Ryanair uses new €8.5 Norwegian air passenger tax as excuse to cut Oslo capacity
On 1st June, Norway introduced a small charge per air passenger, of around €8.50. Now because of the tax, Ryanair, in bullying and blackmailing mode, says it is to close its base at the low cost Rygge airport at Oslo on 29th October, and reduce its Norwegian traffic by half. The Norwegian government expects to raise an additional €107 million or so, from the tax, during 2016. But Ryanair fears losing money from the tax, which is calls (?) “environmentally unfriendly”. Ryanair says it would mean the loss of 900,000 air passengers per year to Norway, (the country’s population is only 5.2 million, but there were around 53 million air journeys in 2015) and 1,000 jobs at the Rygge airport. Ryanair is, in terms of air passengers, a distant 4th in Norway, behind SAS, Norwegian and Wideroe. The low cost airlines fear reduced profits, and inevitably higher fees – though the increase is tiny. Ryanair’s commercial officer said the €8.5 tax would destroy the “cost competitiveness of the privately owned Oslo Rygge Airport in favour of the state-owned Avinor.” Anna Aero reported in January that Ryanair actually did not do well in Norway in 2015, and cut its available capacity by 8.6%. The tax may be an excuse to get out. Norway’s centre-right prime minister, said last week: “This government will not be blackmailed by Ryanair.”
Ryanair retaliates against Norway air tax
Richard Milne, Nordic Correspondent (Financial Times)
June 1, 2016
Ryanair is to close its main base in Norway and cut half of its flights to the Nordic country in retaliation at Oslo’s decision to introduce a tax on air travel.
…. Full FT article at
Ryanair calls new tax ‘black day’ for Norway and closes Oslo base
Traffic to be reduced by half after government introduces passenger excise
1.6.2016 (Irish Times)
By Colin Gleeson
Ryanair has said it is to close its base in Oslo and reduce its Norwegian traffic by half due to the introduction of an air travel tax by the Norwegian government.
The tax of NOK80 (€8.59) per passenger became effective on Wednesday. It is imposed on both domestic flights and international flights departing fromNorway. The government expects to raise an additional NOK1 billion from the tax during 2016.
In a statement, Ryanair said the introduction of the “environmentally unfriendly” tax was “a black day for Oslo Rygge, for Norway, and for Norwegian tourism”.
It claimed the “retrograde tax” would damage Norwegian tourism, traffic, and result in the loss of 900,000 passengers per annum and 1,000 jobs for Oslo Rygge.
Ryanair chief commercial officer David O’Brien said the airline’s base in Rygge would close on October 29th.
The move will mean the cancellation of 16 routes: Beziers, Brussels, Chania, Dublin, Edinburgh, Malaga, Palma, Poznan, Pula, Riga, Rzescow, Thessaloniki, Sczecin, Talinn, Wroclaw, and Zadar.
“All airlines operating in Norway had repeatedly warned of the damage this tax would have on Norwegian air travel and tourism and had urged the Norwegian Government to scrap their plans,” said Mr O’Brien.
“Governments in Belgium, Ireland and the Netherlands had already scrapped similar taxes and returned to growth.
“Sadly, despite these warnings, the Norwegian government has destroyed the competitiveness of Oslo Rygge, an independent, profitable airport.”
Mr O’Brien said the move would “destroy” the cost competitiveness of the privately owned Oslo Rygge Airport in favour of the state-owned Avinor.
“The illogical decision of the Norwegian Government to introduce a flat rate environmentally unfriendly tax unfairly penalises passengers on efficient, green airlines such as Ryanair in favour of passengers on high fare, half empty, gas guzzling airlines,” he said.
“As a result, Ryanair has no choice but to close its Oslo Rygge base which will result in our Norwegian traffic being cut in half.
“Since Oslo Rygge has confirmed it will be unable to sustain reduced non-based services offered by Ryanair, we will move our remaining eight Rygge routes to Oslo Torp from October 30th.
“This tax will severely damage Norwegian tourism, particularly around regional airports. The Norwegian government has instantly made Norway uncompetitive and less attractive to airlines and tourists.”
The airline will also move its routes from London Stansted and Vilnius, Lithuania, to Norway’s Gardermoen, and increase the former to a three times daily service.
It will then move its Rygge-based aircraft, pilots and cabin crew to other bases in its 33 country network.
A long article on Anna Aero
Norway traffic down 0.5 million; Oslo Gardermoen commands 47% of passengers as Ryanair is granted slots at country’s biggest airport
After recording a growth in seat capacity over the past 12 months of over 19%, Wizz Air recorded the best growth in Norway’s LCC market. Norwegian and Ryanair (second and fourth largest carriers) each recorded declines during 2015, with the former showing a drop of 1.3%, while Europe’s biggest airline cut its available capacity by 8.6%. In regards to Norway’s national and number one carrier SAS, it is showing a rise in its available seat capacity of 1.6% or approximately 20,000 seats. However, the biggest growth from Norway’s top 12 carriers comes from Turkish Airlines, which is recording a growth of nearly 25% when compared to the same time period of last year.
Norwegian government introduces approx €8.5 tax per air passenger on all flights
The Norwegian government will introduce an Air Passenger Tax, starting on 1st June 2016. It will be at the rate of a 80 Krone charge (around €8.64, £6.59, US$9.67) per person for both domestic and international flights. Exceptions of the tax include those under two years old and those transiting flights on the same airline. The airlines have, predictably, reacted with fury at being “defied” by the government. They say this tiny tax “threatens to reduce demand by 5%, equal to 1.2 million passengers a year,” and they say it could mean airlines might lose €150 million per year as a result. The airline lobby group, “Airlines 4 Europe” (whose members include EasyJet, Ryanair, Lufthansa, Norwegian Air Shuttle and International Airlines Group) is lobbying hard. They all completely ignore the inconvenient fact that air travel demand is artificially high, as it pays no VAT and no fuel duty. Those together amount to a massive annual subsidy (in the UK this is a net annual loss to the Treasury, even including takings from APD, of perhaps £9 blllion per year). Several European countries do have a ticket tax, with the UK levels being the highest (Brits also fly more than most others). There are small charges in France, Germany and Austria. Ireland and the Netherlands scrapped theirs, due to airline pressure.