SWOT analysis of Ryanair (Ryanair’s SWOT)

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SWOT analysis of Ryanair (Ryanair’s SWOT)

This is a detailed SWOT analysis of Ryanair. It aims to analyse the strengths and the weaknesses of Ryanair. It also aims to explore the opportunities and the threats facing the airline. Ryanair is a low-cost airline, headquartered in Dublin, Ireland. It was founded in 1984 by the Ryan family.

Strengths of Ryanair

Ryanair carries over 154 million passengers a year on more than 2400 daily flights. It flies to over 200 destinations in 40 countries. In 2017, it became the first European airline to have carried over 1 billion customers. It has over 470 aircraft to take its passengers to their desired destinations (Ryanair, 2021).

Ryanair is the pioneer in the low-cost airline business model and has accumulated a great amount of expertise in the industry over the years. Being cost leader in Europe enables it to enjoy a significant cost advantage over all other EU airlines. Indeed, it ranked 11th Best Low-Cost Airline in the world in 2018 voted for by travellers. It also ranked 9th Best Low-Cost Airline in in the world in 2019. Likewise, it is also ranked the Best Low-Cost airline in Europe in 2019 (Skytrax, 2021).

Ryanair reported a 10% increase in profits in May 2018. The profit after tax for the year ended on 31 March 2017 was €1.31 billion, while €1.45 billion for the year ended on 31 March 2018. However, it should be mentioned that the net profits dropped to €885 million in the year 2018/19 (Mazareanu, 2020).

The size and the average age of Ryanair fleet are also impressive. Ryanair is the largest European airline by the number of passengers carried. It only uses Boeing 737-800 aircraft and the average age of its planes is 5.5 years. It has over 470 aircraft in operation and aims to increase the size of the fleet to 585 by 2024. With such a massive and streamlined fleet in action and more to be added soon in the portfolio, Ryanair is and will be able to lower its fares further and carry more passengers. In fact, it aims to carry 200 million passengers per annum by 2024 (Ryanair, 2021).

Weaknesses of Ryanair

Ryanair’s weakness in managing employee relations was evidenced in the summer 2018 when walkouts by pilots and cabin crew over pay and work conditions forced it to cancel flights to some of the major holiday destinations. The airline should indeed take necessary steps to avert the return of similar disruptions in the future.

Ryanair has positioned itself as a low fare and safe airline. However, customer perception of the brand has been a problem for the airline. For instance, Ryanair’s Buzz score (YouGov) has not been that great for quite sometime. Though this has been mostly attributed to strikes and flight cancellations, it is also true that the airline has performed poorly in a range of polls and surveys for many years.

It should be mentioned that Ryanair’s image also took a hit in 2020 when its flights got cancelled because of lockdowns. While its key competitor easyJet refunded the money to its passengers on time (in fact, with a very short time), Ryanair has been accused of procrastinating the matter making may people upset and angry.

Opportunities for Ryanair

Ryanair has a very strong presence in countries such as the UK, Germany, Italy, and Spain. Undoubtedly, these markets present further growth opportunities for the airline. Likewise, introducing new routes is also worth exploring. In fact, Ryanair announced over 200 new routes in the summer 2018. These new routes include but not limited to markets in Jordan, Turkey, and Ukraine. In addition to introducing new routes, Ryanair can also explore opportunities to diversify into other complementary segments of the aviation industry in Europe and beyond.

Threats to Ryanair

Threat is the last element to address in the SWOT analysis of Ryanair. There is no doubt that Ryanair faces a number of fierce competitors. EasyJet, Norwegian, Eurowings, Jet2.com, Vueling Airlines, and WOW Air are some of the major competitors of Ryanair in the low-cost airline markets in Europe.

Ryanair faces legal challenges as well. For instance, the UK’s Civil Aviation Authority took legal action against the airline over its refusal to compensate thousands of UK customers affected by flight disruption over the summer in 2018 (BBC, 2018). While such legal actions may not cause a financial havoc for the airline, it may damage its image in the market.

We hope the article ‘SWOT analysis of Ryanair (Ryanair’s SWOT)’ has been helpful. You may also like reading SWOT analysis of EasyJet. Other relevant articles for you are:

How to do a SWOT analysis

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Last update: 12 January 2021

References:

BBC (2018) Ryanair compensation claims to go to court, available at: https://www.bbc.co.uk/news/business-46451702 (Accessed 30 December 2018)

Kellew, J. (2018) Ryanair faces legal action over refusal to compensate cancelled flights, available at:  https://www.theguardian.com/business/2018/dec/05/ryanair-faces-legal-action-over-refusal-to-refund-cancelled-flights (Accessed 28 December 2018)

Mazareanu, E. (2020) Net profit of Ryanair from 2011 to 2020, available at: https://www.statista.com/statistics/756093/ryanair-net-profit/ (accessed 12 January 2021)

Ryanair (2021) Ryanair full year profits rise 10% to €1.45BN, available at https://investor.ryanair.com/wp-content/uploads/2018/05/Ryanair-FY2018-Results.pdf (Accessed 12 January 2021)

Skytrax (2021) World’s Best Low-Cost Airlines 2019 https://www.worldairlineawards.com/worlds-best-low-cost-airlines-2018/ (Accessed 12 January 2021)

Photo credit: Pixabay

Author: Joe David

Joe David has years of teaching experience both in the UK and abroad. He writes regularly online on a variety of topics. He has a keen interest in business, hospitality, and tourism management. He holds a Postgraduate Diploma in Management Studies and a Post Graduate Diploma in Marketing Management.