Ryanair News

News Release

15.04.11

Briefing note - Checked in Bags

RYANAIR’S CHECKED IN BAGGAGE FEE (CIBF)
 
 
1.      When CIBF’s were first introduced in March 2006 (see press release below), Ryanair reduced all its air fares by 9%, so that the air fare paid by passengers without checked in bags reflected the lower costs associated with those passengers.
2.      The CIBF was then imposed (only on passengers who wished to check in luggage) to reflect the direct costs associated with handling checked in baggage, which include check-in staff, check-in desk rental, baggage hall fees, 100% hold baggage screening fees, baggage handling staff, ramp equipment, lost bags office etc. Since 2006, many other airlines including Aer Lingus, BmiBaby, Flybe, Germanwings, Vueling, easyJet have begun separately charging for checked in bags.
 
3.      The CIBF is entirely optional. All Ryanair passengers can avoid this CIBF by simply flying with no checked-in bags and instead using Ryanair’s increased (10kg) free of charge, one carry-on bag facility, thereby avoiding CIBF’s altogether.
 
4.      Since Ryanair introduced a CIBF in May 2006, the number of Ryanair passengers travelling with checked in bags has fallen from 80% to just over 20%. Accordingly the vast majority of Ryanair passengers no longer check in bags, and no longer pay a CIBF or any costs associated with handling checked in bags at airports.
 
5.      This CIBF is agreed to by all Ryanair passengers who select the check-in bag service, when making their original booking.
 
6.      All passengers agree at the time of booking that their contract with Ryanair is governed by the Laws of Ireland. Therefore any Spanish (or other EU) regulation requiring that an air fare include free of charge checked in baggage does not apply to Ryanair flights or ticket contracts.
 
7.      This Spanish regulation is an unlawful interference in the freedom of an EU/Irish multi-national airline to determine freely now it charges for its services. No Spanish regulation can require Ryanair to provide any service (such as checked in luggage) free of charge. No Spanish regulation can require (for example) that hotels provide phone calls from hotel rooms be included in the price for the hotel room. Checked in baggage attracts identifiable and separate costs, and these should be separately charged and paid for by those passengers who wish to travel with checked in bags, and who agree to the CIBF. These fees/costs should not be paid by or imposed on passengers who travel with carry on luggage.
8.      Any regulation which requires airlines to include checked in baggage as a free of charge service, effectively requires that the majority of Ryanair passengers (who now travel with no checked in bags) should now pay higher and unfair prices. Passengers without checked in baggage should not pay higher fares to subsidise the minority of passengers who choose to travel with checked in bags which are much more expensive to handle at international airports.
9.      This Spanish regulation is out of date, as it does not consider recent developments in the airline market initiated by the EU’s liberalisation of the market. This is proven by the fact that no other Member State knows a similar law. Even the EC has recently confirmed that the carriage of check-in bags is an optional service.
 
10.No Spanish law can compel or direct a non Spanish airline as to how they should price for or provide their services to consumers. No Spanish regulation can force an airline to include checked in bags free of charge, since no Spanish regulation can force Iberia to include fuel surcharges in its ticket prices.  It is clearly unlawful for any Spanish regulation to allow Iberia to levy a €25 fuel surcharge, but require that Ryanair passengers with carry-on luggage only pay the same fees/costs as passengers with checked in bags who create significantly additional costs in order to provide this check in bag service. 
 
11.Ryanair believes this Spanish regulation is in breach of EU law, since Spanish legislation cannot force an Irish airline to include checked in bags free of charge, nor can Spanish regulations force airlines to include snacks or drinks free of charge. Each airline company is free under European law to decide how it should package its services and/or charge for those services. Passengers are free to choose whether they check-in a bag on Ryanair or not, and each passenger is free to choose whether they pay the check-in bag fee or not.
 
12.All Ryanair passengers are permitted under Ryanair contracts to carry one “carry-on” bag (up to 10kgs in weight) on board the aircraft as carry-on luggage, entirely free of charge. This does not include additional duty free shopping bags, which must be placed within the 10kg one carry on bag prior to boarding. This one carry-on bag rule is agreed to by all passengers under Irish contract law at the time of booking with Ryanair and cannot be amended or interfered with by a Spanish regulation which has no effect under Irish contract law.
13.Ever since the CIBF was introduced, Ryanair has at all times informed consumers about the applicability and level of this fee in our T&C’s and Table of Fees. Both documents are available on Ryanair’s website both before the booking process begins and also in the course of the booking process.
 
