Michael O'Leary - CEO, Ryanair HARDtalk

That is due to Central Engineering work that is taking place. It is

now time for HARDtalk. The aviation business is in a mess.

Fuel prices have increased, passenger numbers are squeezed and

a number of airlines have gone out of business. But one airline has

bucked the trend. That is why any error, which last year pulled in

almost 80 million passengers. -- Rainier. My guest tonight is

Michael O'Leary. He has become the anti- hero of the airline's

business. But how far can he fly before he gets shut down?

Michael O'Leary, welcome to HARDtalk. It is a pleasure to be

back. Your business is doing pretty well all stop your profits are up

and passenger numbers are looking pretty good. How close are you to

the limits of how far you can go? think we have barely scratched the

surface. Over the next ten years we would like to see passenger numbers

double to around 160 million passengers. We would like to go

across the UK and across continental Europe. It is limitless.

A but the message from the aviation industry generally, and

particularly in Europe, is to find growth you have to consolidate.

Look at various other groups. They had tried to maximise their place

in the industry by consolidation. Is that what he will have to do?

do not think so. The industry has two different types of carriers.

You have the ones that need people to connect. You will inevitably go

with those ones. but it is expensive and not punctual. If you

want to get there for a patching of the price, you go with us. You say

they too can grow without limits in Europe and taking on other airlines,

so why are you so keen to purchase Ireland's national airline? You

will not let it go. We will carry 80 million passengers. They will

carry around 9 million passengers. Their legacy, nobody wants it.

do you want it? We can grow Aer Lingus as a separate brand. They

already have a good brand. We think we can restructure Air Lingus and

put it on the path of growth. have been accused of monopoly

control. Is there any way you could soft and the takeover by giving

away groups to a point with the EU is satisfied? We are prepared to

give whatever the commission wants. Whatever concessions they want, we

will give. You are prepared to give away? If need be. What we did in

2007, our offer was rejected. This time around, we have those terms.

We are hopeful that it will be approved. But we are still waiting

for the commission to explain why an people are allowed to buy

British Midland, clearly a emergent monopoly, but we have to jump

through hoops. The EU needs a more consistent competition policy. On

one occasion, we tried to rescue her Lingus and we have been shut

down. There has been a lot of talk that you were already negotiating

to get rid of your stake and make a tidy profit. We never comment on

speculation. Our contract will be accepted. If it is not, we will

appeal. We will not speculate on what we will do in the future. We

had to be allowed to produce their Lingus. They will be broken up and

disappear as a friend. Speaking about growth in a difficult

business, another area you have looked at is getting a stake in one

of Britain's growing upwards. It is part of the infrastructure of

airports around London. It seems to be problematic. It seems the people

who currently in the airport do not want you involved in any sale.

Despite her ambition, it seems pretty clear that you cannot be

part of it. That is not clear. We have been written to. We have been

written to in recent weeks saying that people are not prepared to

deal or engage with us. Any consortium that involves us. That

is an extraordinary decision. The Competition Commission say they

want a customer-focused sale process. I do not know how you can

exclude the largest customer. We have accepted the reality. So you

are backing out? We are withdrawing from the process because we do not

want to prevent the number of other consortiums and investors from

bidding. We look forward to working with whoever is the owner. We have

faced worse. We think it has a bad future. You know that Boris Johnson

is pushing very hard for a new airport on the Thames estuary. He

is trying to attract business support for that. Are you prepared

to back him? I think it is an insane idea. There has been no

mediation policy. -- aviation policy. What we need is the

multiplicity of airports. It is good for the UK and the south-east.

They can compete with each other. You have a massive capacity

constraint at each of them. The way to redress that is to build on the

airports that already exist. The government needs to take this and

say they are committed to an additional runway. They can cope

with additional capacity. But you still do not end up with a hub

airport that can compete with Singapore and elsewhere. Yes you

would, it would be Heathrow. Let us talk about the culture of Ryanair.

I think it is worth looking at the way you run your business. It is

fair to say that you seem to take pride in ignoring everything they

teach at business school about the customer being king, that care and

comfort about the customer being first priority. That is not the way

you run it. I think it is absolutely wrong. The difficulty is

that most businesses talk about the customer being king but provide

high-priced services and poor service. We think the customer is

king because we deliver what passengers really want. Knows so

charges, very low prices, the best on-time performance and low

complaints. To take just one example, the lady who tried to take

legal action against you because you charged her hundreds of pounds

to print out boarding passes because she was not able to do it

when she was in Spain. She came to the airport when she was in Spain.

