A Commercial Aviation Consultancy

Take a look here please.  The story about new airplanes for Ryanair is a long one.

So let’s focus on what the pending order means. Note that the Reuters story quotes the airline as saying nothing will happen until the end of this year or early next.  The airline has been toying with OEMs for a long time – flirting with Airbus (not taken seriously by anyone) and of course the funny stuff with COMAC.  All of which was to try squeeze Boeing for a deal like they got in the aftermath of 9/11. That was never going to happen, but try they did.

Meanwhile the game goes on – Ryanair is coy about the pending order.  Boeing says nothing, as one would expect.  The news comes from a reliable source and we think its credible.

Reuters points out the order would be for the NG, which is really interesting.  Boeing could get a big NG order and this provides a bridge it needs as it ramps up the MAX program.  Moreover, Ryanair can get a deal on NG that it would not on MAX.  Michael O’Leary, Ryanair’s boss has been scathing in his comments about MAX.

An order for 737NGs therefore offers a convenient outcome for both sides – Boeing gets a desirable bridge order and Ryanair does not look silly. Boeing can offer a great financial package on the NGs (and probably ensure a MAX order after MOL retires).  Keeping Ryanair in house is important to Boeing.  Ryanair on the other hand will be able to trumpet that it got a deal better than anyone else.

© 2013, Addison Schonland. All rights reserved.

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