lingus are not such utter pricks about luggage as ryanair are??


Most of the time I put my bag under the seat infront. No need to use the overhead bins.

If you want to be charged for your luggage then fly with ryanair. If youd rather a airline take a more common sense approach then fly with Aer Lingus.

If you feel hard done by that somebody got a bigger bag on than you without paying, then its a *little* childish IMO.

Proper Airlines dont carry on like Ryanair Do, they dont get told to **** off by the two biggest manufacturers is the world, they dont do stupid publicity stunts like put bigger tits on the girl at the back of the Harp, they dont write "latethansa" on the side of their aircraft, they dont buy 30% of a rival airline and throw a hissy fit demanding dividends just because they didnt get what they wanted, they dont call their staff in on the chance they "may" get paid, they dont have their staff PAY for a application or rent their uniforms. And their CEO aint a media whore.

cson

@ kona; I guess 'proper' and 'profit' are not one and the same in your book. Because only one the airlines mentioned has had well over a decade of sustained profitability. A proper airline in terms of how to run a business perhaps.

L1011

cson wrote: »

@ kona; I guess 'proper' and 'profit' are not one and the same in your book. Because only one the airlines mentioned has had well over a decade of sustained profitability. A proper airline in terms of how to run a business perhaps.

Ryanair have had both quarters and an entire year-end loss in the past decade.

cson

I suppose my 'sustained' is your 'constant' MYOB. Nevertheless the point I was trying to make need I outline it further is that Ryanair have been extremely successful as a business sustaining profits over a decade [though as you point out, it has had its interuptions] whereas Aer Lingus has not - last year was its first profitable year in 4. The likes of enforcing cabin baggage terms is a little microscopic glimpse into why one airline is worth a vast multiple of the other.

L1011

Aer Lingus has the ability to be profitable without needing to bring in Ryanair levels of cattle treatment for pax. Don't see IAG or AF-KLM doing anything of the sort, do you?

Poor management and very poor decisions made by said are the reason for non-profitability.

shannon_tek

Why is Ryanair always compared and shot down. Yes Michael O'Leary!! has made a lot of bad decisions while working at the company.
Ryanair! the company is not bad. When you speak of Ryanair you are talking about MO'L's planes, " routes and " staff. When in fact they have done nothing wrong. What they are doing is working for their money. They are implementing the Terms and Conditions that come when you fly with Ryanair Outlined by Michael O'Leary.

But.. While MO'L may seem mean and harsh. He is wise. He is a real business man. As pointed above Ryanair make money through planning and negotiation as Mo'L excels at. He wont settle till he is happy.

Another Reason Ryanair do so well is because They are not on strike every second day like Aer Lingus who kick up a fuss over a cent being deducted. spoiled is what i call that. Yes it is a though F*^% world we live in. But many people would be glad to see the sight of any sort of money coming their way.

Im trying to find Ryanair on Strike but all i get is profit from everyone else being on strike. To me that seems like one hell of an Airline to work for. Tough but profitable. If Aer Lingus didnt spend so much time on the ground arguing over BS im sure they could have been just as profitable in their 75years of Flying.

Im sure none of you will agree with the above. But im quite sick of reading about stupid things. Yes i give out but think i'll stop it. Im happy to fly with anyone If i have to put up with the Irish government i can put up with a smart a55 of a man and to be honest i admire Mo'ls skills and i think he and inspiration that many business people can follow. Unfortunatly he doesnt give Ryanair a great name which was founded by Tony Ryan a man from limerick. who worked in shannon. who's house i got to visit. ha ha. :pac: Epic life ive live.

cson

MYOB wrote: »

Aer Lingus has the ability to be profitable without needing to bring in Ryanair levels of cattle treatment for pax. Don't see IAG or AF-KLM doing anything of the sort, do you?

Poor management and very poor decisions made by said are the reason for non-profitability.

Ryanair is a an example of a very effective business model and I think it's quite disingenuous to use 'cattle treatment' as a description - they provide a reliable and value product. I don't think anyone is under any illusions as to the Ryanair product at this stage.

Aer Lingus won't have the ability to be profitable until it deals with its quite substantial pensions issue, that allied to a reliability question courtesy of the various strikes in the past year mean it's going to skirt the profit/loss divide for a few more years yet. Mueller has done quite a good job so far though.

Personally I would find it illuminating that the examples you have used are those of merged legacy carriers; mergers that were essentially a product of wanting survival security.

