Ryanair has said it’s considering a range of measures, including pay freezes and more use of AI, in an effort to curb soaring costs of jet fuel.
The Irish airline giant has said it expects jet fuel prices to “remain elevated well into 2027” as the ongoing war between the US, Israel and Iran rages on.
Ryanair currently has around 80% of its jet fuel hedged at prices much lower than the market rate, but this provision is due to fade out after the end of this financial year.
The airline is, as a result, predicting an escalation of roughly £1.7billion (€2billion) in its fuel prices for April 2027-March 2028.
It said it expects European short-haul airfares to “increase materially” to reflect higher fuel prices but this is not likely to fully offset the increase.
Chief executive Michael O’Leary told Sky News that he expects European flights to see “double-digit” price increases next year as fuel costs feed through to travellers.
He said: “I don’t believe higher fares will be enough, so we will be taking out airport costs, aircraft costs too.
“We will have to do whatever we can to survive this.”
Bosses added that the group is therefore reviewing all costs, with a focus on areas such as labour agreements, which could lead to temporary pay freezes, and lower crewing ratios.
Ryanair will also review the “increased use of AI to drive further operational and back-office and support functions productivity”.
It came as the company revealed that profit after tax fell by 15% to £1.79 billion (€2.15 billion) for the half-year to September, compared with a year earlier.
Revenues increased by 3% to £8.41 billion (€10.08 billion) , driven by 6% increase in passenger numbers.
But the firm saw operating costs lift by 10% for £6.42 billion (€7.69 billion) for the period.
Earlier this year, Ryanair said it would cut its traffic target for the year from 216 million passengers to 214 million in an effort to offset increases in unhedged fuel costs.
Mr O’Leary said: “While third-quarter demand is strong, with fares trending modestly ahead of the same quarter last year, the booking window remains closer-in which reduces visibility.
“The third-quarter’s fare outcome will heavily depend on the strength of close-in October/November school mid-term and Christmas bookings.
“As is normal at this time of year, we have zero Q4 visibility. It therefore remains too early to provide meaningful full-year 2027 profit-after-tax guidance.”
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