Ryanair needs to stick with Boeing despite recent troubles maintaining its ultra-low-cost aircraft, an aviation analyst has revealed.

The airline’s chief executive, Michael O’ Leary, said last month he was “extremely disappointed” that the Irish budget carrier would only receive what Boeing ordered in time for its summer flight schedule. 40 out of 57 aircraft.

This means the airline will have to reduce flight frequencies on some existing routes this summer, its peak time of year.

Ryanair said the changes would reduce its passenger numbers in the 2024-25 financial year from 205 million to 198-200 million, a net increase on the previous year but below its expectations.

Still, Mr O’Leary, who is known for his outspoken approach, has chosen to support Boeing despite delivery delays and a host of issues related to its aircraft, saying: “As Ryanair navigates these temporary challenges, Boeing The company will continue to have the full support of Ryanair.”

FILE PHOTO: Ryanair CEO Michael O'Leary speaks during a news conference on Ryanair's multi-billion dollar purchase at Boeing headquarters in Arlington, Virginia, U.S., May 9, 2023 Deals for up to 300 Boeing planes were announced. REUTERS/Evelyn Hockstein/File photo
Ryanair chief executive Michael O’Leary has backed Boeing in recent statements (Photo: Evelyn Hockstein/Reuters)

Bernard Lavelle, chief aviation consultant at BL Aviation Consulting, said he expected Ryanair to remain loyal to Boeing rather than switch to Airbus because it meant the airline could maintain its low-cost model.

He said I: “I suspect Michael O’Leary probably thought now would be the best time to provide support because that’s how they deliver the aircraft.

“They’re all about Boeing and that’s part of their ultra-low-cost model.

“Moving to a different supplier would cause them to abandon that model.

“I think that’s why they’re very, very unlikely to go to Airbus.”

See also  Dubai ground flights hit by record flooding; airport works to resume full operations

Mr Lavelle said sticking with a single aircraft supplier would mean pilots would only need to be trained to fly Boeing planes, and the new supplier would require more training.

Additionally, airlines must maintain a certain level of spare parts for their aircraft at any given time. It’s cheaper to maintain just one brand of aircraft.

John Strickland, aviation analyst and director at JLS Consulting, agreed that Ryanair did not want to abandon its relationship with Boeing despite the delivery delays.

He said I: “Ryanair will certainly seek compensation, but that does not mean they will seek to end their relationship with Boeing.

“A large Boeing fleet is integral to its growth strategy.”

FILE PHOTO: A Boeing 737 Max aircraft is on display at the Farnborough International Air Show in England on July 20, 2022.Reuters/Peter Cziborra/File Photo
Ryanair said last month it expected to receive only 40 of the 57 Boeing aircraft it had ordered by the end of June this year (Photo: Peter Cziborra/Reuters)

Despite Ryanair’s loyalty to Boeing, Mr Lavelle believes Mr O’Leary is likely to agree to Boeing paying the fine to cover any losses the airline may suffer.

“There will be some kind of penalty associated with late delivery in the contract,” he said. “Michael O’Leary will ensure that liquidated damages are included in the contract.”

There may be a break clause in the contract, but he noted that such a clause suggests they have other places to go.

“The problem here is there are only two suppliers in the market,” Mr. Lavelle said. “That’s not ideal, but it is what it is.”

Airbus is the only other supplier of single-aisle aircraft used by Ryanair.

“This will be a huge move for Ryanair and Airbus because they have a huge backlog and therefore can’t deliver what they need. [of orders].

See also  ‘It’s not enough’: Hartlepool voters and Tories uninterested in budget

“There will be a review clause between Ryanair and Boeing where they will review issues such as delivery delays and quality. What Ryanair wants is a high-quality aircraft delivered on time.”

He said Boeing hopes to retain such a large customer. “Boeing’s problem becomes Ryanair’s problem,” he said. “They have to work together to solve this problem.”

Ultimately, he believes the plane maker can do it. “Boeing does a lot of military work for the United States and they are too big to fail,” he said. “They’re going to solve their problems.”

This relationship has already yielded some results. Mr O’Leary announced on Wednesday that Boeing had taken steps to speed up deliveries of backlogged aircraft and that two or three more aircraft could be delivered by the end of June.

“If they get three planes early, that means other airlines are now delayed getting three planes,” Mr Lavelle said.

He said Ryanair’s strategy now was to “obtain funds by paying fines” and “continue to put pressure on Boeing to buy aircraft”.

“He will be keeping a close eye on the new management at Boeing so that they can supply them with more aircraft,” he said. “I don’t think he’s made any significant changes.”

He added: “All Michael O’Leary cares about is the delivery of his aircraft and he will only keep up the pressure.

“He might be right in saying we’ll take the fine and let this summer play out, but he won’t be that happy if it happens again next year.”

Ryanair and Boeing have partnered with I for comment.

See also  FM Budget Wear Blue Tussar Saree This Year Nirmala Sitharaman Budget 2024

Due to aircraft shortages and continued high demand, ticket prices may rise, but not necessarily enough to cover financial losses. Ryanair said last month that Boeing’s delivery delays would result in “more constrained capacity and slightly higher ticket prices” this summer.

Boeing’s planes are facing a series of problems. In January, an in-flight cabin explosion on an Alaska Airlines plane led the US Federal Aviation Administration (FAA), the European Union Aviation Safety Agency and the UK Civil Aviation Authority to ground the Boeing 737 Max 9. A security check was conducted.

Affected by the incident, the FAA conducted a six-week audit of Boeing and Spirit AeroSystems and found “multiple incidents in which the companies allegedly failed to comply with manufacturing quality control requirements,” leading the FAA to halt the Boeing 737 Production expansion for Max.

This means Boeing cannot meet delivery schedules for new aircraft orders from airlines such as Ryanair.

Follow us on Google news ,Twitter , and Join Whatsapp Group of thelocalreport.in