OFT boss attacks Ryanair charges
04.01.10
The boss of Britain's top business regulator has accused Ryanair of ‘almost taunting’ passengers in a strongly worded attack on its various add-on charges, the Independent reports. John Fingleton, the chief executive of the Office of Fair Trading, described Ryanair's levying of fees for paying by card online as ‘puerile’ and ‘almost childish’, adding the airline was only operating within ‘the narrow letter of the law’.
The airline – along with other airlines and ticketing agencies – is being investigated by the OFT over online pricing and advertising. Of particular concern is ‘drip-pricing’ where shoppers only discover the full cost of a service late in the booking process, which makes it difficult to compare prices and to shop around.
Under consumer law, businesses must advertise all compulsory charges. At the payment stage online, Ryanair levies a £5 debit or credit card charge per passenger, per journey, although the cost to the company is only about 30p per payment, according to the card industry. The charges can add £40 to the cost of a return trip for a family of four – a massive profit margin on the cost to the airline.
Ryanair advertises taxes and other fees upfront but only mentions charges for paying by using a credit or debit card at the end of booking on the grounds that customers could escape the fee by using an obscure prepaid card.
Mr Fingleton told the newspaper: ‘Ryanair has this funny game where they have found some low frequency payment mechanism and say: 'Well, because you can pay with that [the charge is optional]'. It's almost like taunting consumers and pointing out: 'Oh well, we know this is completely outside the spirit of the law, but we think it's within the narrow letter of the law'.’
Ryanair Head of Communications Stephen McNamara said: ‘Ryanair is not for the overpaid John Fingletons of this world but for the everyday Joe Bloggs who opt for Ryanair's guaranteed lowest fares because we give them the opportunity to fly across 26 European countries for free, £5 and £10.'
‘What the OFT must realise is that passengers prefer Ryanair's model as it allows them to avoid costs, such as baggage charges, which are still included in the high fares of high cost, fuel surcharging, strike-threatened airlines such as BA.’
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