He said two things need to happen before the launch of such an airline: First the open skies deal recently signed between Europe and the U.S., set to increase competition on transatlantic routes, needs to come into effect. Second, O' Leary needs cheap aircraft.
"We're a couple of years away from this. It won't happen unless there's a cheap fleet," he said.
When there's a downturn in the airline industry, as was the case in the wake of the 9/11 terrorist attacks and the SARS Cheap Airfares epidemic, carriers sometimes decide to sell aircraft, often at steep discounts, to reduce capacity.
This is the opportunity O' Leary is looking for.
The rough plan would then be to operate flights from six to eight top European cities to the same number of top U.S. destinations. The aircraft would be divided between a low-cost cabin and an upscale business class that would seek to best that of Virgin Atlantic and British Airways.
"We can't get rid of business class on long-haul flights. The economics of it don't add up," he said.
At the back of the plane, economy flyers could snap up tickets for as little as 10 euros one-way.
Virgin Atlantic said on Monday that it Cheap Airfares plans to launch business-class only flights between Europe and the U.S. in the next 12 to 18 months. See full story.
O' Leary said that while he likely wouldn't run any new transatlantic airline on a day-to-day basis, he may invest in it to get it off the ground. He said he doesn't expect raising money for the project to be a problem.
He insisted, however, that the Cheap Airfares new airline would have nothing to do with Ryanair. It would be a separate entity run by a new management team.