This is very big, and good, news for Lithuania and all the Baltics. Ryanair is ready to invest in Lithuania, at a time it needs it the most, and no doubt using some of it’s “muscle” to get lower taxes from both the local authorities and the airport authorities.
I’d love to see the actual numbers, because I think the calculation of the 140 million dollars is not FDI, but rather money that takes into account the number of planes being stationed there, the number of routes that Ryanair promised to have from Kaunas, and with it the pilots, flight attendants and other airport staff. So it’s a little naive to believe there’s a big fat check coming from Ryanair to Kaunas. But still it’s a positive investment.
On the other hand, who seems more and more distant from the rest of Europe and form the lowcost hubs of Eastern Europe, is Tallinn. I had the opportunity to speak to the head of Tallinn Airport last December, and he told me they have no plans to decrease their fees to accommodate a low cost airline like Ryanair. Of course everyone in Estonia wants more low cost companies operating here, but they are simply not willing to go bellow operating costs to have Ryanair fly here.
That decision means that the Tallinn Airport company won’t be asking the government for support just to attract more airlines here. It’s a fiscally responsible decision, and I respect it. But you can’t ignore the fact that Riga, and now Kaunas, are becoming what Tallinn long ago sought to be. The low cost airline, and business hub of the Baltics.
Ryanair to put $140 million in Lithuanian hub
(AP) –
4 days ago
VILNIUS, Lithuania — Budget airline Ryanair will establish a major hub in the Lithuanian city of Kaunas, its first in Central and Eastern Europe, the company’s chief executive announced Tuesday.
Ryanair will $140 million into the project, CEO Michael O'Leary told reporters in Vilnius, Lithuania’s capital, adding that Ryanair would introduce 18 new routes from Kaunas and employ 150 pilots and flight attendants to serve them.
Ryanair has been searching for a hub in Eastern Europe for several years, and O'Leary said the discount carrier chose Lithuania because of its attractive business climate, good infrastructure and rapidly growing passenger numbers.
Kaunas authorities slashed airport taxes last year after Lithuania’s main carrier, flyLAL, was forced into bankruptcy, depriving the country of its own airline.
Ryanair will allocate two new Boeing 737-800 aircraft to the Kaunas hub, O'Leary said. He said he expected passenger numbers at the Kaunas airport to more than double this year to 1 million. The hub is also expected to create 1,000 jobs.
Kaunas, an hour’s drive from Vilnius, is Lithuania’s No. 2 city but has one of the highest rates of joblessness in the Baltic state of 3.4 million people.
O'Leary said Ryanair was considering opening other hubs in Eastern Europe.
