In this post, I walk through my step-by-step understanding of the Harvard Business School case “Dogfight over Europe: Ryanair (A)”. I started with some confusion around the focus of the case and ended up learning quite a lot about how Ryanair’s early decisions fit into a larger context of airline liberalization in Europe.

✈️ What’s the Focus of the Paper?

The case begins with Ryanair announcing service on the Dublin–London route. At first, it felt confusing—why start with that, and how is it important?

Answer:
The case is centered on Ryanair’s strategic move to enter a protected, high-stakes route dominated by British Airways (BA) and Aer Lingus. It’s not just about one flight route—it’s a symbol of challenging the protected status quo in European aviation. It ties directly into the liberalization trend happening in the mid-1980s.

🤔 Why is Ryanair’s Move a Big Gamble?

If Ryanair offered lower prices with similar service, wasn’t that a sure win?

Answer:
No—because it lacked a cost advantage and was facing well-established giants. Here’s why it was risky:

  • Aer Lingus and BA could retaliate with price cuts.
  • Ryanair had higher cost per seat (no jet approval, smaller aircraft).
  • The market was not growing, so Ryanair had to steal share.
  • It risked operating at a loss, especially without scale.
  • Brand trust and visibility were weak.

🔄 How Does BA’s Liberalization Fit In?

BA was already profitable—how does that relate to Ryanair and EU liberalization?

Answer:
BA’s restructuring was not caused by liberalization, but rather in preparation for it. The U.S. airline industry had deregulated in 1978, and BA saw what could happen if they didn’t adapt. So BA:

  • Cut staff and routes
  • Improved service
  • Focused on business travelers
  • Prepared for privatization in 1987

BA’s transformation helped open the door for Ryanair’s entry by showing that flag carriers could survive competition. UK regulators also became more open, allowing new airlines like Ryanair to access London airports.

🇮🇪 What About Aer Lingus?

BA was getting reformed. But Aer Lingus seemed unchanged—how did that affect Ryanair’s access?

Answer:
Great point. Aer Lingus remained protected and state-owned. But:

  • Ireland had a relatively liberal bilateral agreement with the UK.
  • This allowed some competition, and Ryanair got approval from Irish regulators.
  • Possibly, public pressure and Tony Ryan’s influence played a role.

So Ryanair’s access to Dublin was an exception, not the norm.

🧠 Summary: BA vs. Aer Lingus

📉 BA Was Already Profitable—Did They Expect More?

Answer:
BA restructured not because liberalization would make them richer, but because not changing would kill their profits. They saw the U.S. experience and wanted to survive when the market opened up.

📌 If BA Stayed Protected, Could It Compete Globally?

Answer:
No. BA could dominate UK domestic routes, but without reform, it would be inefficient, expensive, and unable to compete in global markets. Liberalization gave BA the ability to become a truly international airline.

📊 Why Were U.S. Airlines More Efficient Than EU Airlines?

Answer:
Because of competition. U.S. deregulation forced airlines to:

  • Cut costs
  • Innovate with hub-and-spoke models
  • Operate with fewer employees per aircraft

In contrast, European protectionism kept airlines bloated:

Final Thoughts

This case is more than just Ryanair’s pricing decision—it’s about how one small airline tested a crumbling system, and how larger political and economic shifts (like privatization and deregulation) shaped the future of European aviation.

If you’re interested in how regulation, competition, and strategy collide, this case is a perfect example.

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