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Once again, changing what passengers do: I'll price luggage out of the hold, says Ryanair chief Michael O'Leary

He wants to halve number of passengers checking in bags and says making passengers pay for cabin baggage is also a possibility

Checking in a bag on Ryanair - which this summer costs anything from £25 to £160 for a one-way flight - could soar still higher, the airline's chief executive has warned.

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Michael O'Leary said he wants to halve the number of passengers checking in a bag from the present 20 per cent. Eliminating checked-in bags cuts the fuel burn, reduces handling costs and speeds up turnarounds - essential to the low-cost business model. But the controversial Ryanair boss conceded: "We will never get rid of (hold) bags".

Mr O'Leary said making passengers pay to take baggage into the cabin is also a possibility: "At some point in the future I think it's likely that airlines will do it". At present the Eastern European budget carrier, Wizz Air, charges for anything bigger than a laptop bag, as does Spirit Airlines of the US.

The prospect of ever-higher fees for baggage demonstrates Mr O'Leary is still determined to modify behaviour to cut costs. He ordered the abolition of check-in counters to save on staff wages and airport leases. Every passenger is obliged to print their own boarding pass, or face a £70 penalty. Arriving one minute beyond the 40-minute check-in deadline triggers a £110 "missed departure fee" for the right to board the next flight.

Behaviour modification goes beyond the cabin, as the revelation that pilots have been instructed to fly slower to reduce the fuel burn. Updated "standard operating procedures" require flight crews to adhere to specified limits during take-off, landing and the cruise.

"We're very keen to find ways to ensure our pilots are flying in the most fuel efficient and safe fashion," said Mr O'Leary. "All we're doing is trying to fly two minutes slower per flight." He told The Independent that the exercise was analogous to saving fuel while driving: "The best advice is to slow down, keep the windows closed and turn off the air conditioning". He said the new protocols could save £80m a year - equating to £1 per passenger.

The fact that fuel now amounts to almost half the airline's costs is indicative of the prevailing high price of oil, around $110 per barrel. But it also reveals how ruthlessly other costs have been cut at the airline.

While other carriers pay cabin crew trainees from day one, Ryanair outsources training and candidates are obliged to pay for their instruction. A typical course costs £2,500. They must also pay £360 for their uniform.

Michael O'Leary also saves on the cost of operating social media: "We don't have a Facebook page and we don't have Twitter," he said yesterday.

Ryanair has often incurred the wrath of competition authorities because of its policy of seeking marketing support" from airports keen to appear on the international flight map. Some destinations have paid upwards of £5 for every passenger landed. The airline also sells advertising on anything from the boarding pass ("providing repeat exposure for advertisers") to the entire aircraft exterior.

At the root of Ryanair's success, though, is the policy established early in 2001: buying planes in bulk at a time when no-one else is. One hundred and fifty of Ryanair's current Boeing 737 jets were ordered four months after 9/11, at an estimated 50 per cent saving on the $9bn list price. As a result, Ryanair's aircraft ownership costs are significantly lower than its rivals.

Some passengers bitterly resent Ryanair's policies. Earlier this year, Melinda Stevens, the editor of Condé Nast Traveller, called the airline "Bastards". After failing to book baggage in advance, she wrote: "Engaging with Ryanair is dabbling in the devil's work, or at least turning up at the devil's door, ringing his bell and throwing your money at him while asking him to repeatedly jab you in the solar plexus with a jagged instrument".

Ryanair is moving its attention eastwards in seeking new opportunities, with Israel and Russia seen as likely prospect. Russia's leading airline, Aeroflot, is planning a low-cost subsidiary. Mr O'Leary refused to comment on rumours that it may be called RyanAeroflot, but said: "It'll be as unsuccessful as every other high-cost airline that tries to set up a low-cost airline".

Any other savings on the horizon? "As soon as we can think of one, we'll be implementing it," he told The Independent.