Ongoing 737 MAX grounding forces Ryanair to reconsider expansion program

©Ryanair

Ryanair has been forced to rethink the timeline for its current expansion program. The Irish airline had hoped to be carrying up to 200 million passengers on an annual basis by 2024, but this depended on the arrival of the first deliveries of 210 Boeing 737 MAX jets which are on order. With the 737 MAX still grounded and unlikely to receive its new FAA certification of airworthiness for upgrades to the software and internal wiring before the middle of the year, Ryanair has had to have a serious rethink about its expansion strategy.

Ryanair chief executive, Michael O’Leary, said Boeing’s problems could ultimately delay the plane’s entry into service for the airline by two years: “What is likely is they will push out that delivery profile with Boeing by at least 12 months. At best that means we will have to roll forward our plans to fly 200 million passengers per year … by at least 12 months, possibly 24.” That would result in Ryanair reaching its 200 million passenger target in March 2026 rather than March 2024.

Ryanair now expects to start taking delivery of up to eight planes a month from September this year. However, it is now currently re-examining its orders with Boeing with a view to upgrading to the larger 737 MAX 10 which has more seats and a leaner fuel burn than the 737 MAX 200.

The airline reported a profit after tax of €88m (US$97.7m) for the three months to the end of December, the third quarter of its financial year, as average fares rose by 9% and ancillary revenues – from extras such as pre-booked seating – rose by 21%.

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