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Two Ryanair planes on the tarmac of an airport
Ryanair has narrowed its profit forecast for the year to the end of March to €800m-€900m from €750m-€950m previously. Photograph: Marcel Kusch/AFP/Getty Images
Ryanair has narrowed its profit forecast for the year to the end of March to €800m-€900m from €750m-€950m previously. Photograph: Marcel Kusch/AFP/Getty Images

Ryanair hit by further delay to Boeing 737 Max deliveries

This article is more than 4 years old

Airline reduces expectation of number of planes for summer of 2020 and there is risk of none

Ryanair has warned there is “a real risk” it will have no Boeing 737 Max planes flying next summer because of further delays to the delivery of the grounded aircraft.

Europe’s biggest carrier is sticking to its plans to cut bases and pilot and cabin crew jobs and said it expected to receive its first 737 Max planes in March or April 2020, two months later than expected. The 737 Max remains grounded worldwide after two crashes in Indonesia and Ethiopia killed 346 people.

Ryanair’s chief executive, Michael O’Leary, said: “We have now reduced our expectation of 30 Max aircraft being delivered to us in advance of peak summer 2020 down to 20 aircraft and there is a real risk of none.”

Ryanair reiterated that this would more than halve its passenger growth rate next summer to 3% from 7%, with the airline carrying 157 million people over the year as a whole rather than 162 million as previously planned.

O’Leary said: “We have already reduced our passenger growth forecast … we may have to cut that again but, frankly, there is no point in keeping on changing the number until we get more certainty.”

US carriers, which are the main operators of the 737 Max, are still targeting the early months of 2020 to get their planes back in the sky. Regulators on either side of the Atlantic are preparing final tests to approve Boeing’s fix for the 737 Max’s controversial MCAS anti-stall system, widely blamed for the two crashes. On Monday the head of the European Union Aviation Safety Agency told Reuters the plane was likely to return to service in Europe during the first quarter of 2020.

However, airlines may have to overcome public fears of flying on the plane. Congressional hearings last week in Washington put Boeing under further scrutiny, with senators accusing the manufacturer of putting profit before safety, and one describing the 737 Max as a “flying coffin”.

All three US airlines that operate the 737 Max – Southwest, United and American – are now planning to hold hundreds of demonstration flights to reassure passengers that the model is safe to fly, according to the Wall Street Journal. A planned public relations drive will involve 737 Max flights taking off without passengers but carrying senior airline executives.

The Ryanair boss has described the 737 Max as a “gamechanger” aircraft for the airline, able to carry more passengers while burning less fuel than the existing 737-800s it operates. O’Leary ruled out any consideration of switching his large fleet order – a total of 135 planes – to a similar plane from rival manufacturer Airbus, the A320neo.

Separately, British Airways’ owner, IAG, has agreed to buy Spain’s Air Europa for €1bn to expand routes to Latin America and the Caribbean. The airline operates domestic and international flights to 69 destinations, with a fleet of 66 aircraft.

O’Leary said Ryanair would ask competition authorities to force IAG to give up some slots or routes before approving the takeover. He told an analyst conference call: “I think it is a good deal for IAG, for Willie Walsh [chief executive of IAG]. I think it is a bad deal from a competition point of view.

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“It is a merger to monopoly in Madrid and I think we would certainly be looking for the competition authorities to require some competition divestments, particularly in the Air Europa short haul.”

O’Leary said he supported consolidation in principle. Several smaller airlines have gone bust in the past 12 months, while others have been taken over, such as the British regional carrier Flybe, which was acquired by a consortium led by Virgin Atlantic earlier this year.

Ryanair reported a profit after tax of €1.15bn for the six months to 30 September, its most profitable part of the year, unchanged on the previous year. Fares have fallen 5%, while its fuel bill rose 22%. The Irish airline narrowed its profit forecast for the year to the end of March to €800m-€900m from €750m-€950m previously. It said it hoped to recoup the planned growth in 2021 should the 737 Max deliveries resume.

  • This article was amended on 5 November 2019. An earlier version described planes in Ryanair’s existing fleet as Boeing 737-200s. That should have said 737-800s.

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