European ultra low cost carrier Ryanair is known for its incredibly low base fares, and endless optional fees. Over time, the airline has faced quite a bit of regulatory scrutiny over how it does business.
Just last week I wrote about how the airline “reluctantly” updated its family seating policy, after facing scrutiny in the United Kingdom. Now the airline is potentially facing an even bigger challenge in Austria, as the country’s highest court may force the airline to make several updates to its pricing structure.
In this post:
Austrian supreme court rules that Ryanair’s terms are unlawful
In recent times we’ve seen the Austrian Consumer Information Association (VKI) challenge aspects of Ryanair’s terms & conditions in court, and the case went all the way to the country’s supreme court.
The court has now ruled that 14 clauses in Ryanair’s terms & conditions are unlawful, and is requiring Ryanair to stop using the contested clauses in the country within three months. The main fee that was being challenged is Ryanair’s €55 airport check-in fee, which is quite controversial, naturally. Beyond that, though, the court also ruled that the €15 boarding pass fee, €25 infant fee, €70 oversized hand baggage fee, and €100 rebooking fee for missed flights, are all unfair and not transparent.
The consumer organization claims that those who paid these fees in the past are entitled to a refund, though Ryanair denies that claim, and I imagine that this isn’t the end of litigation that we’re going to see.
This ruling all centers around Ryanair violating Section 879(3) of the Austrian Civil Code (ABGB), which says the following:
“A contractual provision contained in general terms and conditions (Allgemeine Geschäftsbedingungen, AGB) or standard contract forms, which does not determine one of the principal obligations of the parties, is void in any event if, taking into account all the circumstances of the case, it places one party at a gross disadvantage.”
Will Ryanair have to radically alter its business model?
Ryanair is the most flown airline in Europe, and while it maybe doesn’t have the best reputation, people fly with the carrier for its nonstop routes, low fares, and reliability. While Ryanair is largely villainized for how its fares are structured, I personally kind of feel like there’s a bit of over regulation with the airline.
If you ask me, Ryanair is mostly transparent about what is and isn’t included with tickets. Just because the airline has an unconventional pricing model doesn’t mean there’s anything wrong with it, in my opinion. Now, let me say that I’m not a fan of some of Ryanair’s labor practices to keep costs down, but that’s a different topic, separate from this debate about consumer protection.
Anyway, Ryanair has long played hardball with regulators, and has sort of gone on the offense against them. However, it sure feels to me like Ryanair is facing an increasing amount of scrutiny which might really challenge the carrier’s approach to how it sells tickets.
For example, what if Ryanair is actually forced to comply with these new regulations within three months? As I see it, there are three ways this could play out:
- The airline could simply discontinue all flights to Austria, to send a message to other regulators, viewing this as an existential “line in the sand”
- The airline could update its policies across the board for all flights, but that would represent a radical departure from the Ryanair business model that people know
- The airline could simply update its rules for flights to and from Austria, which seems like it would create even more consumer confusion, and would likely only lead to other regulators following Austria’s lead
Between this and the European Union soon updating rules around how fares can be marketed (to require a carry-on with the advertised fare), I imagine there must be some cussing going on at Ryanair headquarters in Dublin.
Bottom line
The Austrian supreme court has ruled that many aspects of Ryanair’s terms & conditions are unlawful, including fees for airport check-in, printing boarding passes, and much more. The argument is that these terms put consumers at a gross disadvantage.
While Ryanair’s fee structure is disliked by many, that’s balanced by low base fares, and I personally think the airline is fairly transparent. Ryanair now has three months to update its rules for Austrian consumers, so I’m curious to see how this goes.
What do you make of Austria’s supreme court ruling on Ryanair?
It's kind of interesting to see in the US that customer preferences are pushing all airlines to become the same airline in different liveries, while in Europe it looks like the government is pushing all airlines to become the same airline in different liveries
It already doesn't fly to Austria. It goes to "Bratislava Vienna".
5 Austrian destinations including actual Vienna. :rolleyes:
When you use the Pick a Country, it shows 4 Austrian departure airports: Klagenfurt, Linz, Salzburg and Vienna.
So Bratislava isn't included, and the 5th Austrian destination isn't included.
Perhaps ORD was not counting Lauda Air destinations as Ryanair destinations, but Lauda is fully owned by Ryanair and they are different flavours of the same company.
Debundling makes sense if the costs to customers are in line with the cost to provide.
Ie, take away the free meal and replace with $10 optional purchase. It can be argued that $10 is a reasonable cost for a sandwich because that's in line with what others charge.
But it doesn't cost Ryanair €55 to provide airport check-in services, it's there as a punitive measure. If you turn up at the airport what are you going to do, not check in?
I'm surprised they don't charge for breathing ssshhh
Ryanair pricing is not "balanced" - it's built on a classically deceptive "bait and switch" scheme, where the airline appears to offer an attractively low fare but then tacks on a bunch of post-purchase extras. You are defending an intentionally deceptive scheme.
maybe doesn’t have the best reputation, people fly with the carrier for its nonstop routes, low fares, and reliability.
RELIABILITY?!?! . . . as much as i think you do know the rules and fine-print of this airline, BUT it most obviously shows that YOU never flew it.
If (and it happens quiet regular on new routes, low season flights, overpriced routes on FR) The airline simply cancels a flight, refunds you the...
maybe doesn’t have the best reputation, people fly with the carrier for its nonstop routes, low fares, and reliability.
RELIABILITY?!?! . . . as much as i think you do know the rules and fine-print of this airline, BUT it most obviously shows that YOU never flew it.
