Ryanair and Niki Lauda partner on new Austria airline

Eleanor Steed
By Eleanor Steed March 20, 2018 18:03

Ryanair and Niki Lauda partner on new Austria airline

Ryanair has entered into a binding agreement with Niki Lauda to support his plan to develop and grow LaudaMotion, an Austrian Airline based in Vienna.

LaudaMotion is an Austrian AOC holder owned by Niki Lauda, which has recently acquired many of the assets, including A320 aircraft, of the former Niki Airline, and will shortly start a range of scheduled and charter services from Germany, Austria and Switzerland primarily to Mediterranean leisure destinations.

Under this agreement Ryanair will acquire an initial 24.9% stake in LaudaMotion and this will rise as soon as possible to 75% subject to EU Competition approval. Niki Lauda will chair the Board of the airline and oversee the implementation of his strategy to build a successful Austrian low fares airline. Ryanair will provide financial and management support to LaudaMotion as well as six wet-lease aircraft for S2018 to enable LaudaMotion to complete an extensive 21 aircraft flying program.

The cost of this 75% investment in LaudaMotion (if approved by the EU) will be less than €50m although Ryanair will provide an additional €50m for year one start up and operating costs. Both Lauda and Ryanair will work with the existing management team of LaudaMotion and expect the airline to reach profitability by year three of operations if their plan to grow the business to a fleet of at least 30 Airbus aircraft is successful.

“We look forward to working in partnership with Niki Lauda to successfully develop his vision for a successful Austrian low fares airline to service the schedule and charter markets,” said Ryanair’s Michael O’Leary. “The LaudaMotion AOC will support a fleet of Airbus aircraft which is something we have hoped to develop within the Ryanair Group for some years. LaudaMotion will benefit from this partnership between Niki Lauda and Ryanair. With access to the Ryanair fleet and financial resources, LaudaMotion will now grow more rapidly, as it seeks to compete in a market which is dominated by Lufthansa’s high airfares with its Swiss and Austrian subsidiaries.”

Niki Lauda, Chairman of LaudaMotion said that through the partnership with Ryanair, “Laudamotion will be able to establish itself as a strong competitor and to grow quickly and sustainably. A new player in the aviation market is born and I am looking forward to offering our passengers an extensive route portfolio at competitive air fares.”

Eleanor Steed
By Eleanor Steed March 20, 2018 18:03