But hey, I guess we all yearn for a return to the romance of flying.

MoeJay

http://www.air-scoop.com/pdf/Ryanair-business-model_Air-Scoop_2011.pdf

This might give all of us some enlightenment about how much money FR actually make in the bit where they fly you from (somewhere near) A to (somewhere near) B.

lintdrummer

There are a number of things that people tend to forget when they compare Aer Lingus with Ryanair. The most obvious being that Aer Lingus has only been a private company for 5 years, in that sense it may as well be viewed as a "new" airline, because up to that point it could afford to be ineffeicient and unprofitable.

People harp on about the company's inability to show stable profit making over the last decade. Look at it this way: The market has been extremely difficult over the last decade. The industry as a whole has seen it's fair share of turmoil. Up until 2006 the company, as a mostly state owned entity, could afford to run at a loss. Since 2006 strategies have been implemented that are seeing the company run more efficiently and slowly return to profit. Legacy issues take time to weed out. To be fair it's little short of a miracle that Mueller has made a substantial profit in 2010 and will make equally substantial profit this year considering what he was landed with upon his arrival and the current global economic situation.

This company with it's current business model are in it's infancy and at the moment the signs are very good indeed. Anyone that judges the company from anytime before 2006 is judging something that doesn't exist anymore and is wasting their breath.

On the issue of a sale I don't see any airline taking a large shareholding in Aer Lingus. Why would a profit making company with large cash reserves forego their independence by allowing a large airline to take over? It doesn't make sense. Aer Lingus don't need a buy out.

The pension issue is of course what has everyone talking. It's the predominant reason that shares have such little value. It's the last hurdle before the airline can truly get out of the mire that it has been in up to now. I for one am very interested to see the outcome of that situation.

Hannibal

lintdrummer wrote: »

There are a number of things that people tend to forget when they compare Aer Lingus with Ryanair. The most obvious being that Aer Lingus has only been a private company for 5 years, in that sense it may as well be viewed as a "new" airline, because up to that point it could afford to be ineffeicient and unprofitable.

People harp on about the company's inability to show stable profit making over the last decade. Look at it this way: The market has been extremely difficult over the last decade. The industry as a whole has seen it's fair share of turmoil. Up until 2006 the company, as a mostly state owned entity, could afford to run at a loss. Since 2006 strategies have been implemented that are seeing the company run more efficiently and slowly return to profit. Legacy issues take time to weed out. To be fair it's little short of a miracle that Mueller has made a substantial profit in 2010 and will make equally substantial profit this year considering what he was landed with upon his arrival and the current global economic situation.

This company with it's current business model are in it's infancy and at the moment the signs are very good indeed. Anyone that judges the company from anytime before 2006 is judging something that doesn't exist anymore and is wasting their breath.

On the issue of a sale I don't see any airline taking a large shareholding in Aer Lingus. Why would a profit making company with large cash reserves forego their independence by allowing a large airline to take over? It doesn't make sense. Aer Lingus don't need a buy out.

The pension issue is of course what has everyone talking. It's the predominant reason that shares have such little value. It's the last hurdle before the airline can truly get out of the mire that it has been in up to now. I for one am very interested to see the outcome of that situation.

The two issues highlight are major problems with Aer Lingus. There's too many people on legacy pay and in a sense too many chiefs and not enough indians. This could take upto another ten years to solve as most of these people have to be either paid off or wait for them to retire.

Ryanair already hold just over 29% of Aer Lingus, so I doubt it's easy when your biggest competitor holds such a big share. I doubt Aer Lingus will be sold because of the slots it holds at major airports like Heathrow, JFK etc are of strategic importance to the Irish government and people because they're critical for imports, exports, trade, tourism etc..

I've heard rumours before that there has been votes of no confidence in Mueller from the board as him and Barrington don't like each other plus todays allegations in the Sunday World won't do Mueller much good if proven true.

bladeruner

Dotsey wrote: »

I've heard rumours before that there has been votes of no confidence in Mueller from the board as him and Barrington don't like each other plus todays allegations in the Sunday World won't do Mueller much good if proven true.

What were the allegations in the Sunday world?
Never heard the rumours that barrington and mueller didn't get on.
Based on performance to date, I'd rate Mueller alot higher then Barrington.
Mueller looks like he's doing a good job which validates my theory that governing Ireland is probably best left to those from outside the country.