If (and it happens quiet regular on new routes, low season flights, overpriced routes on FR) The airline simply cancels a flight, refunds you the money that you paid often far in advance and this airline worked with it, but since they don't cooperate with any other airline or interline with any IATA carrier, they simply think that's it. Refund the money paid and good, that on some routes the fares from date of purchase till day of flying or their date of cancelling a flight will 100% lead to a higher fare on a competing airline. They DON'T even try to re-book you on any other carrier, unless they have an own flight on the same route, 3 days later!
Reliable . . . has a VERY different meaning to me.
Ryanair is like a bug in a System that's full of parasites already!
Let's hope this new court ruling from Austria is being forced all over Europe!
. . . i personally think, if this would just be an example for other states too, i bet RELIABILITY in aviation will climb to a different level again, also within so called legendary carriers like LH-Group or IAG. Those are not just bugs, these are those parasites that constantly try to overrule ANY government with an entire crew of lawyers and corrupt politicians in each country, to get what they want.
So: Fair rules and fees all over!
NO exceptions for Lowcost, non IATA or Charter carriers (cockpit visits mid-air, wild alcohol parties with obvious drunk charter passengers) . . . ALL this needs rules from the head of it all. IATA and federal aviation offices globally . . . so that flying becomes safe and reliable as it is supposed to be!
People forget, that you DON'T always get, what you pay for! 55€ for check-in at the airport instead of online, what do i get for those 55€, a paper receipt, nothing else! It's NOT worth the charged fee! Time to set examples!
NO special treatments of carriers that think, they can set their own standards and rules.
Airfares are regulated, so why are not ALL rules of carriage are standardized too?
It's all politics! . . . time to regulate this entire industry and make it a FAIRPLAY game for all, airlines, regulators AND paying passengers. (GLOBALLY) Kudos to Austrian supreme Court and the AT Consumer Information Association. 1 step in the right direction.
To me it is fairly simple. If it is obligatory to do something like check in, how can there be a fee for that. It's not optional. Other fees like oversized carry-on, all excessive, should be permitted. People will decide whether or not they want to keep paying that fee. Perhaps one option is to have everything mandatory included with the price I.e baggage, seat selection, etc. But give a discount if you don't use...
To me it is fairly simple. If it is obligatory to do something like check in, how can there be a fee for that. It's not optional. Other fees like oversized carry-on, all excessive, should be permitted. People will decide whether or not they want to keep paying that fee. Perhaps one option is to have everything mandatory included with the price I.e baggage, seat selection, etc. But give a discount if you don't use those things. No one complains about getting a discount.
Airlines have been fee-scamming everyone for some years now . The worse one is the "corkage charge" when they hand you an unopened beer .
what on earth are you on about?
They will pull out before they change their model.
Be careful what you wish for, Austria.
they're well gone!
The start after the "out" of Nikki and airberlin was way too easy for FR to get started to begin with!
Looking at social media, there is that trend right now pushing back on unbundling... with the unreasonable expectation that airfare would stay the same if all the "perks that people used to enjoy for free" would now be rolled back into base airfare. From that perspective, it is not surprising to see the EU somewhat moving in that direction.
Back to the matter at hand, I see a fourth path where Ryanair looks at the...
Looking at social media, there is that trend right now pushing back on unbundling... with the unreasonable expectation that airfare would stay the same if all the "perks that people used to enjoy for free" would now be rolled back into base airfare. From that perspective, it is not surprising to see the EU somewhat moving in that direction.
Back to the matter at hand, I see a fourth path where Ryanair looks at the ruling, and makes minor cosmetic changes to comply, effectively sending the matter back to litigation at some point in the future...
Personally, I don't mind unbundling but hate the lack of price transparency. At this point airlines publish prices no one really pays, just to get on top of the search result. This makes price comparison websites outright useless since the price they display has nothing to do with what I pay. On longhaul J trips I just mentally ignore airlines that offer "business light" fares (Etihad, Qatar etc) unless they're super cheap, but on shorthaul...
Personally, I don't mind unbundling but hate the lack of price transparency. At this point airlines publish prices no one really pays, just to get on top of the search result. This makes price comparison websites outright useless since the price they display has nothing to do with what I pay. On longhaul J trips I just mentally ignore airlines that offer "business light" fares (Etihad, Qatar etc) unless they're super cheap, but on shorthaul economy it's really hard.
As a solution, I'd ideally want a search engine where I can enter what exactly I need (baggage, seating, whatever) and what status I have, and it would produce the actual prices for the stuff I want. But that's unlikely to ever materialize.
@Samo - You're pretty much describing exactly what IATA NDC capability is about.
The BP fee no longer exists. The check-in fee - how many people actually pay that these days? It will hurt a bit, but most people prefer to check-in online. The baggage fee is imho the most problematic and one where I really don't understand the court's reasoning as it's a perfectly logical thing to charge for.
As a side note, FR has been expanding rapidly in BTS in recent months, so I can see this prompting them to move more capacity from VIE to BTS (like W6 did).
There are stories of people who couldn't check in online (e.g. due to having an exotic passport) and were then charged the fee.
I agree that a move to BTS is the most logical response to this ruling - in fact, I'm surprised they're still flying to VIE which must be costlier and more complicated than its Slovakian neighbour.
I think Ryanair doesn't want loose Austrian market. It is a very important VFR market . It will require some changes. These additional fees are getting out of control. Some fees i can understand, but they are ridiculous too high.
FR needs the money!
..... as long as there is no set rules from any higher authority, they will keep doing what they want!