Aer Lingus

Aer Lingus

IATA ICAO Callsign EI EIN SHAMROCK
Founded	15 April 1936 (1936-04-15)
Commenced operations	27 May 1936 (1936-05-27)
Hubs	Dublin
Focus cities	Belfast-City Cork Shannon
Frequent-flyer program	AerClub/Avios[1]
Fleet size	48
Destinations	91
Company slogan	Smart flies Aer Lingus
Parent company	International Airlines Group
Headquarters	Dublin Airport, Ireland
Key people	Stephen Kavanagh, CEO Rachel Izzard, CFO[2]
Revenue	€1,718 million (2015)
Operating income	€140.9 million (2015)
Net income	€117.9 million (2015)
Employees	3,766 (2014)
Website	aerlingus.com

Aer Lingus, (/ˌɛər ˈlɪŋɡəs/, an anglicisation of the Irish aerloingeas^[3][4] meaning "air fleet") is the flag carrier airline of Ireland and the second-largest airline in Ireland. Founded by the Irish government, it was privatised between 2006 and 2015 and it is now a wholly owned subsidiary of International Airlines Group (IAG), the parent company of British Airways and Iberia. The airline's head office is on the grounds of Dublin Airport in Cloghran, County Dublin, Ireland.

Formed in 1936, Aer Lingus is a former member of the Oneworld airline alliance, which it left on 31 March 2007; however, after the takeover by IAG it is expected that Aer Lingus will re-enter Oneworld in the foreseeable future. The airline has codeshares with Oneworld, Star Alliance and SkyTeam members, as well as interline agreements with Etihad Airways, JetBlue Airways and United Airlines. Aer Lingus has a hybrid business model,^[5] operating a mixed fare service^[6] on its European and North African routes and full service, two-class flights on transatlantic routes.

Ryanair used to own over 29% of Aer Lingus stock and the Irish state owned over 25%. These shareholders were lost after IAG bought the airline. The state had previously held an 85% shareholding until the Government's decision to float the company on the Dublin and London Stock Exchanges on 2 October 2006. The principal group companies include Aer Lingus Limited, Aer Lingus Beachey Limited, Aer Lingus (Ireland) Limited and Dirnan Insurance Company Limited, all of which are wholly owned.^[7]

On 26 May 2015, after months of negotiations on a possible IAG takeover, the Irish government agreed to sell its 25% stake in the company. Ryanair retained a 30% stake in Aer Lingus which it agreed to sell to IAG on 10 July 2015 for €2.55 per share.^[8][9] In August 2015, Aer Lingus' shareholders officially accepted IAG's takeover offer.^[10] IAG subsequently assumed control of Aer Lingus on 2 September 2015.^[11]

History

Early years

Aer Lingus was founded on 15 April 1936, with a capital of £100,000. Its first chairman was Seán Ó hUadhaigh.^[12] Pending legislation for Government investment through a parent company, Aer Lingus was associated with Blackpool and West Coast Air Services which advanced the money for the first aircraft, and operated with Aer Lingus under the common title "Irish Sea Airways".^[13][14] Aer Lingus Teoranta was registered as an airline on 22 May 1936.^[15] The name Aer Lingus was proposed by Richard F O'Connor, who was County Cork Surveyor, as well as an aviation enthusiast. Aer Lingus was originally pronounced 'air ling-us' (as the Irish Aer Loingeas is pronounced) and only later did the pronunciation change to the 'air ling-gus' used now.

On 27 May 1936, five days after being registered as an airline, its first service began between Baldonnel Airfield in Dublin and Bristol (Whitchurch) Airport, United Kingdom, using a six-seater de Havilland DH.84 Dragon biplane (registration EI-ABI), named Iolar (Eagle).

Later that year, the airline acquired its second aircraft, a four-engined biplane de Havilland DH.86 Express named "Éire", with a capacity of 14 passengers.^[14] This aircraft provided the first air link between Dublin and London by extending the Bristol service to Croydon. At the same time, the DH.84 Dragon was used to inaugurate an Aer Lingus service on the Dublin-Liverpool route.

The airline was established as the national carrier under the Air Navigation and Transport Act (1936).^[15] In 1937, the Irish government created Aer Rianta (now called Dublin Airport Authority), a company to assume financial responsibility for the new airline and the entire country's civil aviation infrastructure. In April 1937, Aer Lingus became wholly owned by the Irish government via Aer Rianta.

The airline's first General Manager was Dr J.F. (Jeremiah known as 'Jerry') Dempsey, a chartered accountant, who joined the company on secondment from Kennedy Crowley & Co (predecessor to KPMG) as Company Secretary in 1936 (aged 30) and was appointed to the role of General Manager in 1937. He retired 30 years later in 1967 at the age of 60.

In 1938, a de Havilland DH.89 Dragon Rapide replaced Iolar, and the company purchased a second DH.86B. Two Lockheed 14s arrived in 1939, Aer Lingus' first all-metal aircraft.

In January 1940, a new airport opened in the Dublin suburb of Collinstown and Aer Lingus moved its operations there. It purchased a new DC-3 and inaugurated new services to Liverpool and an internal service to Shannon. The airline's services were curtailed during World War II with the sole route being to Liverpool or Barton Aerodrome Manchester depending on the fluctuating security situation.

Post-war expansion

On 9 November 1945, regular services were resumed with an inaugural flight to London. From this point Aer Lingus aircraft, initially mostly Douglas DC-3s, were painted in a silver and green livery. The airline introduced its first flight attendants.

