Ryanair ends talks with Boeing over large 737 Max order

Ryanair has terminated talks on a large order of Boeing 737 Max jets after failing to reach an agreement on price with the US planemaker.

The low-cost carrier, which is the largest European customer for the Boeing 737 Max, had been in discussions about ordering the 230-seat Max10 aircraft.

“Negotiations with Boeing for a Max10 order have ended without any agreement on pricing,” Ryanair said.

Last week, Michael O’Leary, the Ryanair group chief executive, put pressure on Boeing, saying a deal was unlikely to be achieved this year but the airline could order up to 250 new planes if the price was lowered.

“We are disappointed we couldn’t reach agreement with Boeing on a Max10 order,” O’Leary said on Monday. “However, Boeing have a more optimistic outlook on aircraft pricing than we do, and we have a disciplined track record of not paying high prices for aircraft.”

Boeing said that while it valued Ryanair as a customer it would only do deals at a price that makes commercial sense.

“Ryanair is a longstanding partner,” said a spokesperson for Boeing. “At the same time, we continue to be disciplined and make decisions that make sense for our customers and company.”

A deal with Ryanair, which has orders in place for 210 of the 197-seat Max 8-200 model, would have been a boost for Boeing, whose Max planes were grounded for 20 months after two fatal crashes.

Ryanair took possession of its first Boeing 737 Max aircraft in June, after a delay of more than two years, with a total of 12 planned to be in the air for the summer peak holiday period. The airline expects an additional 50 to be delivered before next summer.

Last week, O’Leary said Ryanair held the upper hand in the negotiations “because Boeing have recorded remarkably few orders for the aircraft, and they need a couple of large Max10 orders”.

He said Ryanair’s fleet would grow to more than 600 aircraft as it hoped to take advantage of a post-pandemic boom in air travel.

“We have a more than sufficient order pipeline to allow us to grow strongly over the next five years with a Boeing 737 fleet, which will rise to more than 600 aircraft and will enable Ryanair to capitalise on the extraordinary growth opportunities that are emerging all over Europe as the continent recovers from the Covid pandemic,” O’Leary said on Monday.

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Boeing’s European rival Airbus sealed a deal with Jet2 for 36 A321neo aircraft worth about $4.9bn (£3.5bn) last week. Boeing had supplied the British airline in the past. Last month, US carrier Delta Air Lines ordered 30 additional A321neo aircraft, taking the total it has on order with Airbus to 155.

“We do not share Boeing’s optimistic pricing outlook, although this may explain why in recent weeks other large Boeing customers such as Delta and Jet2 have been placing orders with Airbus, rather than Boeing,” O’Leary said.

On Monday, Singapore became the latest country to give the green light for the 737 Max to return to service. The Civil Aviation Authority of Singapore (CAAS), which lifted grounding orders on the aircraft after completing its technical assessment, joins regulators in countries including the US, Australia, Fiji, Japan, India and Malaysia in clearing the Boeing 737 Max to return to service. China, the biggest market in the Asia Pacific region yet to approve the return of the aircraft, conducted test flights last month.

source: theguardian.com