SAA to pursue Ryanair for €2m compemsation

The Irish Times reports that the Shannon Airport Authority (SAA) is to pursue Ryanair for €2m in compensation for breaching the terms of a five year deal which is due to expire at the end of April next year. Under the terms of the agreement which is tied into the number passengers delivered by Ryanair, the airline is understood to pay between €1 and €2 per passenger in handling fees as against the airport's published fee of €4.

Last year Ryanair carried almost 1.2m passengers through Shannon but expects to carry only 800,000 this year which is well short of the 1.9m target for the final of the five years covered by the incentive deal. If the airline falls short of it's target it is required to pay the full fee on the difference.

Last week Ryanair announced that it was reducing it's base strength at Shannon this winter from 4 to 3 aircraft and making 50 staff redundant in the process. The airline blames the €10 travel tax implemented in last October's budget for causing the reduction in passenger numbers and thereby voiding the agreement.

Ryanair are understood to have made a proposal to the SAA for a new deal once the current agreement runs out at the end of April next year but has warned that the future of the Shannon base is in doubt if there is any increase in costs.