Ryanair orders 737 MAX, giving boost to Boeing

By Scott Hamilton

Dec. 3, 2020, © Leeham News: Ryanair today announced an order for 75 Boeing 737-8 200 MAXes.

This is the first big order for the airplane since the March 10-13, 2019, grounding. It’s the first since the US Federal Aviation Administration and Brazil’s ANAC lifted their grounding orders last month.

Europe’s EASA plans to lift its grounding order in January. Ryanair, of Ireland, can’t fly the MAX until EASA acts.

The deal is a boost for Boeing and a vote of confidence in the MAX. The global fleet was grounded following the second of two fatal accidents.

Order was expected

Ryanair was expected to eventually place an order for the airplane. It had 135 orders already and it operates about 450 737s of all types now. Its Group CEO, Michael O’Leary, is a loyal Boeing customer. He’s also well-known for taking advantage of situations in which he can get bargain-basement pricing.

The deal has a list value of $7bn. But with discounts, the true value is estimated closer to $3bn or less. Neither Boeing nor Ryanair commented on pricing. He said the discount “was not enough,” calling it a “modest discount.”

“We don’t feel a need to discount our way into the marketplace,” said David Calhoun, CEO of Boeing.

Ryanair now has orders for 210 737-8-200s, which is also called the 737-8200.

Boeing’s press release uses the term MAX in the headline but not in the text. O’Leary generally avoided using the term MAX, preferring the “8200” designation. This continues the apparent trend away from the damaged MAX brand. (Ryanair’s slides did mention “MAX.”) Calhoun said there is no rebranding underway. The MAX is part of the 737 family. “There is nothing cute going on,” Calhoun said.

O’Leary said the order will be “compressed,” to accelerate delivery over the next five years.

Recovering from COVID

Depending on how quickly Europe recovers from COVID,

“This is the most scrutinized, most audited airplanes in history,” O’Leary said. Ryanair has three MAX simulators. Flight crews are going through training. “I cannot tell you how confident we are” in the safety of this aircraft.

Calhoun said he “always had faith” the order book will begin filling as vaccines became available. “I am confident this is the beginning.”

O’Leary said confidence in Boeing began when the new management team of Calhoun and Stan Deal, named president of Boeing Commercial Airplanes, came on board in January and October.

“There is going to be a very strong recovery next year” as vaccines come on board, he said.

Future orders, no tariffs

O’Leary said he is discussing an order for the 737-10 MAX. He also predicted that when Joe Biden becomes US president Jan. 20, the trade war between the US and Europe will be resolved. This will remove tariffs on Boeing and Airbus airplanes, he predicts.

 

 

63 Comments on “Ryanair orders 737 MAX, giving boost to Boeing

  1. Won’t make me set foot in a Ryanair plane. I have been avoiding that company for years and this won’t change.

    I am sure the MAX will be safe though.

  2. From “SEATTLE TIMES”
    “Boeing must have given O’Leary a deeply discounted deal.

    Boeing’s sales team has been offering bargains to move more than 60 MAX aircraft already built for buyers who have backed out. And O’Leary famously times his orders to negotiate aggressively low pricing.”
    profitable????
    but as LEEHAM says, these RYANAIR machines are 737 8200, not any of the parked 60 MAX which will have to be transformed for other customers specs at a significant cost.
    profitable????

  3. This is not necessarily a big boost for the mad max. The 737-8-200 was specifically designed for Ryan Air cattle car strategy. No other customer wants it and it will be a slow seller just like the -700 NG. Besides I’m sure Boeing practically gave these away to keep the boys on Wall Street happy and Michael O’Leary in the 737 camp and not sway to the AB side.
    Now the Boeing executive’s can reap their bonus this year for such great performance.

    • The interesting side info seems to be that Boeing overcame the certification hurdles for that sub-type.

  4. The image used in the article on the BBC website shows the aircraft branded as 737 – 8200 (no space between the 8, and the 200) as Scott states in the article.

    https://www.bbc.co.uk/news/business-55177846

    I do wonder how much Ryanair paid for them ? @Scott $3Bn over 75 aircraft is around $40 Mn isn’t it ?

    So if that’s not a discount, is it part payment for the delay in handing over the MAXs that Ryanair ordered ?

    Were these just the 75 options that Ryanair held ?

    Any idea how close this is to the cost to produce each airplane ?

    “He said the discount “was not enough,” ” but he did the deal anyway ?

    Tim, ditto, we have a fair amount of choice here so not difficult to avoid them. It seems Easyjet may now start charging for overhead locker space, so perhaps all low cost carriers will end up selling you a basic ticket, and then charging you for just about anything except perhaps breathing. Perhaps next is a fee for using the ‘bathroom’ …

    • I read that FR exercised their option, also, buyers now are able to walk away from over a thousand purchase commitments, Boeing is obliged to offer “Gr8t” deals!!