In 1946, a new Anglo-Irish agreement gave Aer Lingus exclusive UK traffic rights from Ireland in exchange for a 40% holding by British Overseas Airways Corporation (BOAC) and British European Airways (BEA). Because of Aer Lingus' growth the airline bought seven new Vickers Viking aircraft in 1947, however, these proved to be uneconomical and were soon sold.

In 1947, Aerlínte Éireann came into existence with the purpose of operating transatlantic flights to New York City from Ireland. The airline ordered five new Lockheed L-749 Constellations, but a change of government and a financial crisis prevented the service from starting. John A Costello, the incoming Fine Gael Taoiseach (Prime Minister), was not a keen supporter of air travel and thought that flying the Atlantic was too grandiose a scheme for a small airline from a small country like Ireland.^[16]

During the late 1940s and early 1950s, Aer Lingus introduced routes to Brussels, Amsterdam via Manchester and to Rome. Because of the expanding route structure the airline became one of the early purchasers of Vickers Viscount 700s in 1951, which were placed in service in April 1954. In 1952, the airline expanded its all-freight services and acquired a small fleet of Bristol 170 Freighters, which remained in service until 1957.

In 1954, Prof. Patrick Lynch was appointed chairman of Aer Lingus and Aer Rianta at the young age of 38, taking on the task of turning the £60,000 deficit into a profit. He was Chairman for 21 years to 1975, and retired from that position at his own request to the government of the day. In 1956, Aer Lingus introduced a new, green-top livery with a white lighting flash down the windows and the Irish flag displayed on the fin.

First transatlantic service

On 28 April 1958, Aerlínte Éireann operated its first transatlantic service from Shannon to New York. Three Lockheed L-1049 Super Constellations were used for the twice-weekly service aboard aircraft leased from the US airline Seaboard and Western with Irish cabin crews. This arrangement continued until 1 January 1960 when Aerlínte Éireann was renamed Aer Lingus – Irish International Airlines.

Aer Lingus bought seven Fokker F27 Friendships, which it received between November 1958 and May 1959. These were used in short-haul services to the UK, gradually replacing the Dakotas, until Aer Lingus disposed of them during 1966 in favour of secondhand Viscount 800s.

The airline entered the jet age on 14 December 1960 when it received three Boeing 720 for use on the New York route and the newest Aer Lingus destination Boston.

In 1963, Aer Lingus added Aviation Traders Carvairs to the fleet. These aircraft could transport five cars which were loaded into the fuselage through the nose of the aircraft. The Carvair proved to be uneconomical for the airline partly due to the rise of auto ferry services, and the aircraft were used for freight services until disposed of.

The Boeing 720s proved to be a success for the airline on the transatlantic routes. To supplement these, Aer Lingus took delivery of its first larger Boeing 707 in 1964, and the type continued to serve the airline until 1986.

Jet aircraft

Conversion of the European fleet to jet equipment began in 1965 when the BAC One-Eleven started services from Dublin and Cork to Paris and via Manchester to Amsterdam, Copenhagen, Düsseldorf and Frankfurt. The airline adopted a new livery in the same year, with a large green shamrock on the fin and titles of Aer Lingus-Irish International just above the windows. In 1966, the remainder of the company's shares held by Aer Rianta were transferred to the Minister for Finance.

In 1966, the company inaugurated a route from Shannon to Montreal and onward to Chicago. In 1968, flights from Belfast, in Northern Ireland, to New York City started, however it was soon suspended due to the beginning of the Troubles. Aer Lingus introduced Boeing 737s to its fleet in 1969 to cope with the high demand for flights between Dublin and London. Later, Aer Lingus extended the 737 flights to all of its European network.

In 1967, after 30 years of service, General Manager Dr. J.F. Dempsey signed the contract for the airline's first two Boeing 747 aircraft before he retired later that year.

1970s to present

On 6 March 1971, Aer Lingus took delivery of the first of two Boeing 747s for use on the transatlantic routes.^[17][18] The company later purchased a third for its fleet but quickly offered it for lease because it was not initially profitable for the company to fly 747s across the Atlantic. In 1974, Aer Lingus unveiled a new livery which eliminated the word International from the fuselage titles. The livery included two colours of blue and one green, plus the white shamrock on the fin.

In 1977, Aer Lingus recruited its first female pilot, Gráinne Cronin – the airline was the second in Europe (after SAS) to introduce female pilots.^[19]

In September 1979, Aer Lingus became the first European airline other than Alitalia to be used by Pope John Paul II, when he flew aboard a specially modified Boeing 747 (EI-ASI or St. Patrick) from Rome to Dublin and later from Shannon to Boston. In the early 1980s the 707s were phased out.

In 1984, the airline formed a fully owned subsidiary, Aer Lingus Commuter, so that Aer Lingus could fly to larger cities in Ireland and Britain whose flying time from Dublin did not require jet aircraft. These services employed five of the Belfast-built Short 360 after conducting a trial with the Short 330. Around this time Aer Lingus purchased a majority sharehold in the cargo airline Aer Turas, owner of some DC-8 freighter jets.

Between 1987 and 1989, new Boeing 737s arrived to replace the older ones, and six Fokker 50s were added to the Commuter fleet. During 1990, after the passage of the deregulation act for the airline industry in Ireland, Aer Lingus reconsidered its operational policies. It retired the BAC One-Elevens and replaced them with five new 737s. In 1991, four Saab 340Bs arrived at the commuter division to replace the Short 360 aircraft. By 1992 Aer Lingus's entire original 737-200 fleet had been replaced and it was now the first carrier in the world operating all three versions of the second generation 737. These were the −300, −400 and −500 series, although the −300 did not stay long in Aer Lingus service.

