Ryanair Airlines to raise fares due to the situation of Boeing delays

Tuesday, February 27, 2024

Ryanair has issued a warning that there may be a necessity to hike the prices for its flights and eliminate some routes from its summer schedule. This situation arises from the production delays encountered by Boeing in the manufacturing of the 737 Max, resulting in the airline having access to fewer aircraft than initially anticipated during its peak season.

Based in Dublin, Ireland, the airline was anticipating the arrival of 57 Boeing 8200 aircraft, a version of the 737 Max, by the end of April. However, they were informed by Boeing more than a week prior that only about 50 of these planes would be delivered by the end of June.

The uncertainty surrounding the exact number of aircraft Ryanair will receive in the upcoming months remains, with CEO Michael O’Leary expressing the airline’s predicament during a media briefing. O’Leary conveyed the airline’s difficulty in predicting the number of aircraft it will obtain from Boeing, with estimates ranging from 30 to possibly 50 planes. He noted that if the airline receives only 40 aircraft by the end of March, it would be compelled to announce minor schedule reductions, likely affecting its passenger capacity, which would decrease from the forecasted 205 million to 200 million for the financial year commencing in April.

Furthermore, O’Leary mentioned that the airline plans to pass some of the costs stemming from these delays onto its customers, predicting a price surge of 5% to 10% over the summer. He also projected that the average fare could increase by 10 to 15 euros in the forthcoming five years.

The delays are partly due to increased regulatory scrutiny over Boeing’s manufacturing lines following an incident on January 5, when a panel on a 737 Max 9 blew out midair during an Alaska Airlines flight. This has led the Federal Aviation Administration (FAA) to restrict Boeing from increasing its production rate of the aircraft.

O’Leary also shared insights into Ryanair’s ongoing discussions with Boeing regarding financial compensation for the delays, alongside a critical assessment of the aerospace manufacturer’s handling of the situation. He described the ongoing issues in Seattle as severely mismanaged, highlighting the pattern of overly optimistic promises from Boeing that ultimately prove to be unfounded. Despite these challenges, O’Leary emphasized the airline’s primary goal of securing the necessary aircraft to maintain its operations.

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