Environment analysis of Ryanair Ryan Air

Running head: CASE STUDY ANALYSIS
Ryanair: Case Study Analysis
Name of the Student:
Name of the University:
Author note:

1CASE STUDY ANALYSIS
Environment analysis of Ryanair
Ryan Air is a low budget airlines, founded in Ireland in 1984. It consists of the biggest
section of the Ryanair Holdings Inc. and it’s sister airlines are Ryanair UK, Ryanair Sun, Buzz,
Malta Air and Lauda (Ryanair.com 2020). The airlines became the biggest European budget
airline in 2016 by the number of scheduled passenger flown and number of international
passengers. Ryanair connects more than 200 destinations in almost 40 countries with a fleet of
more than 470 aircrafts and has around 19000 skilled professionals (Ryanair.com 2020). It is also
the cleanest and greenest airline group in Europe with a leading safety record. Despite having a
high success rate, Ryanair is experiencing quite a few issues in the recent times, which are
accompanied by increasing cost of operations. Along with those, the business performance of
Ryanair is also being affected due to the Brexit uncertainties and consequent employment and
labor regulations. The issues of Ryanair are further aggravated due to the negative media
coverage on the customer service, employee relations and disputes. Hence, to address a major
issue of the budget airline, environment analysis will be performed and a potential solution will
be recommended based on management concepts.
Environmental analysis of an organization consists of internal and external environment.
SWOT analysis is performed to analyze the internal environment, which stands for Strengths,
Weaknesses, Opportunities and Threats for the organization and PESTLE analysis is conducted
to evaluate the external environment of the organization. PESTLE stands for political, economic,
social, technological, legal and environmental factors that are external aspects influencing the
business performance (Rothaermel 2016).

2CASE STUDY ANALYSIS
SWOT analysis of Ryanair
Strengths
 Low cost is the key strength giving
competitive advantage (Ryanair.com 2020)
 Low price airline as the average prices are
less than the average fare for the short haul
flights of rival airlines
 Balance sheet is strong with consistent
returns for shareholders
 Innovation in services and pioneer for
introducing online check in, direct or
online distribution, hand luggage only
travel and automated bag drop facilities
(Madar 2018)
 Biggest short haul network in Europe with
point to point service, which connected
many small airports and lesser known
regions in the Europe (Ryanair.com 2020).
 Higher economies of scale and flexibility in
aircraft deployment, crew training and
rostering due to operating a single type of
fleet, that is, Boeing 737-800.
Weaknesses
 Inefficient management of employee
relations observed in 2018 as pilots and
cabin crew walked out over work and pay
conditions (Madar 2018).
 Brand perception went down due to
increasing flight cancellations, and strikes
as per recent passenger surveys.
 Seasonality of earnings is quite high and
hence, winter quarters in almost every year
experience losses in revenue (Ahmed et al.
2019)
 For keeping costs and turnaround times
low, the flying time of Ryanair is quite
inconvenient for the business travellers
(Madar 2018)
 Lower frequencies of flights on the routes
for keeping cost low.
Opportunities
 Major presence in the UK and the EU with
expanding growth opportunities in future
with a target of 120 million passengers
annually in the coming decade (Ahmed et
al. 2019).
 Improving customer service through
Threats
 Devalued GBP after Brexit lowering the
prices (Ahmed et al. 2019)
 Fuel price rise and fluctuations affecting
business profitability
 Increasing competition from other domestic

3CASE STUDY ANALYSIS
redesigned website, more user friendly
services, smart mobile app, cut in the
boarding pass printing charge, relaxation in
baggage restrictions for cabin and check-in
luggage, etc.
 Loyalty programs introduced for business
passengers to increase their numbers
 Business Traveller product was introduced
for the Business Class, which has facilities
like flexible booking, reserved seating
choice in premium rows, fast lane security
and one free checked bag (Ahmed et al.
2019). This aims to attract the large and
growing number of business class
travellers.
 Fleet expansion will be done using new
fuel efficient aircrafts
and international low budget carriers
 Rise in the rates of Irish Corporation tax
 Increase in airport and navigation charges
and air travel taxes (centreforaviation.com
2019)
Table 1: SWOT analysis of Ryanair
PESTLE analysis of Ryanair
Political
 Commercial air travel tax is highest in the UK for both short and
long haul travel. In last 24 years, the tax rate was tripled by the
UK government and is expected to grow further, affecting visitor
inflow in the UK and that would affect profitability of Ryanair
(Gupta, Gupta and Gupta 2019).
 Severe political uncertainty due to Brexit referendum and its exit
deals with the EU. Brexit might affect multiple flying routes of
Ryanair in many EU nations.
 Market share in the EU and unrestricted access could be lost by