Airbus operations

In 1994, Aer Lingus started direct services between Dublin and the United States using the Airbus A330 and in May of that year Aer Lingus operated the first A330-300 ETOPS service over the North Atlantic. This led to the phasing out of the Boeing 747 and the briefly operated Boeing 767-300ER. On 2 October 1995, the Boeing 747 service ceased operations after twenty-five years of service. By that time, over eight million people had travelled across the Atlantic in Aer Lingus Boeing 747s. The late 1990s saw Aer Lingus return to Belfast with a service to New York via Shannon. It also added Newark Liberty International Airport as a destination, but discontinued these flights in 2001.

The first Airbus short-haul aircraft arrived in 1998 in the form of the A321, initially to mainly operate the Dublin-Heathrow route. Six were delivered in 1998 and 1999 and three of these continue in service today. The first A320 was delivered in 2000, with three more added to the fleet by 2001.

On 1 February 2001, Aer Lingus Commuter merged back into the mainline operation. Business was severely affected by the 11 September attacks. In response, the airline cut staff numbers and destinations and reduced its fleet. As a result, it weathered the storm and returned to profit, largely through lowering the airline's cost base, updating the fleet with modern Airbus equipment and developing new routes to mainland European destinations. Aer Lingus had previously largely neglected mainland Europe in favour of US and British destinations. It positioned itself as competition to the European no-frills airlines while offering intercontinental flights, phased-out Business class travel for short-haul flights, but retained cargo services on a small number of routes.

A large order for A320 aircraft saw deliveries commencing in 2004 and continuing to 2011. The delivery of these aircraft allowed the withdrawal of the Boeing 737. On 29 October 2005, Aer Lingus withdrew its last two 737 aircraft from service, marking the end of Boeing aircraft at Aer Lingus, and the beginning of an all-Airbus fleet.

On 27 October 2005, Aer Lingus announced its first scheduled service to Asia from March 2006 as Dubai International Airport in the United Arab Emirates, where Chief Executive Dermot Mannion was based when at Emirates.^[20] Despite the Aer Lingus press release describing it as the first long-haul service outside the United States, there had in fact been a previous service to Montreal from 1966 to 1979. The great circle distance of 5,926 kilometres (3,682 mi) is comparable to the service to Chicago. At the same time Mannion linked the funding of new long-haul aircraft to replace the A330 fleet with the privatisation of the airline.^[21] The Dubai service ceased in March 2008 as the airline sought to increase its market share in the newly liberalised transatlantic market.

On 6 June 2007, Aer Lingus strengthened its relationship with the European manufacturer by ordering six of the new A350-900 and six A330-300. These were used to expand long-haul operations as well as replace three older models. Deliveries of the A330 began in February 2009 and in 2011 Aer Lingus switched the remaining three A330 orders to the A350-900 model, with delivery no sooner than 2017.^[22]

Flotation

In preparation for the commercial flotation of Aer Lingus on the Dublin stock market, the Irish government agreed to abolish the Shannon Stopover from the end of 2006 in stages.

The company began conditional (or "grey-market") share dealings on 27 September 2006 and was formally admitted to the Official Lists of the Irish Stock Exchange and London Stock Exchange on 2 October 2006. At the time of the flotation the Irish government maintained a 28% shareholding, while employees held 15%. The stock IPO offer price was E2.20.^[23][24]

Aer Lingus withdrew from the Oneworld airline alliance on 31 March 2007, instead entering into bilateral agreements with airlines including British Airways, Virgin Atlantic, Delta Air Lines, KLM, and United Airlines. Aer Lingus explained the move stating the carrier was repositioning as a low-cost carrier, which did not fit with Oneworld's pitch to the premium international frequent flyer.

On 6 February 2007, however, the airline announced its intention to form a new alliance with JetBlue Airways. This new alliance was to act as a weblink between the two airlines, enabling Aer Lingus customers to book JetBlue destinations from the Aer Lingus website. In 2008, it also announced an alliance with United Airlines for connecting services within the US.

With the flotation of Aer Lingus on the stock exchange, Aer Lingus had planned to expand its route network, but this was put on hold due to the economic situation.

Ryanair takeover bid (2006/2013)

On 5 October 2006, Ryanair launched a bid to buy Aer Lingus. Ryanair CEO Michael O'Leary said the move was a "unique opportunity" to form an Irish airline. The "new" airline would carry over 50 million passengers a year. Ryanair said it had bought a 16% stake in Aer Lingus and was offering €2.80 for the remaining shares.^[25] On the same day Aer Lingus rejected Ryanair's takeover bid.^[26] On 5 October 2006, Ryanair confirmed it had raised its stake to 19.2%, and said it had no problem in the Irish Government keeping its 28.3%. The Irish Times reported that the Government would possibly seek judgement from the courts, and referral to competition authorities in Dublin – although this would be automatic under European regulation, as the combined group would control 78% of the Dublin – London passenger air traffic.^[27]

On 29 November 2006, Ryanair confirmed it had taken its stake to 26.2%.^[28]

On 21 December 2006, Ryanair announced it was withdrawing its bid for Aer Lingus, with the intent of pursuing another bid in the near future after the European Commission finishes investigating the current bid. The EC has been concerned that the takeover would reduce consumer choice and increase fares.^[29]

On 27 June 2007, the European Commission announced its decision to block the bid on competition grounds saying the two airlines controlled more than 80% of all European flights to and from Dublin Airport.^[30]

