Oil prices hit airline capacity

Airlines have said they are slashing their passenger numbers, blaming the surging price of oil for the cutbacks.

Ryanair's chief executive Michael O'Leary said numbers out of Dublin Airport will be reduced by around half a million this winter, a reduction of around 12 per cent on the same season last year.

He said: "We regret this significant capacity reduction at Dublin Airport this winter. It will be the first time for many years that Ryanair has reduced capacity at Dublin Airport."

A Ryanair statement said: "Compared to winter 2007, when Ryanair operated 22 aircraft, and over 1,350 weekly flights, Ryanair's schedule at Dublin this winter will be reduced to 18 based aircraft and less than 1,200 weekly flights."

Meanwhile, British Airways said it expects to cut capacity by 3 to 5 per cent during the season.

Chief executive Willie Walsh said: "We are beginning to see the impact of high energy prices and high food prices coming through."

Mr Walsh said there were no plans to terminate long-haul routes but said the airline could cut back on the frequency of flights. He added there could be "one or two" short-haul suspensions.

BA said it would be "a considerable achievement" if the airline broke even this year.

Meanwhile, both Mr Walsh and BA chairman Martin Broughton apologised to shareholders for the shambolic opening of Heathrow's Terminal 5 last March when flights were cancelled, bags went astray and huge queues developed.

On T5, Mr Walsh said: "We made mistakes and we let people down. Though the mistakes were by no means the sole preserve of BA, we held our hands up, we took responsibility and we apologised."

But both said T5 was now working well and customers had told them they were pleased with the new £4.3 billion facility.

Mr Walsh said he had received letters and emails on a daily basis from customers praising T5 "and remarking on how superior it is compared with the older terminals at Heathrow".

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