PRESS RELEASE
 
RYANAIR ANNOUNCE LOWER FARES & NEW PASSENGER SERVICES
 
Ryanair, Europe’s largest low fares airline, today announced a number of key service improvements, effective from 16th March 2006, for all passengers including:
 
  1. all Ryanair’s fares will be reduced by 9% (£2.50 or €3.50),
 
  1. all passengers travelling with hand luggage and in possession of an EU passport will be able to check-in online at www.ryanair.com and by-pass all check-in and airport queues, these passengers will also be given priority boarding which will eliminate boarding gate queues as well,
 
  1. for bookings after 16th March, Ryanair is increasing each passenger’s luggage allowance from the current 25kgs to 30kgs (comprising 10kgs carry-on and 20kgs checked-in luggage) which will substantially reduce excess baggage fees and finally
 
  1. all passengers travelling with checked in luggage who book after 16th March will now pay a fee of £2.50 (€3.50) per bag, per flight if booked in advance on online, or £5.00 (€7.00) per bag, per flight if presented un-booked at the airport.
 
As a result of these changes, those 25% of Ryanair’s passengers who presently travel with just hand luggage will avail of lower fares, will avoid the inconvenience of check-in or boarding gate queues and will no longer cross subsidise those passengers travelling with checked in luggage.
 
A further 50% of Ryanair’s current traffic (who travel with just one checked in bag) will see no change in their cost of travel, as the £2.50 ticket price reduction will fund their £2.50 baggage fee if booked on the internet. These passengers will enjoy much shorter queues at check-in thanks to the large numbers of people who will now switch to web check-in, thereby reducing the airport check-in queues.
 
Lastly those passengers who presently travel with more than one checked in bag will see the cost of their travel rise by the £2.50 (€3.50) per bag for their second and subsequent bags. These passengers will also enjoy shorter check-in queues, and will be encouraged to travel with less checked in luggage which would then make these changes cost neutral for them as well.
 
This 9% “across the board” reduction in Ryanair’s ticket prices from 16th March will make these changes revenue neutral for Ryanair. Ryanair estimates that the reduction in ticket revenues and excess baggage fees will cost Ryanair more than £100m per annum. These lower fares will stimulate further traffic growth and increase the current (50%) price differential between Ryanair’s prices and the average ticket prices of our higher fare competitors such as Easyjet. We expect as a result of these measures, and in particular the attraction of web check-in and priority boarding that more and more of Ryanair’s customers will be incentivised to travel with hand luggage only and take advantage of Ryanair’s industry leading 10kgs of carry-on luggage. 
 
The upside for Ryanair in these initiatives will be the opportunity to significantly reduce airport and handling costs. We believe that 40% to 50% of passengers will quickly switch to our new web check-in/priority boarding service. This will allow Ryanair to reduce the number of check-in desks, baggage hall and other handling facilities we rent at major airports. It will significantly reduce the number of check-in and baggage handling staff required to handle individual flights, although the airline expects few reductions in staffing numbers in these areas, as existing numbers will be required to handle our rapid growth. Ryanair believes that its airport and handling costs will be reduced by over 10%, which equate to a saving of some €30m. This saving would equate to 10% of Ryanair’s current year forecast after tax profits.
 
Announcing these changes, Michael O’Leary said:
 
“Many sceptics have doubted whether Ryanair could drive its fares even lower. Well today we prove the doubters wrong. From 16th March next, Ryanair will reduce its fares by almost 10% across the board. Ryanair will also become the first low fares airline in Europe to make web check-in available for all our customers and we believe that this service will prove enormously attractive to passengers who wish to avoid those frustrating queues at airport check-in, at security, and at the boarding gate as well.
 
“These changes will also be welcomed by the overwhelming majority of our remaining passengers who will still be checking in one bag, as these passengers will enjoy lower air fares, but also shorter and faster moving queues at airport check-in. We have no doubt that this pioneering development for checked in bags is the way forward, as it will encourage and incentivise more passengers on short-haul journeys to travel with hand luggage only. Ryanair’s higher carry-on limit of 10kgs, and our new increased checked in allowance of 20kgs will largely eliminate excess baggage charges.
 
“These changes will enable Ryanair to reduce our airport and handling costs across the network. We will require fewer and less expensive airport facilities such as airport check-in and baggage hall facilities. We will carry fewer bags making our aircraft lighter and improving our fuel consumption. Our existing check-in and baggage handling personnel will now be able to accommodate significantly greater traffic numbers as we aim to double the size of the airline over the coming five years.
 
“Ryanair started the low fares revolution in Europe back in 1990. We have continued to pioneer changes in both the cost and practice of air travel over the past 15 years. Today’s announcement takes this revolution one step further. With a 9% reduction in Europe’s lowest air fares and the first web check-in facility for low fare passengers, we believe that up to half of Ryanair’s passengers will now be encouraged to avoid airport queues. Short-haul travel in Europe will never have been cheaper or more convenient than Ryanair will make it this year”.
 
 

 


Ryanair footer