On 27 February 2013, the European Commission blocked a third attempt by Ryanair to take over Aer Lingus, stating that the merger would have damaged consumers' choice and resulted in increased fares.^[31]

Cross border expansion

On 7 August 2007 the airline announced that it would establish its first base outside the Republic of Ireland at Belfast International Airport in Northern Ireland. Services from Belfast International commenced in December 2007. As of July 2008, the airline has three Airbus A320 aircraft based at the airport, serving eleven European destinations. Significantly, this move restores the Belfast International to London Heathrow Airport link and Aer Lingus cooperates with its codeshare partner British Airways on this route to connect with BA's network at Heathrow. In order to do so, the airline discontinued its Shannon-Heathrow service, a move that generated political controversy in the west of Ireland, particularly as the Shannon-London route was still profitable. The airline predicted that this move would add one million additional passengers annually.^[32][33] The Shannon to Heathrow service has since been reinstated.

After five years at Belfast International Airport, Aer Lingus announced on 19 July 2012 that it would be moving its operations to George Best Belfast City Airport. The airline transferred its Belfast - London Heathrow flights to there, and also announced the operation of a three times daily London Gatwick service, and on 31 March 2013, launched services to Faro and Málaga. Aer Lingus based 2 aircraft in Belfast City Airport for the Winter 2012–2013 season, and a third aircraft arrived for the Summer 2013 season.

Open Skies

On 22 March 2007, as a result of the EU–US Open Skies Agreement, Aer Lingus announced three new long-haul services to the United States. From Autumn 2007, Aer Lingus commenced direct flights to Orlando, San Francisco and Washington, D.C.-Dulles, facilitated by the arrival of two new Airbus A330 aircraft in May 2007. The airline also serves Boston (Logan International Airport), Chicago (O'Hare International Airport), and New York (JFK Airport). Aer Lingus ended its Middle-Eastern Route to Dubai in March 2008, and ended its Los Angeles route in November 2008. The Washington and the San Francisco routes were discontinued as of 24 October 2009. Services from Washington, D.C. resumed on 28 March 2010 when the airline began flights from Washington D.C. to Madrid, Spain in a joint venture with United Airlines. The airline terminated this route on 30 October 2012.^[34] Services from San Francisco have since resumed on 2 April 2014. New Route: Dublin-Washington Aer Lingus has given details of its Summer 2015 schedule which includes the introduction of a new, four times weekly summer service from Dublin to Washington-Dulles starting May 2015. The Dublin-Los Angeles route was reintroduced on 4 May 2016.

Effects of Global Financial Crisis

After reporting losses of €22 million for the first half of the year, in October 2008, Aer Lingus announced a €74 million cost saving plan. This was to involve up to 1,500 job cuts including the loss of cabin crew bases in Shannon and Heathrow. The plan included scaled back ground operations in Cork and Shannon Airports; outsourcing check-in, baggage handling, cargo and catering services in Dublin; reduction in transatlantic services and replacing staff with US-based cabin crew; and a pay freeze through the end of 2009. This met with a largely negative response particularly from trade unions.^[35] These cutbacks have since been cancelled, and new cutbacks including lower pay and a change in working conditions for ground staff have been implemented.

In December 2008, Aer Lingus announced that the Shannon – Heathrow service would resume from 29 March 2009 following new arrangements with the trade unions on staff costs and the Shannon Airport Authority on airport charges.^[36] However at the end of June 2009 the company had accumulated losses of €93 million euro and Chairman Colm Barrington confirmed this situation could not continue.^[37] In October 2009, newly appointed Chief Executive Christoph Mueller announced a radical cost cutting plan that would lead to the loss of 676 jobs at the company and see pay and pension reductions for those being retained. The total plan aimed to achieve savings of €97 million euro between then and 2011. As a 6-week consultation process began, Mueller refused to rule out further cuts in the future.^[38]

Second Ryanair takeover bid (2008/2009)

On 1 December 2008, Ryanair launched a second takeover bid of Aer Lingus, making an all-cash offer of €748 million (£619mil; US$950mil). The offer was a 28% premium on the value of Aer Lingus stock during the preceding 30 days. Ryanair said, "Aer Lingus, as a small, stand alone, regional airline has been marginalised and bypassed as most other EU flag carriers consolidate." The two airlines would operate separately and Ryanair claimed that it would double the Aer Lingus short-haul fleet from 33 to 66 and create 1,000 new jobs.^[39][40][41] The Aer Lingus Board rejected the offer and advised its shareholders to take no action.^[42] The offer was eventually rejected by a majority of the other shareholders. It pwas the second failed attempt by Michael O'Leary to take over the national flag carrier. Ryanair initially left the offer open to Aer Lingus until it withdrew the bid on 30 January 2009. The Irish Government slammed O'Leary's offer as "undervaluing the airline" and stated that a Ryanair takeover would have a "significant negative impact" on competition in the industry and on the Irish consumer.^[43] Ryanair repeatedly stated that another bid was unlikely,^[44] but it kept a stake in Aer Lingus, prompting an investigation by competition regulators in the UK.^[45]

In June 2009 Aer Lingus re-branded its Premier Class to the new Business Class.

