RYANAIR SAYS it has been in talks with both Boeing and Airbus about aircraft purchases beyond 2012, chief executive Michael O’Leary said yesterday.
“We’ve been trying to talk to Boeing about orders beyond 2012 but their prices are too high,” he told reporters in London. “We’ve started talking with Airbus about the possibility of taking Airbus aircraft,” he added, although he said Airbus prices were also too high.
Ryanair’s fleet comprises about 160 Boeing aircraft and is due to rise to 300 aircraft by 2012. The likely size of the purchase would be 200 firm orders and options for an additional 200 planes, Mr O’Leary said.
He added that prices should come down from both major manufacturers as collapsed or bankrupt airlines cancel orders. “We want to be in discussions with both Boeing and Airbus so it is possible to do a deal when the market collapses,” he said, adding he had no loyalty to Boeing despite their long relationship. “I prefer to go with the one that charges 10 bucks a seat less,” Mr O’Leary said.
Ryanair said last month it would ground aircraft at Dublin and London Stansted airports to help trim costs this winter as fuel prices and slowing economies weigh on demand for travel.
While the carrier may this year suffer its first annual loss since going public in 1997, Mr O’Leary says it will ultimately benefit from the slowdown as low-cost opponents are eliminated.
Mr O’Leary forecasts that further consolidation will follow in the European airline industry after British Airways and Iberia said last month that they were planning to merge. The tie-up is likely to be followed by Lufthansa combining with Austrian Airlines, SAS Group and BMI, he said.
“Clearly there needs to be more consolidation within Europe,” Mr O’Leary told reporters. “Europe is merging into about four or five main airlines in the next couple of years.”
Airbus, a unit of European Aeronautic, Defence Space (EADS), said it has held no discussions with Ryanair and doubts that the Irish carrier would switch from an all-Boeing fleet.
“We’ve been in sales campaigns with Ryanair in the past and were disappointed,” chief operating officer John Leahy said yesterday by telephone. “Such campaigns are extremely time-consuming and expensive and we’re doubtful we’d enter into discussions with them in the near term.”
Airbus has a backlog of orders that ensures at least six years of production. Boeing is working through a record $275 billion of orders, which will keep it busy building planes for at least eight years. – (Reuters/Bloomberg)
