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Ryanair cuts target by 10 million passengers, winter a 'write-off' - CEO

(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.

FILE PHOTO: Ryanair logo is pictured on the the jacket of a cabin crew member ahead of a news conference by Ryanair union representatives in Brussels, Belgium September 13, 2018. REUTERS/Francois Lenoir/File Photo

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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