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Big European discount carrier may end order talks with Boeing

Post by John Gillie / The News Tribune on Nov. 2, 2009 at 9:14 am |
November 2, 2009 9:16 am

Ryanair, Europe’s largest discount air carrier, may end talks with Boeing for 200 more 737 jets unless the manufacturer cuts prices.

Ryanair Chief Executive Michael O’Leary said negotiations to buy the 200 planes have stalled.

“I regret to report that we have made little progress in our discussions with Boeing for an order of 200 aircraft for delivery between 2013 and 2016,” he said.

“We won’t continue these discussions indefinitely and have signaled to Boeing that if they are not completed before the year end, Ryanair will end its relationship with Boeing and confirm a series of order deferrals and cancellations,” the plain-spoken CEO said.

Ryanair has made cost-cutting its mantra. It ordered a huge fleet of new 737s at reported bargain prices after the 911 tradgedies when aircraft orders were low.

The flambouyant O’Leary is hoping to repeat that bargain purchase now that the recession has most airlines retreating from orders.

Ryanair’s fleet is all 737s. Airbus reportedly has told the airline that while it would like the carrier as a customer, it’s unwilling to cut prices as steeply as O’Leary wants.

If the airline cancels or defers orders, it would signal an end to the headlong growth that has propelled the Irish discount carrier to the top rank of European airlines.

Ryanair, noted for its cheap fares, is also notorious for cost cutting. O’Leary has seriously proposed adding an admission fee to aircraft restrooms. The company now is attempting to end counter check-ins entirely. It has eliminated window sunshades and seatback pockets to cut costs and weight from its flights.

Many of its flights land at secondary airport outside large cities to reduce landing and terminal fees.

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