You charge to hundreds of pounds. It was in the small print. But she

said that in the circumstances you did not. If the customer is truly

king, why did you choose to take on that woman in that situation?

did not choose to take on the woman. More than 99.9 % of Ryanair

passengers agree at the time that the chicken on the website before

the arrival. It is not small print. It is in big print. We send you an

e-mail asking people to chicken. If you do not, you have to pay 50 quid.

The lady did not. She then arrived at the returns lounged. I am very

sorry. We regret that you did not comply with your agreement. That

means you pay the fee. What I am getting to is that the style that

you adopt, you said that if you mess up you have to pay up. And for

you that seems to work. What works for us is that we are very

sympathetic and we have simple policies. Do not show up asking for

a free gin and tonic. To not arrive with a cheque in back if you do not

have a ticket for it. When and 99% of passengers comply with these

rules. What we say to the 0.1% is to not expect us to break the rules.

What I am driving at and is interesting to people trying to run

businesses around the world is how it works so well for you. Who

deliver messages that turn you into the anti- hero of aviation. A

couple more examples. You floated an idea that you might try and fly

your planes with just one pilot to save money. Then you said, long-

term, you love the idea of standing room areas in the back of the plane.

Birth of those are never going to happen and you know it. But to seem

to like creating these controversies. I am not attracting

publicity. We are thinking outside the box. We are trying to make our

air fares even lower. There is some point that there will be one pilot

fights. To quote your own PR office, they admitted later that idea was a

publicity and advertising sand. should never trust anybody's

publicity Office. The West's Afghan over

Afghanistan. But they do not have any passengers on board. They have

explosives on board. Never is a long time. I understand it is not

likely to be happening in the next five-ten years. The technology is

advancing all the time. It may take 10, 20 years. But we believe that

people will be flying wanderings. In Stansted, there is a driverless

train. Statistically, there are quite safe. It is a constant quest

in Ryanair to find ways to question existing orthodoxies. So that we

can make things more affordable for passengers. But she will probably

acknowledge that while people respond well to the low-cost

message they want to be sure that safety is never compromised. We ran

into a particular set of problems In Spain, three of your planes were

forced into emergency landings in Valencia. There were are questions

about how much fuel your planes were carrying. The press has

reported memos in which your pilots are being told they need to get

special authorisation to carry fuel which is a few hundred kilograms

above the minimum threshold. Is that true? A no. They had three

fuel emergency landings in Valencia. They are the only fuel emergencies

we have had in the last 18 months. There was bad circumstances in

Madrid that evening. All of the planes flew for one up for more

than scheduled. All around 30 minutes of reserve fuel. In

exceptional circumstances. The Civil Aviation Authority has

confirmed that there were 20 such landings in the last ten years.

This is not unusual. -- this is unusual, not unprecedented.

Spanish pilots union claims that Ryan Air Pilots are confronted by a

cost cutting exercise on fuel that You around the limit of doubt.

cannot trust what you are told. What does not get reported is the

official confirmation from the Irish Aviation Authority which says

our fuel policy complies fully with all EU requirements. Does it not

worry you bring your own pilates, quoted anonymously, say things like

this "the authority of the pilot is being taken away by Ryanair and

this policy on field could lead to more fuel emergencies than before."

