Ryanair says it may freeze workers’ pay and raise airfares

Ryanair, the low-cost airline, is considering taking drastic measures to cope with soaring fuel prices, which are expected to remain high through 2027. The company has indicated that it may freeze workers' pay and raise airfares by double-digit percentages to cover the increased costs. Ryanair's CEO, Michael O'Leary, explained that fuel expenses are forecast to be €2 billion higher in the short term and that fare hikes would have to be substantial to offset these costs.

However, O'Leary believes that fare increases alone may not be sufficient and is exploring the option of temporary pay freezes for staff. Unite, the union representing Ryanair employees, has been approached for comment. The airline has also decided to slow down hiring as its overall costs continue to rise. Despite the union's efforts to hedge against fuel price fluctuations, Ryanair notes that a significant portion of its fuel bill remains unprotected, with elevated costs for the remainder.

CEO O'Leary reiterated earlier forecasts that a 20% fare increase would be necessary to cover fuel expenses, although he acknowledged that such a hike may not be realized. Ryanair anticipates double-digit fare increases across Europe in 2027. The company is also considering freezing pay once maturing labor agreements with unions come to an end, potentially beginning in April 2024.

Additionally, Ryanair is exploring the use of artificial intelligence within its back office and support functions. The airline has already reduced winter flights and expects further reductions to continue throughout the summer of 2027, a trend observed across the industry, particularly among short-haul carriers.