Bangkok they found a relatively safe and friendly city. While the three-year-old Shane remained at home with his mother, Declan was sent to the English school in Bangkok, where, to his father’s evident pride, he continued to assert his Catholicism by getting suspended for refusing to sing the Anglican hymn ‘All Things Bright and Beautiful’.
Putting down these kinds of cultural markers was a strong feature of life in the international community. Much of the Ryans’ social life centred on the swimming-pool of the British Club in central Bangkok, where the boys got into fierce competition with the Brits, Aussies and Kiwis. In the first year Cathal, who swam for Clongowes, combined with two other Irish boys, the McManus brothers, to win the Gold Ribbon 4 × 100 m relay race at the annual swimming gala. ‘Tony loved that,’ Declan says. ‘He went all around Bangkok boasting that the Irish had won it with three men instead of four, and he was sending letters home saying the only time the Paddys could win is when we’re one man down.’
These were enjoyable times for the family; but, just as in the United States, life in Thailand was also taxing for Mairéad and the family. Being on different continents had been tough enough in the more familiar environment of New York. But in Bangkok it involved more sacrifices for everyone, not least the children. Cathal continued to make the long trip back to Clongowes at the beginning of each school term. After Declan turned twelve he joined his brother on the arduous journey. There were no direct flights, so the two brothers had to make their way to Karachi in Pakistan to catch a plane to London. Given that their father was in the airline business, they might have expected him to do a better job at making their arrangements. ‘I remember us getting offloaded at Karachi’, Declan recalls, ‘and ringing Tony in the airport at four in the morning, saying, “Would you ever just buy us a ticket some time?” I only had two quid in my pocket. Luckily, British Airways took care of us.’
For Tony himself, life in Bangkok was all about work. ‘He was in charge of everything,’ David Kennedy says, ‘including responsibility for collecting the rental money on the lease.’ To keep the whole operation together involved both dedication and not a little tact. To begin with, there were relations with Air Siam to consider. Tony effectually became no. 2 in the airline, working closely with Virachai Vannukul to make the Boeing 747 route as profitable as possible. But it was also his job to watch Air Siam for any sign of irregularity or financial distress—so he was both friend and informer.
Then there were the Aer Lingus workers to consider. Bangkok was a city with many pleasures on offer. He would tell the staff: enjoy the benefits, but remember that you are here not just as employees of the company but also as representatives of Ireland.
There were also the cultural differences to navigate between the Irish and Thai staff members. This latter aspect did cause some tensions within the Irish group, especially when it came to allowing Thai trainees into the cockpit. At a ‘clear the air’ meeting on the subject, one staff member asked whether it was really a good idea ‘to put these guys in the left-hand seat when they’re just down from the trees, for God’s sake.’ Tony’s response was quiet but brutal: ‘Okay, I will agree with that,’ he said, ‘if anyone here can tell me the difference between “down from the trees” and “up from the bogs”.’
Smoothing over cultural misunderstandings and sensitivities was also an important part of Tony’s job when dealing with the many VIPs touring Asia in the 1970s. One of the trickiest involved Jack Lynch, leader of Fianna Fáil, who visited in 1974. Even before Lynch arrived there had been panic in Bangkok when his plane went missing, leaving Tony on the ground wondering how he would explain to Dublin that he had lost a former Taoiseach. In fact Lynch’s plane, flying out from Saigon, had made an unexpected stop in Cambodia, which was in the middle of a bloody civil war. The Vietnamese ambassador to Cambodia was also on board and needed to be dropped off. Flying into Phnom Penh Airport, which was constantly under mortar attack by the Khmer Rouge, was a risky business. Lynch’s flight got in all right, but then he had to remain on the plane with no air conditioning or toilets for more than six hours. No wonder that by the time the flight arrived in Bangkok, Lynch was extremely ill.
