ABSTRACT
In the wake of deregulation of air travel in Europe, an examination of how Ryanair and Aer Lingus have responded to this external stimulus has revealed significant differences of importance to strategists. Information was collected from published sources and through interviews with senior management of the two airlines. The niche market and seamless service of Aer Lingus, the established airline, has exposed this provider to the full might of international competition and has resulted in higher costs and lower financial returns. In contrast, the no-frills approach of Ryanair, a recent entrant, has allowed low prices to be supported and helped to draw new passengers on routes hitherto restricted to other forms of transport. An assessment of the outcomes of these contrasting responses highlights the need for managers to question the suitability of theory and received wisdom to guide action.
