Ryanair Close Belfast Base

The decision by Ryanair to close its Belfast base, was taken following a further delay to the public enquiry regarding the planned runway extension at Belfast City Airport (BHD). Belfast City currently has a runway length of just 1829(m) which has led to Ryanair operating with payload restrictions of approximately 16 seats on each rotation.

At the time of Ryanair signing the deal to operate at BHD, the airport was working towards planning permission to extend the runway, and no doubt the Ryanair deal was based upon this extension. With the lack of development, Ryanair has been left to operate domestic UK services and unable to serve international destination

Ryanair's decision to leave Belfast City will lead to the cancellation of five scheduled destinations. It currently operates 89 weekly frequencies: these are to Bristol (14 weekly), East Midlands (20), Liverpool (21), Glasgow Prestwick (7) and London Stansted (27). The news will come as a blow to BHD, as Ryanair is currently the second largest operator in terms of scheduled seat capacity, at an airport which according to November scheduled data, has just six scheduled operators. The table below illustrates the market share at Belfast City by carrier.

Source: Flightbase 14-20 November 2010

Belfast City Airport is the smaller neighbour of the larger Belfast International Airport, which also has a significant low-cost presence with carriers such as Jet2.com, Aer Lingus, bmibaby and easyJet having a presence there. Whilst Ryanair hasn't entered the Belfast International market, it has focused its operations at Belfast City (BHD), which is located closer to the heart of Belfast and it has left its fellow low-cost carriers to compete at Belfast International.

Ryanair faces no direct competion from Belfast City on its existing five routes, however all of these routes are operated from Belfast International with the exception of Prestwick, although easyJet serves Glasgow International.

CONSTRAINTS

Whist yields on offer at BHD were attractive due its proximity to the business district in Belfast, payload restrictions meant that Ryanair decided that its B737-800 will be better operated elsewhere with fewer operating restrictions.

Ryanair operating just a single unit at a base is unusual for Europe largest Low-cost operator which has a strategy of driving growth through increasing volumes of traffic at its bases. There is no doubt that in the optimum operating environment Ryanair would have stationed at least three aircraft at Belfast City

Additionally, Belfast City Airport operating hours are from 06.30 till 21.30. Ryanair seeks to operate from bases where there is the minimum of restrictions and thus the carrier is able to optimise its daily rotations, which is not the case at BHD given its locality to residential and business properties.

Ryanair will now look to alternatives to station this aircraft in Europe.

FLYBE

The Ryanair decision will be welcomed at Flybe headquarters. Flybe has seven based units at Belfast City and as a regional aircraft operator-has no need for an extension to the runway. It operates E-195 and Q400 equipment and will now be well postioned to take over some of the Ryanair routes that are will be cancelled.

Flybe will view this as an excellent opportunity to cement its position as the leading carrier at Belfast City. Flybe already serves Birmingham, Glasgow, Manchester and Glasgow, so is unlikely to replace Liverpool, East Midlands, Stansted and Prestwick, however Bristol would appear to be an opportunity.

The Ryanair decision has appeared to focus on the runway issue and commercial terms do not appear to be the issue, hence the carrier appears to be leaving on good terms with the door still open.