Published on : Friday, July 19, 2019
Ryanair will fly 5 million fewer passengers than planned in the year 2020 owing to delayed deliveries of Boeing’s grounded 737 Max aircraft, and warned that jobs would be affected and airport bases closed as a result.
Ryanair, Europe’s biggest low-cost carrier was expecting to bring the first five of 135 planes on order into service this year, and 58 by next summer. On Tuesday it said that on a “prudent” estimate it would have about half that number but there were no guarantees.
Ryanair now expects to carry 157 million passengers in the year to March 2021, cutting its summer 2020 growth rate to 3% from 7%. The lower than expected passenger numbers suggest the airline will cut about 30,000 flights from its plans for next year.
The Boeing 737 Max remains grounded worldwide after two crashes in Indonesia and Ethiopia killed a total of 346 people. Boeing has yet to convince regulators that its modifications are sufficient to ensure the plane’s safety.
The Ryanair chief executive, Michael O’Leary, said that Ryanair remains committed to the 737 Max aircraft, and now expects that it will return to flying service before the end of 2019. The airline has ordered a larger, 197-seat version called Max 200, a variant that it expects to be separately certified as safe a month or two after the 737 Max 8 fleet returns to the sky. It hopes to receive its first aircraft in January or February 2020.
O’Leary said the shortfall in deliveries would mean some base closures over the winter, potentially including routes where flights have already been sold, as well as cuts next summer. He said that it will have ramifications for pilots and cabin crew, and we will have to enter into intensive negotiations with our people and unions.
It emerged this week that a 737 Max aircraft due to be delivered to Ryanair had the name Max dropped from the livery, fuelling speculation the manufacturer and airlines will seek to rebrand the troubled plane once it is given the all clear to fly again. Neither Boeing nor Ryanair have taken responsibility for the change.
Ryanair shares rose by 2%. Shares in rival carriers EasyJet and IAG also rose, possibly on hopes that fewer planes in the skies will enable airlines to raise fares again.