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Last Updated: Monday, 10 May, 2004, 14:27 GMT 15:27 UK
Ryanair boss says prices to drop
Michael O'Leary
Mr O'Leary said competition was forcing down prices
The head of Ryanair has predicted that air fares will reach record lows this year.

Michael O'Leary said that competition between airlines was increasing and that was driving down prices.

However, speaking at the opening of a new 10m Ryanair hangar at Prestwick, Mr O'Leary forecast that not all companies would survive.

He said the facility would help bring more flights to Prestwick and he would announce new routes later this year.

The hangar will be used for aircraft maintenance, repair and overhaul and will be large enough to accommodate three of the Ryanair Boeing 737 aircraft.

Expansion concerns

About 200 jobs will be created, providing work for engineers, technicians, mechanics, apprentices and others over the next five years.

The project has been funded jointly by Ryanair, the Scottish Executive, Scottish Enterprise Ayrshire and Scottish Development International.

Mr O'Leary said: "Ryanair's 10-year history in Scotland and on-going commitment to the further growth and development of Glasgow Prestwick International Airport is further demonstrated with the opening of this new maintenance facility and the creation of close to 200 jobs for the local economy."

Ryanair aircraft on the tarmac
The airline is unhappy over its rates bill
But he warned Ryanair would halt all further job creation at the facility until a row over "ridiculous rates" was settled.

The airline boss said a rates bill of 110,000 from South Ayrshire Council had put future investment and job creation at risk.

He said: "The local council will tell us it's not their fault, it's the government's and the government will tell us it's not their fault, it's the local council.

"But somewhere in the middle is us and we need this thing sorted out or we are not going to continue to stimulate jobs and invest millions of pounds here if we are going to be met with bills for 110 grand."

Tom Cairns, chief executive of South Ayrshire Council, said: "The council has no discretion whatsoever in this matter."

A spokesman for the Scottish Executive said an appeal process was open to any business who wished to contest the rates and that Ryanair had done so and were now trying to reach an agreement with assessors.

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