Ryanair sees soaring inflation, Brexit-related challenges and a potential recession threatening the aviation industry’s recovery as a summer boom draws to a close.

While Europe’s biggest discount carrier is maintaining plans to boost winter capacity and continues to see strong growth, the resurgence is fragile and prone to external shocks that also include an escalation in the war in Ukraine, Group chief executive Michael O’Leary told reporters on Tuesday. “You’d be crazy not to be worried about the looming recession,” the Irish airline’s founder said in London. A downturn will surely take out some of the carrier’s competition, he added.

Ryanair is counting on its ability to take market share from rivals who continue to be hobbled by protracted staffing woes and caps at hubs such as London Heathrow. The group raised its full-year passenger target to 166.5 million last week, while adding new routes from the UK. The company plans to fly 225 million people a year by 2026.

Still, there is growing concern that rising living costs could dent demand into next year, O’Leary said, although the carrier expects to gain from customers trading down from full-service rivals. Another threat to Ryanair in particular is a further delays to deliveries of new planes by Boeing, he added.

British Airways will scrap about 5,000 round-trip flights this winter after cancelling 13 per cent of its schedule this summer due to a staffing shortage and extended curbs on capacity at its London Heathrow hub. – Bloomberg