Tony was waiting with a limousine for Lynch and the former Minister for Justice, Des O’Malley. The journey into Bangkok, on crowded, damaged roads in the monsoon season, was almost as stressful as the plane journey. Lynch, sweating profusely, slept in the back while Tony and O’Malley began chatting. The two would later become close, with O’Malley even acting as solicitor for Tony when he bought Kilboy House in Co. Tipperary a few years afterwards. Perhaps those friendly relations were rooted in the tricky exchanges that took place between them in Bangkok.
Tony asked where the two politicians were staying. When O’Malley told him, Tony turned white. ‘You can’t say there,’ he said.
‘It has been booked for us,’ O’Malley retorted, ‘so it must be all right.’
Tony stood firm. ‘I’m taking you to the Siam Intercontinental.’
When they arrived at the new hotel, O’Malley demanded an explanation, but Tony refused. Only much later did he get the story out of Tony that the other hotel had been involved in a sex scandal just a few weeks earlier.
‘That’s fine,’ O’Malley said, ‘but why couldn’t you just tell me?’
Tony was horrified. ‘You couldn’t be telling a thing like that to the former Taoiseach,’ he explained, ‘and sure he might be Taoiseach again!’ Tony’s mother, like Lynch from Cork, would have been proud.
Tony’s working life in Bangkok in many ways must have seemed a souped-up version of his time as station manager in JFK. He may not have been dealing with the day-to-day operational details of flights, but he was still working long hours, dealing with staff problems, operating within a foreign jurisdiction, smoothing the way for visiting dignitaries and taking orders from head office in Dublin. To all intents and purposes he continued to look like a solid company man.
Those who visited Tony in Bangkok during this period, however, noticed a dramatic change in his character. When Laurence Crowley went out to Thailand he was astonished by the transformation.
On one occasion the two men took a taxi, with Crowley picking up the tab. ‘How much did he charge you?’ Tony enquired. When Crowley told him, Tony was outraged that his colleague had been so egregiously overcharged. Tony ran in front of the car and, to Crowley’s horror, lay down in front of it until the driver repaid the difference in the fare.
Others too observed a man more entrepreneurial and selfconsciously aggressive. One colleague from Aer Lingus was amused to find Tony reading Winning through Intimidation, the New York Times best-seller by Robert J. Ringer that taught how ‘the game of business is played in a vicious jungle.’
Tony was also aware of the change. Later he would tell the story of becoming fixated by a street food vendor he saw on his way to work each day:
He was a banana-chip maker. His business was to slice, cook and sell banana chips to passers-by. He was extraordinarily skilful, not only in slicing hundreds of bananas into thousands of perfect pieces but also at selling his product. He impressed me and made me think. I felt it a pity that such marketing, technical talent and energy were devoted to a process which sold for a mere penny. There and then I determined that … I would apply my energies to developing and marketing a big-ticket product which could sell for vastly more.
Perhaps the most telling witness to the impact on Tony during his time in Bangkok was Mick O’Carroll. The two men had worked together when they started out at Shannon in the 1950s, and they had remained friends ever since. When O’Carroll stayed with the Ryans in Bangkok he was astonished by what he found. The craic between mates was as good as ever, but there was a new element that O’Carroll had never seen in Tony before. ‘He was no longer the laid-back, devil-may-care guy’, O’Carroll says, ‘but a driven businessman getting up at crazy times in the morning, up until all hours and talking about visions of leasing.’
At a relativel
y late age, heading towards his fortieth birthday, the entrepreneurial heartbeat had finally and, to those who knew him longest, unexpectedly started beating in the breast of Tony Ryan.
——
Tony’s first idea was to launch a business that specialised in aircraft leasing in the Third World through commodity swaps instead of money. ‘There are places where they have, let’s say, an over-supply of coconuts but they’ve got no money,’ he explained to Derek O’Brien, who was working with him running the Air Siam lease, ‘and there are other places where they’ve no coconuts but they have money, so why can’t we lease the planes as a commodity swap?’