Gatwick base

On 19 December 2008, Aer Lingus announced that it would open a base at Gatwick Airport. Four aircraft were based there beginning April 2009, serving eight destinations that included Dublin, Faro, Knock, Málaga, Munich, Nice, Vienna and Zürich. CEO Dermot Mannion also said the company expects to increase the number of aircraft based at Gatwick to eight within 12 months.^[46]

As of 6 June 2009, the airline based an additional A320 aircraft at Gatwick, bringing the total number to five and making Gatwick its biggest base outside Ireland. This resulted in six new routes to Bucharest, Eindhoven, Lanzarote, Tenerife, Vilnius and Warsaw which commenced in late October 2009. The Gatwick to Nice route was suspended for the winter months.

On 8 January 2010, due to the weak demand in air travel, Aer Lingus announced that it was to reduce the number of aircraft based at Gatwick from five to three. The three remaining aircraft were to operate the carrier's services to Dublin, Knock and Málaga as well as a new route to Cork.^[47]

In January 2011, Aer Lingus announced a new daily service from Gatwick to Shannon starting at the end of March. The service has since been suspended.^[48]

The service to Málaga was suspended in January 2012, the airline now bases a sole aircraft at Gatwick servicing scheduled routes to Cork, Dublin and Knock as well as charter programme flights.

The Gatwick to Cork route ended 27 October 2012. A new service from Gatwick to Belfast City Airport started on 28 October, operating three times per day, and follows the airline's move from Belfast-International Airport to Belfast City Airport. That service was suspended on the 27 April 2016. Aer Lingus offers seasonal charter flights to Geneva and Lyon from Gatwick.

Appointment of Christoph Mueller as CEO

On 6 April 2009, CEO Dermot Mannion announced his resignation from the airline after four years as Chief Executive.^[49] He was replaced by German-born Christoph Müller (alternative spelling "Mueller"), former head of TUI Travel and Sabena, who joined Aer Lingus on 1 October 2009.^[50]

On 2 December 2009, Aer Lingus announced that talks with its unions had broken down. As a result, the board voted to reduce capacity, and with it associated jobs, as a response. According to Mueller, concessions offered by unions were of a short-term nature, and the airline was asked for high compensation in return. Aer Lingus did not identified the routes or jobs to be cut, but they would most likely "commence immediately and will be compulsory," according to Mueller.^[51] As of April 2010 all employees' groups had passed votes on the acceptance of the 'Greenfield' cost cutting plans which were expected to save €57M annually. Once implemented the second phase of cost cutting was to commence which aimed to save €40M annually by reducing 'back office staff' numbers by up to 40% according to the CEO.

Mueller indicated that Aer Lingus intended to reposition itself again, moving away from a head-to-head competition with Ryanair in the low-cost sector to a more hybrid model with a stronger emphasis on service. As part of this move, Aer Lingus entered talks to join an airline alliance again, having left Oneworld in 2007.^[52]

Aer Lingus announced on 15 June 2010 that it would suspend services from Shannon to Boston and New York (JFK) for 11 weeks beginning January 2011.^[53]

75th anniversary

Aer Lingus celebrated its 75th anniversary in 2011. On 26 March, the company presented its latest aircraft which has been painted in the 1960s livery and the crew was wearing a selection of historical uniforms.^[54]

Third Ryanair takeover bid (2012)

On 19 June 2012, Ryanair announced its intention to launch another bid to take over Aer Lingus, at €1.30 per share, for a total of €694 million.^[55] Ryanair expressed the hope that the competition authorities would not block this attempt, pointing to the recent takeovers of bmi and Brussels Airlines by International Airlines Group (IAG) (parent company of Iberia and British Airways) and Lufthansa, respectively.^[56]
On 20 June 2012, Aer Lingus issued a press release stating that, having reviewed Ryanair's proposed offer, the company board rejected it and advised the company's shareholders not to take any action in relation to it. The statement pointed out that any offer from Ryanair was unlikely to be capable of completion due to, firstly, the EU Commission's 2007 decision to block the airline's bid for Aer Lingus at the time, and, secondly, the UK Competition Commission's ongoing investigation of Ryanair's minority stake in Aer Lingus. Furthermore, the press release stated that the Aer Lingus board believed that Ryanair's offer undervalued Aer Lingus, considering the airline's profitability and balance sheet, including cash reserves in excess of €1 billion (as of 31 March 2012).^[57]

Virgin Atlantic wet lease agreement

In December 2012, following the acquisition of British Midland International by British Airways, Virgin Atlantic was awarded slots to fly domestic routes in the UK from Heathrow Airport, ending the monopoly on these services that BA had held since its successful takeover. Aer Lingus supplied on a wet lease agreement four Airbus A320-214 aircraft (painted in Virgin's colours but under Irish registration^[22]) as well as crew for these services, which operated from London Heathrow to Aberdeen, Edinburgh and Manchester. Services began on 31 March 2013 to Manchester.^[58] This wet lease agreement ended in September 2015, as Virgin Atlantic cancelled its domestic services.^[59]

Long-haul expansion

In July 2013 expansion into North America was announced launching in 2014; including a direct service from Dublin to San Francisco five times weekly and a daily service from Dublin to Toronto to be operated by Air Contractors with Boeing 757s on behalf of the airline. It was also announced that transatlantic services from Shannon to Boston and New York would operate daily all year round from January 2014 to Boston and from March 2014 to New York's John F. Kennedy International Airport; however, the airline would lease Boeing 757 aircraft from Air Contractors to operate these routes, rather than using its Airbus A330 aircraft as it had done before.^[60] Also, the service to Washington Dulles airport resumed 1 May 2015, with four flights weekly.^[61]

