What has big budget airline Ryanair ever done for us?

Things can only get worse: that was the outlook from the boardroom of a small Irish airline called Ryanair. Forty years ago this week, it launched flights between Waterford in southeast Ireland and London Gatwick.

- SIMON CALDER

The plane making the maiden journey on 8 July 1985 was a 15-seat Brazilian-made Bandeirante aircraft. Over the next few years, as the airline expanded its operations over the Irish Sea, the losses mounted. By 1989, investors were down £20m. A young accountant named Michael O’Leary had just joined Ryanair.

"We had a business class and a frequent flyer club and all the rest of it," he later told me. "But the fares were about 20 per cent cheaper [than BA and Aer Lingus], which meant we just lost more money than they did."

In a last-ditch effort to stave off closure, Mr O’Leary travelled to Love Field in Dallas, Texas: the home of Southwest, a young and thriving low-cost airline. The visionary in charge, Herb Kelleher, was happy to share in the secret of his success: not chasing after more established rivals, but cutting costs and fares to entice an entirely new market to take to the skies.

"What took real brains and real balls was to say, ‘We can charge $10 a seat and still make money.”