Low cost airline Ryanair has a basic but successful business model: it cuts costs to the bone and often operates out of out of centre airports which, to put it bluntly, are begging for the business.
Some of these, often regional, airports are so keen to get Ryanair’s business that they offer token or forgive all of their normal charges. Some of the welcome incentives have been so generous that they raised eyebrows at the European Commission and sparked investigations into illegal state aid. But whatever the doubts, the business model survives and thrives.
Ryanair has been looking to add Pardubice airport to its list of destinations. Three flights a week between Pardubice and London’s Stansted airport were pencilled in to start from October this year with the East Bohemia airport being somehow sold as ʺPrague Pardubice." But as often is the case with Ryanair tie-ups, the airline had been looking for some sweeteners to underwrite its launch of services.
One stumbling block though has emerged, the East Bohemia region, which owns around a third of the airport operating company East Bohemia Airport, is refusing to meet the bill of around 8.0 million crowns a year to temp Ryanair to Pardubice. The 66.6 percent owner of the airport is the town of Pardubice which is in favour of bringing Ryanair in.
East Bohemia Airport management, who are firmly convinced of the merits of the Ryanair deal, will now have to decide whether to try and keep the projected service alive by drawing on the airport’s own reserves to offer the promised support.
Even after a loss of around 12 million crowns last year, East Bohemia Airport still has a reserve of 18 million crowns it can draw on if needed. The airport’s director says she will take a time out and consult again with the major shareholders about whether to go ahead with the project.
Ryanair meanwhile is already advertising the return Prague-Pardubice service for 1,400 crowns although sales of tickets have still to commence.
The airport is desperate to find new carriers after a sharp fall off in use by Russian airlines which offered charter flights to the Czech Republic. The airport is estimated to have lost around 150,000 passengers as a result over the last two years with Russian passengers down to just 30,000 last year.