Ryanair and Air Europa partnership shows how LCCs will become long-haul feeders

23 May, 2017

I am sure there are numerous questions that will be raised by any company board looking to enter into a partnership with Ryanair, but the budget carrier has seemingly overcome a childhood with a blatant disregard for authority and is now showing the maturity of adulthood. The language has changed, the model has changed and its ‘Always Getting Better’ programme has propelled it into new markets and introduced significant new revenue streams.

Across its first two decades of operations following its rebirth in the 1990s, Ryanair, like a growing child, demanded a lot of attention but had very little friends. Now, as it has matured into Europe’s largest airline it is a different story and there will likely to be a long line of airlines and businesses looking to gain from its major network across Europe.

After revealing the trial of its flight connection product at Rome’s Fiumicino Leonardo da Vinci International Airport last week, the airline has now entered into a partnership with Spanish carrier Air Europa that delivers significant benefits to both airlines and will allow Ryanair to start selling long-haul flights.

The airline’s CEO, Michael O’Leary is desperate for Ryanair to be part of the emerging long-haul, low-cost market, but is acutely aware that it will be near impossible for the business to succeed as part of the Ryanair operation and a standalone start-up would take time and initial investment to form with no guarantees of a sustainable profitable return.

Instead it and the Ryanair board have identified the business can take advantage of what it already has… an unmatched network that can provide the feed to facilitate the long-haul flights of others. As part of what it describes as a “natural progression” to become the “Amazon of air travel”, the European flight offer becomes a commoditised product that it can link directly with its own expanding accommodation offering and now complementary flights from rival airlines.

While long-rumoured discussions with Norwegian continue, Spanish carrier Air Europa has become the first airline to become a partner and from today (May 23, 2017), Ryanair’s 130 million annual passengers will be able to book Air Europa long-haul flights on its Ryanair.com website covering 20 routes from Madrid to 16 countries in North, Central and South America, including Argentina, Brazil, Cuba, Mexico and the United States of America.

These are initially having to be booked as two separate tickets with the need of luggage collection between flights. However, the second phase of this Air Europa partnership will be launched later this year and will allow Ryanair customers to actually connect directly onto Air Europa long-haul flights through Madrid.

This brings obvious benefits to Ryanair as it attempts to become the one-stop shop for air travel, but it also delivers significant exposure for Air Europa in foreign markets where its brand is not as widely recognised and its connectivity options into the Americas not generally considered by passengers.

“This partnership with Ryanair gives us great satisfaction, and it puts us at the forefront of business and allows us to strengthen our competitiveness,” says Javier Hidalgo, chief executive officer of Air Europa’s parent Globalia Group. Effectively with this agreement, the Spanish airline will more than double its connectivity with the European continent numerous additional cities and among the best price-quality options to fly between Europe and America.

Ryanair this summer is providing non-stop flights to 51 destinations from Adolfo Suárez Madrid–Barajas Airport, including ten markets also currently served by Air Europa (Brussels, Frankfurt, Fuerteventura, Gran Canaria, Ibiza, Lanzarote, Oporto, Palma, Tenerife North and Tenerife South). Together the two airlines will serve 64 destinations across Europe, highlighting the value of the connectivity to Air Europa and growing its connectivity 133.3% by destination, 74.1% by departures and 78.6% by seats.

These figures highlight the value of the Ryanair feed to partner airlines’ medium- and long-haul activities and explains why Ryanair is continuing discussions with a number of other long-haul airlines on potential feed and connecting flight partnerships.

READ MORE… Ryanair's next step to becoming a network airline: Air Europa long haul feed & Rome transfer product