Change of CEO

On 18 July 2014, Aer Lingus said it had "been agreed" between the company and Mueller that he would step down as CEO and director in May 2015. Mueller left to join Malaysia Airlines as part of its restructuring exercise.^[50] On 16 February 2015 the company announced that the new CEO and director would be Stephen Kavanagh, beginning 1 March 2015.^[62]

IAG takeover (2014/2015)

On 14 December 2014, International Airlines Group (IAG) (owner of British Airways, Iberia and Vueling) launched a €1bn takeover-bid (€2.30 per-share) for Aer Lingus Group plc. The Aer Lingus Board rejected the offer on 16 December 2014, with Aer Lingus commenting that the offer was, "preliminary, highly conditional and non-binding." It was further noted, "The board has reviewed the proposal and believes that it fundamentally undervalues Aer Lingus and its attractive prospects. Accordingly, the proposal was rejected..."^[63]

On 9 January 2015, Aer Lingus rejected a second-bid from IAG, proposing a €2.40 per-share takeover.^[64]

On 24 January 2015, IAG launched a third bid for Aer Lingus, proposing a €2.55 per-share takeover offer, totalling close to €1.4bn.^[65]

On 27 January 2015, Aer Lingus' Board announced that, "the financial terms of IAG's third proposal for the airline are at a level it is willing to recommend..", Aer Lingus said it noted, "IAG's intentions regarding the future of the company, in particular that Aer Lingus would operate as a separate business with its own brand, management and operations."^[66]

On 26 May 2015, the Irish government agreed to the sale of its 25% shareholding to IAG, with a takeover now dependent on Ryanair's position on the matter.^[8]

On 10 July 2015, Ryanair voted to sell its nearly 30% stake in the airline. The takeover was later approved by the EU and US regulators subject to IAG giving up five slot pairs at London Gatwick Airport.^[67] On 2 September 2015, IAG assumed control of Aer Lingus.^[11] On 17 September 2015, following completion of the acquisition by IAG, the company's shares were withdrawn from the Irish Stock Exchange and the London Stock Exchange.

Corporate affairs

Ownership and structure

Aer Lingus was listed on the Irish and London Stock Exchanges, under ticker EIL1 on the Irish Stock Exchange and ticker AERL on the London Stock Exchange.^[68] However it was delisted on 17 September 2015 following its majority acquisition by IAG. Shareholdings (as of 2 September 2015) are:^[11]

Shareholder	Shares	Interest
International Airlines Group		98.05%
Other investors		1.95%
Total	534,040,090	100.00%

Aer Lingus Cargo

Aer Lingus Cargo is the airline's cargo division. It uses reserved areas of passenger aircraft cargo-holds. Aer Lingus Cargo is available on all routes to US from Dublin and Shannon. Cargo services are also offered on most European routes and some routes to the UK.^[69]

Aer Lingus Regional

Aer Lingus has a franchise agreement with Irish regional airline Stobart Air (formerly Aer Arann) under which Stobart Air operates a number of routes under the Aer Lingus Regional brand, livery and flight code.^[70] Stobart Air has not operated any flights under its own RE code since April 2012, and all its former routes have been transferred to Aer Lingus with flight numbers in the EI3XXX range.

Business trends

Following its acquisition by IAG on 18 August 2015, separate Annual Reports are no longer published for Aer Lingus, however some data are shown separately within the IAG Annual Report; key available trends for Aer Lingus over recent years are shown below (as at year ending 31 December):

	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015
Turnover (€m)	1,115	1,284	1,357	1,205	1,215	1,288	1,393	1,425	1,557	1,718
Operating profit (after exceptional items) (€m)							-	43.8	−108.4	130.4
Profit before tax (€m)	−79.4	124.8	−95.9	−154.8	−31.0	37.2	40.4	39.6	−111.5	135.2
Net profit (€m)	−69.9	105.3	−107.8	−130.1	43.0	71.2	33.9	34.1	−95.8	117.9
Number of employees (average FTE)						3,491	3,566	3,615	3,766	-
Number of passengers (m)	8.6	9.3	10.0	10.4	9.3	9.5	9.7	9.6	9.8	10.1
Passenger load factor (%)	77.6	75.4	72.8	74.5	76.1	75.6	77.7	78.4	79.0	81.6
Number of aircraft (at year end)						43	44	47	50	46
Sources						[71]	[72][73] [74][75]	[76]	[77]	[78]

Head office

The Aer Lingus head office is located on the grounds of Dublin Airport in Fingal, County Dublin.^[79] Dublin Airport Authority (DAA) renovated an existing building to create Aer Lingus's current headquarters.^[80]

The HOB Site,^[81] the 9.9-acre (4.0 ha) former head office site includes the former head office building, the services annexe, the Iolar House,^[82] the Mock-Up Building, the ALSAA swimming pool, and various smaller structures and buildings.^[81] The Head Office Building housed the corporate head office of Aer Lingus and its subsidiaries, and many administrative functions, employees, and car parking spaces, were located in this building. The Iolar House and Mock-Up Building housed training facilities for Aer Lingus crew and office space.^[81] This former head office is proximate to the former Ryanair head office. Brian Lavery of The New York Times said in 2004 that the proximity, described by Lavery as "a few parking lots away," was "a symbol of just how close the competition is to home."^[83] In 2010 Aer Lingus announced that it surrendered the lease on its current head office building to the Dublin Airport Authority, and that it would move its employees to Hangar 6 and other buildings in the airline's property portfolio during the year of 2011. The airline said that its current head office building, which was stated by the International Business Times to be in need of refurbishing, was too large for the company's needs following the "Greenfield" cost reduction programme.^[82] On 8 November 2011 Aer Lingus signed the contract with the Dublin Airport Authority for the surrender of the leasehold interest in the HOB Site. Aer Lingus would pay €22.15 million and interest to the DAA, with €10.55 million being paid over a ten-year period in annual payments, with each being equal size. The payments will involve a 5% interest rate per annum.^[81] The former HOB Site was redeveloped into Dublin Airport Central, with the Dublin Airport Authority planning to spend €10 million. The former head office became One, Dublin Airport Central.^[84]

