Like them or loathe them as a customer, as a businessman, it’s very hard not to admire the success and growth that Ryanair has achieved since its inaugural flight on 8 July 1985, with a 15-seat Embraer Bandeirante turboprop flying from Waterford (Ireland) to London Gatwick.

Interestingly, their first £99 flight price is probably higher than most of their fares this August, as excess flight stock for the first time is coming home to roost for low-cost carriers that appeared to know no restrictions on growth.

Ryanair has always known who to attack with their low fares model, and after devastating Irish flag carriers like Aer Lingus, they have moved around Europe picking off one fat scheduled airline after another, whilst keeping a healthy competition with the likes of EasyJet and Jet2.com.

Few global airlines have been shaped by just one person; however, the arrival of a young Michael O’Leary in 1988, when he was promoted from Tony Ryan’s personal aide to Chief Financial Officer of the rapidly expanding Ryanair, is a notable example. For me, this was a key milestone in their history because of the low-cost model he introduced.

In 1990, confronted with financial peril, O’Leary is credited with restructuring the airlines to a “no-frills” budget carrier openly modelled after the successful USA carrier Southwest Airlines. Ryanair quickly eliminated business class and free in-flight meals, standardised its fleet to a single aircraft type, and targeted a 25-minute turnaround for flights, a model it’s never strayed from since.

From its modest beginnings at Stansted in 1991, Ryanair has steadily negotiated with underutilised airports and weak tourist boards to secure operating subsidies. These, along with its bulk purchasing of aircraft, have given it an estimated 30% lower operating cost per seat compared to competitors like EasyJet and Jet2.

This has undoubtedly been a key driver of Ryanair’s success, as although many customers dislike Ryanair’s harsh customer service ethos, they continue to book by the millions, as Ryanair delivers the best on-time arrival statistics of any low-cost airline in the sector and unbeatable prices.

Let’s face it, when it’s a 2-4 hour short-haul flight, convenient local airports and ultra-low prices will trump national carriers and often competing low-cost operations.

The airline would not have achieved this dominance if it had not been for some bold decision-making along the way, such as outrightly turning down a takeover bid by Aer Lingus in its early days in 1993 and launching the public IPO in 1997 that allowed it to raise the funds needed for a $2 billion deal for 45 Boeing 737-800s, which is credited with beginning the airline’s operational efficiency advantage.

However, it was Ryanair’s early adoption of the Internet and the creation of a direct-sell airline, which outright rejected traditional sales methods such as travel agents, that propelled its rapid growth in the early 2000s.

I therefore find it ironic that Ryanair has finally realised it is missing out on this channel after watching its rivals, Jet2 and later EasyJet, develop highly profitable tour operations to replace the giant, vertically integrated tour operators that its low-cost yield model had destroyed.

For years, Ryanair did not realise how many millions of their seats were being included in holidays sold by OTAs and travel agents using Dynamic Packaging tools. However, their attempt to block this route in January 2024 through strict identity verification rules for customers who booked via third parties backfired dramatically, causing an immediate drop in both load factors and seat yields.

Again, Ryanair’s reaction was quick and bold. From one day calling third-party agents ‘Pirates’ for illegally adding charges to Ryanair flights, O’Leary quietly made a 360-degree turn and struck deals with all the major UK OTAs, developing a fee-free API that has taken a large share of seat sales from rivals EasyJet and Jet2.

Transforming from the anti-Christ to the preferred affordable partner of OTAs took less than six months and has opened a new route to reach’ Package Holiday’ customers without the hassle of developing their own technology, distribution, or incurring ATOL liabilities.

However, Ryanair are leaving a large part of the holiday profit in third-party hands and not exploiting the free spin-off traffic from their airline site in the same way Easyjet is.

EasyJet Holidays is highly profitable, primarily because it has very low customer acquisition costs, as most of its traffic originates from EasyJet brand searches, rather than costly Google advertising for destinations, resorts, or hotels.

Not owning the profits from the tour operation also prevents Ryanair from using holiday packages as a convenient and opaque way to dump excess seats into package holidays discreetly.

Given that 2025 is the summer when the wave of low-cost expansion finally ran aground on the rocks of excess capacity, there is only one logical next step.

My prediction is that Ryanair will take a bold step again and acquire both the privately owned Love Holidays and the publicly listed On the Beach holidays, to gain control of a substantial 7 million share of the package holiday market. To put things into perspective, it will cost Ryanair less than the price of 10 aircraft if they manage to secure both for the estimated $ 1 billion required.

Ryanair’s customer service ethos might stop its brand from becoming a package holiday provider, but targeting 70% of these newly acquired OTAs’ flight stock to be Ryanair via these established holiday brands is achievable and offers multiple benefits.

Watch this space, as Ryanair is not going to slow down, even at the age of 40, and will continue to make bold decisions under O’Leary.