Aer Lingus yesterday cut its business class fares by up to 50 per cent in a move it claims will save Irish business an estimated €65 million per year. It also introduced cheaper economy airfares, with prices cut by up to 60 per cent, and has abolished ticket restrictions.

Economy fares now have no minimum-stay condition and customers will not be charged for itinerary and ticket changes, which had cost up to €100 previously.

Aer Lingus chief operations officer Mr Seamus Kearney said the reductions meant the cost of doing business was cheaper. He said the airline was "putting €65 million back into the hard-pressed Irish economy. Lower fares and lower costs are leading to higher passenger numbers and improved business performance," he said.

A company spokesman said the cut in business fares would save the corporate sector €65 million per year based on the amount spent by companies on business class seats last year. He said the costs of the discounting would, in part, be offset by cost savings at the airline. The Irish carrier has already finished its first tranche of savings of €190 million and has achieved around €60 million of its second tranche of €130 million in planned savings.

"We are also hoping that these cheaper fares will encourage businesses to travel more or to buy more business class seats rather than economy seats," the spokesman said.

Business class fares on the Dublin-Heathrow route have been cut by 28 per cent and start from €298. Economy fares on the same route have been reduced by 28 per cent to €150 and are "fully flexible". Dublin-Manchester business fares start at €228, 31 per cent cheaper than before, while economy fares have been reduced by 48 per cent and start at €130.