Foreign offices

Aer Lingus operates its United States office in Jericho CDP and in the Town of Oyster Bay on Long Island, New York.^[85][86][87] The airline previously had its U.S. office in Midtown Manhattan, New York City.^[88] In 1997 Aer Lingus announced that it was moving its North American headquarters to Melville, Town of Huntington on Long Island.^[89]

Strategy

Aer Lingus adopted a "small frills" strategic approach – a hybrid between a traditional legacy airline and a low cost carrier.^[90] The difference lies in the services offered on short-haul and long-haul flights with meals offered free on the latter only. The new strategy required considerable negotiation with the unions and a consensus was reached that lower costs and a reinvention of the airline was necessary for its survival. The union concessions that arose from the negotiations were detrimental to the airline's image however; by 2003 the wage freeze had been lifted and there were 3800 voluntary redundancies with no forced layoffs. These factors contributed to the airline's reported profits in 2002, 2003 and 2005, with only a small loss recorded in 2004.^[90]

Employee relations

On 30 May 2014 Aer Lingus cabin crew staged a 24-hour strike resulting in the cancelation of around 200 flights and the disruption of travel plans by up to 200,000 people. The workers were seeking changes to their rosters, which the airline said that if implemented would mean the loss of 300 jobs in Ireland, which would have to be relocated to North America.^[91]

Social media

Aer Lingus has increasingly looked towards social channels to grow brand awareness. The company began Tweeting in May 2013 and has a presence on Facebook, Google+, Instagram, Linkedin, and Pinterest.^[92] The airline was the first to promote awareness of social media presence on the fuselage of an aircraft.^[93] The leased aircraft EI-FCC #socialjet with one side asking "Have you liked us yet?" and the other "Have you followed us yet?".^[92][94]

IRFU Sponsorship

On 30 April 2015 it was announced that Aer Lingus would become the Official Airline of the Irish Rugby Team. On the same day it was announced that one aircraft was to be renamed "Green Spirit" and wear a special livery for the Irish Rugby Team. Another aircraft would also be painted in the same livery.^[95]

Destinations

Codeshare agreements

Aer Lingus has codeshare agreements with the following airlines:^[96]

Fleet

Current

As of 31 July 2017, the Aer Lingus fleet is composed of the following aircraft:^[97]

Aer Lingus fleet

Aircraft	In service	Orders[98]	Passengers[99]			Notes
			J	Y	Total
Airbus A320-200	34	—	—	174	174	Two in Irish Rugby Livery & One in Retro Livery
Airbus A321-200	3	—	—	212	212
Airbus A321LR	—	7	TBA			Three due in 2019, Four due in 2020[100]
Airbus A330-200	4	—	23	243	266
				248	271
Airbus A330-300	7	1	30	287	317	Due in 2017[101]
Airbus A350-900	—	9	TBA			Three deliveries per year from 2018—2020[102]
Total	48	17

In February 2012, Aer Lingus' Chief Commercial Officer announced that the carrier was "very keen to see" whether the Airbus A321neo or Boeing 737 MAX would have a "transatlantic capability" to serve the USA's East Coast as part of a wider short-haul fleet renewal programme. The carrier could order "up to five" narrow-bodies for North Atlantic routes.^[103][104] In a March 2014 interview with Anna.aero, Stephen Kavanagh reiterated the company's interest in either an Airbus or Boeing replacement order of up to 40 aircraft.^[105]

In February 2014, Aer Lingus commenced a damp-lease of three Boeing 757 aircraft from Air Contractors (Now ASL Airlines Ireland), operating long-haul routes from Shannon to Boston and New York and from Dublin to Toronto. An additional 757 was leased in 2015 to allow expansion for the new Washington Dulles and Hartford, Connecticut routes.^[106]

In February 2015, Aer Lingus announced that its Airbus A350 aircraft (A350 XWB or regional variant) will begin delivery in 2018, with three aircraft being delivered per year through to 2020. These nine aircraft will replace its current A330 aircraft.^[102]

In January 2017, Aer Lingus announced its intention to finalise an order for seven A321LR twinjets to develop thinner transatlantic routes which cannot be operated profitably using A330s. The aircraft will also be used to replace the four 757s on lease from ASL Airlines Ireland^[107]

Fleet history

Transatlantic fleet

• Boeing 707–320 1964–1986
• Boeing 720 1960–1971
• Boeing 747-100 1971–1995
• Boeing 767-300ER 1991–1994
• Lockheed L-749 Constellation 1948 (Aerlínte Éireann)
• Lockheed L-1049 Super Constellation 1958–1960