When he tested the ground with potential customers, Tony soon found that they baulked at the idea of commodity-swapping their Jumbos, for example, for bicycles, and the concept was dropped. It was an illustration of how Tony was by now prepared to think outside conventional wisdom to get a business off the ground, even if, laughs Mick O’Carroll, ‘it was a daft idea.’
Tony’s next idea was more straightforward. He had already successfully leased out planes for Aer Lingus. Now he planned to establish a new company that would act as a broker for airlines around the world that needed to offload surplus aircraft.
On 1 May 1975 Tony became chief executive of a new aircraft-leasing company, Guinness Peat Aviation. He took a 10 per cent holding for a £5,000 investment—a large sum for an Aer Lingus manager, which he raised by remortgaging his house. He also negotiated a performance-based, profit-sharing agreement. The other shareholders, taking 45 per cent each, were Aer Lingus and Guinness Peat, a London investment firm in which the airline was a minority shareholder.
The circumstances of how GPA came into being were complicated. Tony would later claim that he thought up the concept for a leasing company on his own in Bangkok, where ‘the original idea was fermenting away’. However, when he returned to Dublin to pitch the idea to Aer Lingus the new chief executive, David Kennedy, poured cold water on it. But when he got a second meeting with Kennedy, Tony turned up with his lawyer—a trick taken straight out of Winning through Intimidation—and informed the company that he was resigning in order to set up his own leasing company in conjunction with an Asian airline and an American bank. Recognising that Aer Lingus was about to lose an opportunity, Kennedy caved in and offered Tony the chance to go into business with Aer Lingus. From that position of strength Tony was able to negotiate the ball-breaking contract that gave him profit-sharing and a 10 per cent shareholding that could not be diluted in the event of other investors coming on board. This deal would see his initial £5,000 investment transformed into multi-millions.
The internal company history that GPA later commissioned told a rather more benign story. This version has Tony returning to Dublin in order to resign and launch his own start-up in Asia. When he informed Kennedy the latter replied, ‘Why don’t you do it in Ireland?’
That ties in with Seán Braiden’s recollection. Aer Lingus had bought a minority shareholding in the Guinness Peat Group, with the idea of having a foothold in the City of London, making financing easier for any new business ideas. But, according to Braiden,
nothing much happened until Tony came along with the idea of a leasing company. So the view inside Aer Lingus was this was an entrepreneurial endeavour on our behalf which wasn’t going to cost an awful lot. If it blossomed, all the better; but if it didn’t, then the least it would do would be to solve Aer Lingus’s own leasing problems.
So Tony got the go-ahead, Braiden concludes, because he was ‘convincing’ and ‘put a very good story across’.
Kennedy remembers events differently. ‘The initial thrust for the establishment of GPA came from Aer Lingus,’ he says. The idea was part of an overall policy that Aer Lingus developed during a sharp downturn for the global airline industry to generate profits from activities that were ancillary to the company’s main business. That change of direction was approved by the Minister for Transport and Power, Brian Lenihan, Snr, and then confirmed by the new minister, Peter Barry, when the Government changed in 1973.
Aer Lingus wanted to use its own in-house skill base to convert cost centres in the airline into profit centres. Gerry Dempsey, the Aer Lingus representative on the Guinness Peat Group board, presented a list of eight areas of possible collaboration between the airline and the investment firm, including a travel agency, freight forwarding and foreign exchange. Of all the ideas, aircraft leasing stood out as the ‘number one’, most viable project.
‘So we decided,’ Kennedy says, ‘in collaboration with Guinness Peat, that we would set up an aircraft-leasing company bringing together the financial strength of the bank and the aviation expertise and credibility of Aer Lingus.’ It was only at this stage, he suggests, when the decision to go ahead had been made, that Dempsey ‘discussed with Tony the concept of his becoming chief executive of this new company.’
Even today the question of whether Aer Lingus received due recognition for the part it played in setting up GPA continues to rankle with Kennedy.
