Ryanair said today it had ordered 70 Boeing 737-800 aircraft and had taken options to buy a further 70.
The carrier said the firm orders were worth €3 billion and would enable it to create 2,500 jobs become Europe's largest airline in seven years.
The airline said in a statement it had placed a new firm order for 70 of the aircraft, and options for another 70 with delivery scheduled between 2008 and 2012.
"With this new order and new pricing in place, Ryanair expects that unit operating costs excluding fuel will continue to fall each year for the next five years," Ryanair Chairman Mr David Bonderman said in a statement.
Ryanair is already scheduled to have taken delivery of about 100 new Boeing aircraft by the end of this year from a previous firm order of 155.
The airline is expanding aggressively in Europe amid a backdrop of tough competition and high fuel costs.
Mr Bonderman said the company planned to double the number of passengers it carries to 70 million passengers per year when all the aircraft have been delivered, and would create 2,500 extra jobs for pilots, cabin crew and engineers.
"With this new aircraft order, it confirms they are going to continue growing at double-digit rates until 2012 at least. It is achievable. You will see most of the growth from European bases," BNP Paribas analyst Mr Geoff Van Klaveren said.
The deal is a boost for Boeing in its efforts to recover the market lead for aircraft sales from rival Airbus, which has topped it in annual deliveries for the past two years.
Boeing's list price for the plane is $65 million, putting the value of the deal at up to $9.1 billion if all options are converted to firm orders.
However, Ryanair boasted it had received a steep discount and said the firm orders were worth more than $4 billion.
"Boeing had their order book a little bit empty out in 2008-2011, and we thought it was time to extend our horizons a bit ... we see it a bit like a free seat, we think it's a Boeing free seat sale," Ryanair Finance Director Mr Howard Millar.
Ryanair had warned of a bloodbath for European airlines this winter as stiff competition drives out rivals, high fuel costs bite and ticket prices fall. However, it raised forecasts last month after a stronger-than-expected fiscal third quarter to end-December and has continued to expand despite falling yields -- or average revenue per passenger.
Ryanair executives told analysts today they still expected yields to rise by up to 5 per cent in the fourth quarter, before more declines next year. The carrier also announced plans to install winglets across its entire fleet of 737s, worth about $11 million, which it said would lower its fuel consumption by 2 per cent.