Published 18:25 IST, June 25th 2020
Ryanair will challenge German govt's decision to provide state aid to Lufthansa: CEO
Ryanair itself was seeking aid from the British government until last month saying that it is facing a challenge because its competitors are getting a subsidy.
- World News
- 2 min read
Ryanair on June 23 said it will challenge the German government's bailout to its rival airline Lufthansa in European courts. According to reports, the German government agreed to provide €9 billion to Lufthansa airline in exchange for a 20 per cent stake in the company. The decision was made keeping in mind the losses incurred by the company during coronavirus lockdown, but Ryanair accuses the bailout to be illegal state aid.
Michael O’Leary, Ryanair Holdings chief executive in a statement declared that the company will challenge the recent example of illegal state aid that will distort the level playing field in the industry, including competition. The Irish airline accuses that Lufthansa will use the state aid to lower the cost of its flight tickets that will directly impact its rival, including Ryanair, EasyJet, British Airways
Ryanair itself was seeking aid from the British government until last month saying that it is facing a challenge because its competitors in Europe, such as Air France and Lufthansa are getting subsidy from the state and are also hoovering up for payroll support schemes. O'Leary said that these airlines will be able to fly on low-cost for up to five years because of government support and Ryanair will face unfair competition s a result of that. However, the British government denied providing any support to airline companies.
Ryanair lays-off workers
Ryanair, Europe’s largest low fares airline suffering from the coronavirus lockdown as well and it fears that the aid provided to Lufthansa by the german government would jeopardise its standing in the industry. Ryanair is cutting jobs to deal with the coronavirus crisis. The airline on May 15 announced that it has reduced its office headcount in Dublin, Stansted, Madrid, and Wroclaw by over 250. Earlier this month, the Irish airline had announced that it planned to cut 15 percent of its workforce, which is about 3,000 staff members due to coronavirus lockdown.
(Image Credit: AP)
Updated 18:25 IST, June 25th 2020