Ryanair to raise baggage charges

RYANAIR will hit holidaymakers at the peak of the summer season by hiking baggage charges by a third.

The move will mean checked-in luggage charges will have surged 470% in four years from €3.25 per bag checked-in online in March 2006 to €20 in July and August this year.

The price per bag checked in online is going up from €15. The cost rises to €40 if the bag is checked in at the airport.

In March 2006 Ryanair announced it would be charging for checked-in luggage by slapping a €3.50 charge on its customers. This move was shortly followed by other airlines.

The new charges applied from midnight last night with Ryanair saying the move was to “incentivise all of its passengers to travel light during the peak summer months”.

Ryanair’s Stephen McNamara said: “From September 1 the checked-in bag fee will return to its current level of €15. Over 70% of all Ryanair passengers will be unaffected by these changes because they travel with no checked-in bags.”

Last week, Ryanair raised its profit guidance for thefinancial year that has just ended from €275m to at least €310m after stronger-than-expected passenger bookings, at better than expected yields, during late February and March and in the run-up to the Easter holiday weekend.

Davy analyst, Stephen Furlong said: “We believe that this represents a tipping point on yields, which have fallen by over 20% over the last three years from peak to trough.” Davy believes the likely causes of the improvement are competitor capacity takeout over the last year, a strong mix of new bases and routes and more year-round early sun routes.

“Ryanair has also been paring back the level of aggressive discounting relative to last year as competitors raise prices,” said Mr Furlong.

Davy is raising its price target for Ryanair to 500c. The shares closed virtually unchanged yesterday at €3.97.

Meanwhile, according to the airline’s in-flight magazine, it is pushing ahead with controversial plans to charge passengers for use of toilets. The airline is believed to be working with Boeing to redesign the cabin and develop coin-operated toilets on 168 of its planes.

It is understood, however, that the charges would not be coming in this summer.