Group Chief Executive Officer & Executive Director, Ryanair
Boeing 737 Max deliveries could be two years late: Ireland airline Ryanair
By the end of last year, Ireland's low-cost airline Ryanair was expecting to get the first 737 Max into its fleet. Now, it's not expecting ...
About Michael O'leary
Michael O'Leary reported a record full-year profit after tax of €2.26 billion for Ryanair, with traffic growing 4% to 208.4 million passengers. He stated that Ryanair has hedged 80% of its jet fuel requirements through March 2027 at approximately $67 per barrel, describing the company as the "best insulated, most hedged airline in Europe" amid rising oil prices. O'Leary noted that Ryanair's share price had declined despite the strong results, attributing this to market concerns about the airline sector. O'Le
Transcript (8 segments)
✨ AI-enhanced transcript with speaker attribution
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Andrew0:00
Anytime Ryanair says it may have to push back its growth plans up to two years due to delays in deliveries of the Boeing 737 MAX, Phil LeBeau joins us with the latest on this ongoing saga. Good morning to you, Phil.
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Phil LeBeau0:09
Good morning, Andrew. Ryanair CEO Michael O'Leary just wrapped up his conference call with analysts, and his comments on the MAX were fairly positive. Did you take a look at shares of Ryanair? We should point out—the thing we should tell you is that the company did post a solid profit for the third quarter, just under a hundred million dollars, but it's the comments from O'Leary that people are focused on. Remember, Ryanair was supposed to get its first 737 MAX back in May of last year. It's not going to get it until October of this year—that's the expectation at this point. But Michael O'Leary thinks this delay ultimately could work to Ryanair's advantage over the next several quarters.
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Michael O'Leary0:47
We'll sit down with Boeing, redo the schedules, every schedule based on what they can achieve, and then we will update the market with our traffic growth. But what it means, certainly for this year and next year, is slower traffic growth. That's probably good for us, since we're the one who delivers more—we're the airline that grows most and fastest in Europe and America. There's probably upward momentum on our fares and less capacity pressure in Europe.
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Phil LeBeau1:15
You take a look at shares of Boeing. Keep in mind that Ryanair has 210 737 MAXes on order, and Michael O'Leary saying just a few minutes ago that they also plan to order several 737 MAX 10s—that's the stretched version of the MAX. They haven't officially placed that order yet, but at some point they will. So fairly positive, guys, from Michael O'Leary regarding the moves that Boeing has made to get the MAX back on schedule, ultimately certified perhaps by the middle of this year, and then back in service.
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Becky1:48
Phil, does that surprise you to hear that it might take two years for them to get the deliveries of some of these planes, or is that just to be expected?
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Phil LeBeau1:55
It's the math when you shut down production, correct. That is what was expected. And look, they have been pushing this out three months at a time, three months at a time, three months at a time. I think Michael O'Leary, as well as other airline CEOs, feel a little more comfortable with the current schedule that's been set up here. There's a little bit of flexibility built in there as Boeing works with the regulators—both the FAA as well as EASA over in Europe and other regulators around the world. The fact that they have to stretch out how long it will take them to get to their passenger target—Becky, I think that's pretty much what people were expecting. They certainly were expecting that it was going to be at least a year, a year and a half, so two years is not a huge stretch for people to understand, at least the analysts.
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Andrew2:38
And Phil, what do you hear in terms of the relationship that Boeing has with its customers, these big airlines, at this point?
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Phil LeBeau2:44
Well, it's fragile but improving. And it certainly has improved under Dave Calhoun as the new CEO. You've got him as CEO, and then you have Larry Kellner, the former CEO of Continental Airlines, who is now the chairman of Boeing. They've made a concerted effort since Dave Calhoun was put into the CEO position to work closely with the airlines, to say, 'Look, we understand the position that you're in. Here's what we're doing.' Much better communication than there was in the past under Dennis Muilenburg. In fact, I've heard that back from airline executives—that they feel more comfortable dealing with Dave Calhoun and Boeing right now than they did, let's say, three or four months ago.