Low-cost Irish carrier Ryanair has announced it is halving its growth plans for 2020 as a consequence of the grounding of the Boeing 737 MAX jet. As one of Boeings largest customers, Ryanair was anticipating having 58 of the single-aisle jets delivered and operational by summer next year. However, in a statement by company CEO Michael O’Leary, Ryanair anticipates that deliveries of the jet, grounded since March after a second fatal air crash, would be unlikely to recommence before December.
As the carrier can only process five to six new aircraft per month and does not accept deliveries during the peak operating months of June through August, Ryanair is now making plans to have only 30 of the 58 737 MAX jets operational for the summer of 2020. “This number could rise or fall further, depending on when the B737 MAX actually returns to flight services,” O’Leary stated, adding that the carrier now anticipates flying 159 million passengers in the financial year March 2020 to March 2021, an increase of only five million additional passengers as opposed to the anticipated ten million. “While it is disappointing that we have delays and disappointing that the growth for next year will be slower than … we had originally planned, we remain confident in the aircraft. We still think it is a great product,” O’Leary told investors in a conference call. “As soon as we can reasonably organize these deliveries with Boeing, we would intend to take all of the 135 firm aircraft we have ordered over the next five years,” he said.
While shares in Ryanair rose 2% at one point after release of the news, shares in other European carriers rose even further on the basis that the cuts being made by Ryanair would solve a problem of overcapacity in a saturated European market.Email Post to a Friend