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UPDATE 1-Ryanair cuts target by 10 mln passengers, winter a 'write-off' -CEO

Wed, 9th Sep 2020 09:24

* Cuts target to 50 million

* That would be a third of last year's total

* Winter likely a 'write-off' -CEO

* To cut capacity in UK, Spain
(Adds detail)

By Conor Humphries

Sept 9 (Reuters) - Ryanair has cut its annual
passenger target to 50 million passengers from a forecast of 60
million made in July as COVID-19 renders the winter a
"write-off", Group Chief Executive Michael O'Leary told Reuters
in an interview on Wednesday.

The Irish airline, Europe's largest low-cost carrier, in
July cut its passenger target to 60 million for the financial
year to March 2021, from the 80 million it had forecast in May.

But a spike in COVID-19 cases and the poor performance of
some EU governments has cut that and the number to 50 million -
one-third of the level of last year - and it may go lower,
O'Leary said.

"We are guiding now for about 50 million passengers for the
full year to the end of March," he said, estimating an average
of around 5 million passenger per month for the winter.

"I think at the moment the way governments are handling it
the risk is to the downside," he said.

The move follows similar comments from British rival easyJet
on Tuesday, which said it expected to fly slightly less than the
40% planned capacity for the final quarter of its financial
year.

Fares will also be "aggressively down" as airlines launch
seat-sales to stimulate demand, O'Leary said.

"We're hoping to see a vaccine emerge maybe in the first
quarter of next year... but I think the winter of 2020 will
essentially be a write-off."

As a result Ryanair will have to close some bases and cut
capacity at others, he said, mentioning Britain, Ireland, Spain
and Portugal.

"We're probably looking at closing more bases and
withdrawing more capacity in those countries where you're
operating completely defective and non-scientific quarantines."

Capacity may be added in other countries such as Germany and
Italy, he said.

O'Leary said he expected Ryanair would shed significantly
less than the 3,000 jobs it warned of earlier in the crisis.

"But you know, we're not at the end of this yet. These are
going to be very challenging times this winter," he said.
(Reporting by Conor Humphries; editing by Jason Neely)

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