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Ryanair pulls back on growth

Natalie Cooper  Dec 21, 2009

It seems that a big war of words has now broken out between Ryanair and Boeing. This war started after talks broke down over a potential order of up to 200 planes. The budge airline’s chief executive, Michael O’Leary, has accused the aircraft manufacturer of moving the goalposts during the negotiations.

Ryanair said it would now rein in its growth and expenditure and return the money saved to shareholders. Michael O’ Leary said, that they regret that their prolonged negotiations with Boeing have failed to reach a mutually acceptable conclusion. He said that while they reached agreements with Boeing on pricing for 200 aircrafts delivered during the 2013-2016 period, Boeing is now unwilling to incorporate some other terms and conditions from their existing agreement into the new aircraft order.

He went on to say that Ryanair has made it perfectly clear to Boeing that they will not order aircrafts if they believe that either the pricing or the other contractual terms and conditions will be inferior to those which they currently enjoy. On top of this, Michel O’ Leary has ruled out reopening any further discussions with Boeing.

The airline has been negotiating for some time to buy the B737-800 aircrafts for delivery between 2013-2016. The 200 planes have a list price of $15 billion, but Ryanair has been negotiating to secure a hefty discount. Thus, the price that Ryanair was going to pay for the planes has not been said, nor will most people ever know it. Ryanair did note that the break down in negotiations would not affect the delivery of 112 B737-8’s that are going to be delivered over the next three years.

Ryanair pulls back on growth
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