L1011

cson wrote: »

Ryanair is a an example of a very effective business model and I think it's quite disingenuous to use 'cattle treatment' as a description - they provide a reliable and value product. I don't think anyone is under any illusions as to the Ryanair product at this stage.

Aer Lingus won't have the ability to be profitable until it deals with its quite substantial pensions issue, that allied to a reliability question courtesy of the various strikes in the past year mean it's going to skirt the profit/loss divide for a few more years yet. Mueller has done quite a good job so far though.

Personally I would find it illuminating that the examples you have used are those of merged legacy carriers; mergers that were essentially a product of wanting survival security.

But hey, I guess we all yearn for a return to the romance of flying.

"Reliable" and "value" don't remove the cattle transport elements of it, and EI are already profitable - you may want to check figures before claiming things. Like claiming FR to be continually profitable and redefining what you meant post-facto.

Hannibal

bladeruner wrote: »

What were the allegations in the Sunday world?
Never heard the rumours that barrington and mueller didn't get on.
Based on performance to date, I'd rate Mueller alot higher then Barrington.
Mueller looks like he's doing a good job which validates my theory that governing Ireland is probably best left to those from outside the country.

The board as a whole like Mueller because he's saving the company money but Barrington and him don't like each other.

I haven't seen the article but the rumours are that Mueller "senior management" and a recently promoted member of cabin crew were having an affair and in return he influenced her promotion. He has an injunction out against her selling her story etc.. They were spotted by a pilot who reported them to HR and then provided the proof. Interesting to see how this pans out because I heard his contract is up sometime this month or next month

H6

Moving back on topic....

FT are reporting that Ethiad are in talks with the government about buying their 25% stake in EI.

Things might be about to get interesting.


http://on.ft.com/qnSy9n

Eleganza

If ETHIAD buy the airline with a view to using the prime slots Ireland could be a reduction in the quality of service in to the major european hubs/routes by ETHIAD taking many of the slots and putting larger A321 and A330 planes on the Irish routes.
The net number of seats from Ireland to these hubs may not reduce but choice of flight time will be less.
I'm not sure how bad a thing this would be. Not good but perhaps not so terrible.

alan85

Eleganza wrote: »

If ETHIAD buy the airline with a view to using the prime slots Ireland could be a reduction in the quality of service in to the major european hubs/routes by ETHIAD taking many of the slots and putting larger A321 and A330 planes on the Irish routes.
The net number of seats from Ireland to these hubs may not reduce but choice of flight time will be less.
I'm not sure how bad a thing this would be. Not good but perhaps not so terrible.

You mean taking 1 of the 3 services per day into Paris or 1 of the 2 services per day into Frankfurt???

I don't think Etihad are going to buy an airline just to take a couple of slots. The only hub that would matter would be Heathrow and I think the governmnet would protect those accordingly before selling. If slots were their main objective I'd imagine they'd actively chase BMI moreso... Aer Lingus isn't a bad investment. Ireland would be a nice enough market to get some share in. One thing that worries me regards Aer Lingus is its lack of connectivity eastbound. If Etihad did buy EI that would be that sorted.

Eleganza

I think that if Govt. are desperate enough for money they'll sacrifice slots and claim that the seat count in to and out of the hubs has not dropped.
If the financial position of Aer Lingus disimproves over the next few quarters then don't underestimate just how cynically Govt will approach the issue just to be rid of what they will then view as a millstone around their necks rather than strategic infrastructure.

Tenger

Eleganza wrote: »

I think that if Govt. are desperate enough for money they'll sacrifice slots and claim that the seat count in to and out of the hubs has not dropped.

I see your logic. however the only really valuable slots that EI have are those of LHR. Now EI have at least 10 return flights per day between DUB-LHR, and maybe 3-4 from each of ORK,SNN,BFS. Lets guess that EY take 1 from each of the small bases and 2 from DUB. 5 slot pairs in LHR is quite valuable, yes EI lost a bit of frequency but they gain Eastwards connectivity via Abu Dhabi, this gain may actually reduce the overall demand on the LHR route, due to pax being routed differently.

Other Euro hubs that EI fly into (FRA, CDG, AMS, MUC, MAD)do not have the same level of slot restriction as LHR so there is less incentive for EY (or any other trade buyer) to make a grab for them.

From an EI point of view as EY are not aligned with an alliance, such a purchase would not impact too much on their existing codeshare agreements (with UA, BA, B6, KL) In the most recent EI statement it was claimed that this 'neutrality' was to their advantage.