Tony said that he would have set up a leasing company himself anyway, and maybe he could have done so. But he would not have had the credibility of a City of London bank and a well-reputed airline behind him. It is a pity that in later years he allowed the myth to spread that Aer Lingus was a reluctant participant in the company. Nothing can be further from the truth.
On one level Tony was always happy to give Aer Lingus due credit. He understood that brokerage was the ‘raw edge of the industry’ and that it often conjured up images of ‘one man working out of a garage … striving to clinch the one good deal which might set him up for life.’ The involvement of Aer Lingus, a well-respected and Government-owned airline, neutered that problem. In fact, one of the early problems the new company ran into was that potential clients didn’t always appreciate that Guinness Peat Aviation was an Aer Lingus spin-off at all. The combination of an Irish address and the Guinness name seemed to speak more of pints of stout than of a serious aircraft-leasing business—and what supplies of peat had to do with things was anyone’s guess. No wonder the company quickly resorted to operating under the initials GPA—even though Tony himself always preferred the full title.
Tony never wavered in his stance that the original idea for an aircraft brokerage was his. He always maintained that his early soundings in Aer Lingus about the idea for a new company were peremptorily rejected. Soon he found himself frustrated to be in possession of ‘valuable market intelligence about someone who wanted a DC-9 and I could do nothing about it.’ That was the moment he put an ultimatum to Aer Lingus: back my idea or lose me.
Perhaps in the end it all came down to personality. David Kennedy in 1975 was already a star of the international aviation industry. Appointed chief executive of Ireland’s national airline at the age of just thirty-five, he had made it to the top of a business worth $100 million a year in only twelve years. No wonder that Time hailed him as the ‘whiz-kid’ of the airline corporate world.
But Kennedy, whose cool, considered business personality reflected his past as an Irish chess champion, was the head of a semi-state organisation. He was an innovator in his own way, but he was also a manager operating within an environment that demanded due process and order.
Tony Ryan was by now a different kind of animal. Aer Lingus had helped give birth to an entrepreneur. And, as Tony said of himself in 1975, ‘I was never going back to the womb.’
Chapter 4
START-UP
‘It was a hectic month with many, many inquiries and leads,’ wrote Tony Ryan in his first Guinness Peat Aviation report to the board in July 1975. ‘It does bring home forcibly that in this industry one must go down many “blind alleys”. I estimate that it may be necessary to follow up 50 leads before pinning down some business.’ It was a signal of just how difficult things would be for Tony and his fledgling leasing business.
The following month GPA formally began trading in Shannon Free Zone, the international business park next to Shan
non Airport in Co. Clare. There were certain obvious advantages to this decision, not least the highly favourable corporate taxation system that gave the new company tax-free status on its profits. There was also the strategic perk that the location, well over a hundred miles from Dublin, was away from the prying eyes of Aer Lingus senior management. Tony already had Aer Lingus placemen breathing down his neck in the chairman, Dick White, and company secretary, David Fleury. The last thing he needed in addition to this supervision was Aer Lingus senior management regularly dropping in on him unannounced to ‘see how things are getting along’. Physical distance from Dublin helped ensure autonomy for both Tony and GPA.
Beyond these obvious business advantages, there were other important personal considerations in this choice of location. By setting up in Shannon, Tony Ryan was returning home. When he first raised the issue of a Shannon licence with Laurence Crowley of Stokes Kennedy Crowley during a long flight back to Ireland from Thailand, Tony explained that his main reason for wanting to go to Shannon was ‘because my background is Tipperary’.
That mattered to Tony at a profound level. Over the coming years he would find himself on the road and in the sky travelling about half a million miles per annum. But he remained rooted in Ireland because at the end of every trip he came back to Tipperary and the south. Home for Tony always centred on the lines of the Great Southern Railway. His childhood had been spent in Limerick Junction and Thurles, with regular trips down to Mallow to stay with his mother’s family. Now he was returning to Shannon and would soon buy Kilboy House in north Co. Tipperary. These touchstones meant that, however far and often he travelled, Tony remained rooted in the terrain of his youth.
Tony Ryan Page 5