It is unfair to quote an anonymous pilot. They are anonymous because

they dare not speak out. These are lies. Your pilots are lying? How do

I know it is my pilot? It is anonymous. You have confirmation

from the European safety regulator which confirms that Ryanair's fuel

policy fully confirms that complies with the lot. We follow the same

rules as the other European airlines. That is why more than one

million Flight's, we have only had three fuel emergencies. There were

exceptional weather circumstances in Madrid. I am driving at a

perception that, as Ryanair expanse, and you have talked about ambitious

plans for the future, it may have to revolt. I want to quote you

something said by Michael O'Leary a couple of years ago. Never believe

temple stopped he said "I think there will be a time for it is

appropriate to replace me. In two three years, Ryanair will need a

different face, a different personality, someone who will care

about fuel and the environment and all but staff because then they

will be a big company and that will not be me." I qualified that remark

by saying there were a number of including Stansted, the double

airport issue, the future of Aer Lingus. -- Dublin airport. I think

once we have tackled all of those issues and Ryanair is set fair

Witham plan, it will be time for me too well. I will tell you what

entreat me about the comment that you made about two or three years,

I wonder if that's something different might be a role in the

public domain and Ireland. World you have been leading this business,

your own country has got itself into the worst sort of economic and

political mess. I wonder whether you see a role for yourself in

trying to get our island out of the hole that it is in. No. There is a

great danger because people of limited ability like myself, you

might occasionally get lucky and be good at one particular job. I think

I am good at running a kneeling. You get into dangerous territory of

when you think you can walk on water. -- running in Ealing. I do

not know about dealing with the economic problems and Ireland. Many

successful business people have gone into politics and had a

disaster. You have been mouthing off about what you think I'll and's

problems are. This is a democracy. Everyone can have an opinion. --

Ireland's problems. I just wonder, you have said you want to see an

end to what you call too much welfare, you want to cut

entitlement, you want to privatise the health system. This is in a

country which is going through the most intense period of austerity.

Do you think that the Irish people are ready for that? I think it

needs to happen at some point in time in the not-too-distant future.

Everyone is having been behind the banking crisis. Ireland as an

economy has a fiscal deficit of about 15 billion a year. We take in

about 35 billion and we spend about 50 billion. That is simply

unsustainable. One way of dealing with it would be to raise some tax.

1.3 million euros a year, your salary. You'll get 20 million euros

for the dividends. Not quite that but not far off that. You a very

wealthy man. I am also the largest single taxpayer in the country.

Adult paid 12 million euros in tax to the Irish government. You have

also said that you are so fed up with being tax but you might walk

out of the country. I get fed up with me and my family are tax to

the hilt and the money is squandered on doing things like

being Sinn Fein politicians 50 million euros to buy toner

cartridges. There is a 15 billion deficit every year. Unless you

close that deficit, you will not close taxation. There is not enough

people and the country to pay 15 billion euros in tax a year.

something that strikes me about Ireland as an outsider, after the

Celtic Tiger, what we see in this country is immigration on a serious

scale. On average, every day in this country, 238 people are

leading and most of them are young Irish people. If you were starting

out after school or college today, a young Michael Levey in Ireland,

out get out of here? -- Michael Levey.

grew up during the last recession in Ireland. We need a programme

that eliminates the fiscal deficit. Unless you eliminate that debt is

it, we cannot return to growth. Ryanair delivers rapid traffic in

tourism growth here, 5 million passengers a year. There is only 20

million passengers in total. We could grow by 25 % over a five-year

government and we cannot get a reply by from the Government. The

fire was an American multinational, he would be building statues,

giving the tax breaks in giving me but I want. When you are an Irish

company, roadblocks are put in your way. You have chosen to answer in

an economically. Talking about economic changes and the forms you

would like to see. Is there not something deeper than that? Is

there not something wrong with the political culture in this country?

If you turn on the news, you see a whole host of the country's top

bankers, property developers and sometimes even politicians who are

being hauled over the coals for this sort of cosy, crony stick

relationship which has developed in this country which allowed people

to make vast amounts of money and, frankly, build businesses that were

based on a pack of lies. Is there not something wrong with the

culture if that is allowed to happen? There was a big property

bubble here, as there was in Spain, Greece, and other European

countries. Ireland is also responsible for a great success

stories, Ryanair and not the least of them. Have you had to play the

crony game to get things done? Thankfully, Thankfully,e has not been

a great deal done in this country in recent years. A substantial

point. A lot of your business is overseas. The figure used to be 40

%, now it is 10 % for traffic. have said in the past that Ireland

and the EU is dominated by half- wits and idiots. Why, if that's the

case, are you asking the Irish people to vote for the fiscal

treaty that is currently under discussion? Because it is painfully

self-evident that we don't have any alternative. We are borrowing 15

billion a year to sustain the current government's spending

programmes. The only people who will lend us that money is the

European Union. We'd better vote for it because it's the only show

in town. We cannot afford an Icelander overnight devaluation