Oireachtas Joint and Select Committees

Thursday, 2 April 2015

Joint Oireachtas Committee on Transport and Communications

Proposed Sale of Aer Lingus: (Resumed) Virgin Atlantic Airlines

10:30 am

Photo of John O'MahonyJohn O'Mahony (Mayo, Fine Gael) | Oireachtas source

I thank Mr. Thompson for his presentation. The committee has heard from many stakeholders and interested parties and that is the reason we invited Virgin Atlantic to appear before us this morning. Our role is to feed into the ongoing debate between Government and IAG regarding this proposal. As Chairman, I can speak for all members when I state that our objective is to ensure the outcome of the debate will deliver the correct decision in Ireland's best interests.

Mr. Thompson's presentation focused on current Aer Lingus passengers who travel to the United Kingdom and connect to Virgin Atlantic flights. In that context I understand that Delta Air Lines, Inc. owns 49% of Virgin Atlantic, which I presume gives Virgin Atlantic certain advantages. Does Mr. Thompson see that a deal between IAG and Aer Lingus would give Aer Lingus similar advantages in that Aer Lingus would retain its identity but would leverage the benefits of an international airline group? Are there positives for Aer Lingus in this arrangement?

Mr. Thompson made the point that low cost carriers, such as Ryanair, are not suitable for people seeking to make connecting flights. I was puzzled by that assertion. I understand from figures that more than 1 million Ryanair passengers made the decision to self-connect to other flights last year. We are seeing more people making personal arrangements to use a carrier from the United Kingdom. People from within the United Kingdom, Edinburgh, Glasgow Belfast and Jersey are making these arrangements as well as those flying from Dublin. In light of that, does Mr. Thompson's assertion sound elitist?

Mr. Thompson has expressed concern for Irish passengers if there was a reduction in the number of Aer Lingus and BA flights between the UK and Ireland following the proposed sale. The point made is that British Airways, BA, fly into Ireland. Has Virgin Atlantic considered operating a service between the United Kingdom and Ireland? Given his concern for Irish passengers connecting to Virgin Atlantic flights, would this be one way of protecting those passengers?

Has Virgin Atlantic or Delta Air Lines, Inc. considered making a bid for Aer Lingus? If not, why not? The reason that IAG was the first group to be invited to appear before the committee to engage in this series of debates was that it had made a proposal to bid for Aer Lingus. Would a link up between Aer Lingus and IAG make Aer Lingus a greater threat to Virgin Atlantic on the transatlantic route?

I am not sure how the different international aviation companies object to each other but has Virgin Atlantic complained before about deals in which IAG was involved or, similarly, did IAG object to deals that Virgin Atlantic proposed?

I have confined myself to putting questions, and I have more, but to be fair to members, they will have the opportunity to put their questions following Mr. Thompson's response to mine.

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