Oireachtas Joint and Select Committees

Tuesday, 17 February 2015

Joint Oireachtas Committee on Transport and Communications

Proposed Sale of Aer Lingus: (Resumed) Aer Lingus and Stobart Air

5:00 pm

Mr. Stephen Kavanagh:

I will restate our position. The sustainability of routes is best protected by profitability. In my diagnosis, the ability to renegotiate regularly with suppliers has a greater beneficial impact on profitability than long-term commitments. A long-term commitment is simply ceding too much commercial value and weakens services. Just as our consumers shop around, an airline must be able to shop around for the services provided, including the rates paid at Shannon and Cork Airports. IAG has communicated this as its rationale behind the five-year commitment. I concur with that sentiment in protecting profitability on its routes.