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EU Wants Competition In Ireland

by 2Paragraphs in Daily Edition | March 14, 2013

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Rumor has it that Irish low-cost airline Ryanair is about to buy somewhere between 150 to 200 Boeing 737 passenger jets. Sticker price for one: $89m. Large order discount price: $40m. So 170 would cost about $6.8 billion. News is supposed to break on St. Patrick’s Day when Irish Prime Minister Enda Kenny will visit President Obama at the White House. (Once again, Obama gets to look so fly.)

Ryanair (founded in 1985) is also looking for other ways to grow. It has launched three bids to take over the country’s oldest carrier, Aer Lingus (1936), each rejected by the latter’s board, citing–among other things–potential troubles about a monopoly. So to satisfy regulatory concerns, Ryanair offered to create a new carrier with British airline Flybe (to be named Flybe Ireland), ensuring consumers have choices. But that didn’t fly with the European Commission, which blocked the effort–to the great disappointment of Flybe, which would have received nine aircraft, 43 routes, and 100 million euros ($129 million) in cash. Europe may be hurting for cash, but the EC is convinced that greater competition, not consolidation, is the answer in Ireland–no matter how tempting liquid investment from industry titans may look in the short term. In fact, this week the European Union will discuss the best way to restructure Ireland’s rail market. “Ireland is the only country in the EU which has been allowed to retain a single operator (private company Iarnród Éireann) which regulates, operates and maintains its mainline rail network.”

 

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