Irish air carrier Ryanair announced this week that it is teaming up with the new Austrian airline LaudaMotion to offer low-cost airfares to travelers flying within Europe. LaudaMotion is an upstart budget airline founded by former Formula One driver Niki Lauda.
The new airline will be based out of Vienna and will serve much of Europe. Ryanair will initially offer a 24.9% stake in the LaudaMotion. Upon approval by the European Union regulatory officials, this stake could rise to as much as 75% of the company.
This move is meant to increase competition in the market space currently dominated by European and international airline giant Lufthansa. LaudaMotion will offer flights from originating points in Germany, Switzerland, and Austria and will travel to popular short-haul vacation destinations. Germany flights will begin this week, with flights from Switzerland launching in April, and Austria beginning in June. Tickets are on sale already with a starting price point of 59 euros (approximately $74).
To promote growth, Ryanair has agreed to lease six of its Boeing 737s to LaudaMotion and an additional 30 more aircraft within the next three years. Ryanair has also committed to providing LaudaMotion with 50 million euros (approximately $61 million) in operational funding. Aviation experts predict that LaudaMotion will grow quickly now that it has access to Ryanair’s established financial resources and aircraft. The big winners in this partnership will be European travelers who will now be provided with greater travel options and lower fares.