European and commuter fleet

• Airbus A319-100 2011-2016
• Airspeed Consul 1948–1950
• Aviation Traders Carvair 1963–1968
• BAC One-Eleven 1965–1990
• BAe 146–300 1995–2006
• Boeing 737-200 1969–1992
• Boeing 737-300 1987–1993
• Boeing 737-400 1989–2005
• Boeing 737-500 1990–2005
• Bristol 170 Freighter 1952–
• de Havilland DH.84 Dragon 1936–1938
• de Havilland DH.86 Express 1936–1946
• de Havilland DH.89 Dragon Rapide 1938–1940
• Douglas DC-3 1940–1964
• Fokker F27 1958–1966
• Fokker 50 1989–2001
• Lockheed Super Electra 1939–1940
• Saab 340 1991–1995
• Short 330 1983
• Short 360 1984–1991
• Vickers Viking 1947
• Vickers Viscount 700 1954–1960
• Vickers Viscount 800 1957–1973

Services

Routes, aircraft and class services:
Route	Aircraft	Economy Class	Business Class
Europe, North Africa & Asia Minor	All A320, A321, A330 (on seasonal, select routes)	29"-30" seat pitch. Buy on board: food and drinks available for purchase on board. No in-flight entertainment.	Aer Lingus does not have a Business Class cabin on short haul routes. However, in late 2015 it was announced that a new service featuring new short haul business offering branded "Aer Space" will launch in 2016 and will include middle seat left free, priority boarding, baggage delivery and hand baggage being stored on board. Lounge access, complimentary food and full ticket flexibility is also included.[108]
North America & Europe	A330, 757	32" seat pitch. Free meals and non-alcoholic drinks. Individual TV Screens with Video on demand KidZone – An area for younger passengers with Disney movies, TV shows, music and games. Universal power ports. "Fly Connected" — WiFi for payment.	Flat bed Free meals and drinks. Individual TV Screens with Video on demand. Universal power ports. Available on selected European services for an extra fee "Fly Connected" — Free WiFi in Business Class.

The airline previously offered buy on board products from Tayto which were popular with customers.^[109] Northern Tayto products were available on flights to and from Northern Ireland.^[110] They began selling them in 2015 but discontinued the product in 2016.^[111]

Frequent Flyer programme

AerClub is Aer Lingus' Frequent Flyer Programme. AerClub consists of four tiers: the entry-level Green, Silver, Platinum, and Concierge.^[112] AerClub uses Avios points as its member currency. AerClub launched in November 2016, taking over from the airline's previous programme, Gold Circle.

Incidents and accidents

Aer Lingus has had 12 incidents, including six accidents which left aircraft written-off (of which three were fatal) and one hijacking.

• On 10 January 1952, a Douglas DC-3 (actually a civilianised ex-military Dakota) registered EI-AFL and named "St. Kevin" was en route from Northolt to Dublin. It flew into a mountain wave triggered by Snowdon and an area of extreme turbulence, then crashed in a peat bog near Llyn Gwynant in Snowdonia, killing all 20 passengers and 3 crew. It was the company's first fatal accident.^[113]
• On 1 January 1953, a Douglas DC-3 registered EI-ACF and named "St Kieran" made a forced landing near the town of Spernall, England. Both engines quit after the running out of fuel while on route from Dublin to Birmingham. All of the 25 passengers and crew survived. The aircraft was later written off.^[114]
• On 22 June 1967, a Vickers Viscount registered EI-AOF on a pilot-training flight stalled and spun into the ground near Ashbourne, killing all three crew.^[115]
• On 21 September 1967, Vickers Viscount EI-AKK flying from Dublin to Bristol scraped its wing on the runway and crashed on landing at the destination airport. All of the passengers and crew survived. The aircraft was later written off.^[116]
• On 24 March 1968, a Viscount EI-AOM "St. Phelim" en route from Cork to London crashed near Tuskar Rock in the waters off the southeast coast of Ireland. All 57 passengers and 4 crew perished. The crash is generally known as the Tuskar Rock Air Disaster in Ireland. Part of the aircraft's elevator spring tab was found some distance from the rest of the wreckage, suggesting that it had become detached at an earlier stage. However, the accident report reached no definitive conclusion about the cause of the crash, but did not exclude the possibility that another aircraft or airborne object was involved. Following persistent rumours that the aircraft's demise was linked with nearby British military exercises, a review of the case files by the Air Accident Investigation Unit took place in 1998. This review identified a number of maintenance and record-keeping failures and concluded that the original report failed to adequately examine alternative hypotheses not involving other aircraft.^[117] A subsequent investigation^[118] concluded that the accident happened following a structural failure of the port tailplane, and ruled out the possibility that another aircraft was involved.
• On 2 May 1981, Aer Lingus Flight 164 from Dublin to London was hijacked and diverted to Le Touquet - Côte d'Opale Airport in France. While authorities negotiated with the hijacker by radio in the cockpit, French special forces entered the rear of the aircraft and overpowered him. None of the passengers or crew were injured during the hijacking. The official record shows the reason as One hijacker demanded to be taken to Iran. Plane stormed/hijacker arrested. Duration of the hijacking: less than 1 day.^[119] while various media reports indicated that the man, Laurence Downey (a former Trappist monk), demanded that the Pope release the third secret of Fátima.^[120][121]
• On 31 January 1986, Aer Lingus Flight 328 a Short 360 registration EI-BEM on a flight from Dublin to East Midlands Airport struck power lines and crashed short of the runway. There were no fatalities but two passengers were injured in the accident.^[122]
• On 26 May 2017 a Stobart Air ATR 72 on behalf of Aer Lingus just completed flight EI-3727 from Manchester, England to Cork, Ireland, when a female passenger was disembarking and fell down the stairs, receiving serious injuries. Passengers were kept on the plane for 70 minutes until the victim was taken to hospital.

See also

• Transport in Ireland

References

External links

Media related to Aer Lingus at Wikimedia Commons

• Official website