  5. Not sure I’m allowed to submit this, but it does explain to non-European readers how Ryanair is viewed. Ryanair promotes its terrible service on the basis of “what did you expect for such a low price?” and thus positions itself as low cost above all else. And thereby has become the most successful LCC in Europe.

    A man is alone in an airport lounge. A beautiful woman walks
    in and sits down at the table next to him. He decides, because she’s wearing a uniform, she’s probably an off-duty stewardess. So he decides to have a go at picking her up by identifying the airline she flies for, thereby impressing her greatly.

    He leans across to her and says the British Airways motto: ‘To Fly. To Serve’.

    The woman looks at him blankly. He sits back and thinks up another line. He leans forward again and delivers the Air France motto: ‘Winning the hearts of the world’. Again she just stares at him with a slightly puzzled look on her face.

    Undeterred, he tries a third time, this time saying the Malaysian
    Airlines motto: ‘Going beyond expectations’.

    The woman looks at him sternly and says: ‘What the f*** do you want?’

    ‘Ah ha!’ he says, “Ryanair”.

      • @TW

        We all deserve RyanAir the most successful airline showing the rest the way – welcome to the future

        • In Europe, Ryanair’s greatest contribution to the aviation landscape was the fact that the airline started to make use of secondary airports — which had customarily been ignored by the flag-carrier airlines. This gave passengers from outside the biggest cities the opportunity to fly from their local airport, and it also afforded Ryanair shorter turnaround times, lower airport usage fees — and in some cases, subsidies from local authorities. Wizzair also copies this model, but Easyjet tends to stick to the bigger airports.
          Since most of us don’t live in capital cities, use of secondary airports is a blessing.

          • “Hamburg” is RY for Lübeck 🙂
            ( OK their number plate tag is “HL” as in Hamburg Land 🙂

          • Ryanair and Wizz seem to have almost completely left Flughafen Lubeck a few years back.
            So much for a regional airport that was ‘too regional’
            I thought their number plate code was HH – Hansastadt Hamburg

          • HL stands for Hansestadt Lubeck, they would be offended to be a ‘lande’ a modern invention, when their free city status goes back almost 800 years

          • It’s great for local pax to use secondary airports, but don’t call them Frankfurt-Hahn, that’s just garbage.
            But Ryanair doesn’t do it for pax, they only do it because they are too cheap and that’s garbage too.
            On top of it this garbage airline don’t accept the rules. I would fine them till they stop flying.

          • Italy is a good example.
            Alitalia only ever bothered to offer international flights in/out of Rome and Milan.
            In contrast, Ryanair has 15 bases in Italy.

          • Good point Bryce.

            A common approach, for example out here on the wet coast WestJet in its formative days began serving Vancouver BC from Abbotsford BC ‘s under-used airport to the east.

            But there are strategic choices, one new airline wannabe planned to operate out of Vancouver BC instead of Abbotsford BC because it is more convenient. (I’d want to look at the demographics they are targeting, YVR has a very good rapid transit line to it from downtown Vancouver, with rapid transit lines connecting from other parts of that city to the southeast and to suburbs to the east. (But not to Abbotsford. Population near and east of it has been increasing though.)

            And at one time people living south and east of Vancouver BC were driving to Bellingham WA to catch flights south, some connecting through airports like SeaTac, n/c parking was an extra attraction at the time.

      • I don’t understand the consumer buying the cheapest flight available. If that applied to auto purchases, we’d all be driving Yugos. I won’t do the cheapest available again. I did that once. Two different airlines – each blaming the other, neither helping.

    • From which we can conclude that Ryanair stewardesses are “beautiful women” who resent cheap pickup attempts…after all, we mustn’t forget that part of the text, must we? 😏

      I had zero problems with Ryanair up to now. I’ve been flying with them for 20 years, and I find them to be no better or worse than Air Asia or Jetstar, for example. However, the 28″ seat pitch is going to be a disaster…even with slimline seats. Luckily, Wizzair (A320s/A321s) are expanding aggressively, so that should offer more alternatives.

      • My last flights were on Vueling, and I would definitely fly with them again, Norwegian were fine also, not sure if they’re going to survive though. It would be a pity if they don’t.

        I’ve not had any issues when I’ve flown EasyJet.

        • Yes. It seems the people with the worst Ryanair horror stories are those who dont fly with them. ( …..Every airline has them)
          Yet it became Europes biggest airline

    • Flying RY is unspectacular. ( except for the fun of watching those with oversize handbags trying to wrangle those through the template offered from ground staff with a snicker before boarding .-)

      Ryan Air works its depravity on the (pseudo) employee side.
      They are bypassing established worker protections for their own financial benefit.

  6. Reuters: “Ryanair is expected to win discounts closer to two thirds in return for a headline-grabbing relaunch of the MAX that helps fill gaps left by cancellations.”

    Tariff: time is on European’s side, no?

  7. Its a ray of light for Boeing employees in a very large and dark tunnel.

    Lets home management ups their game and at least delivers FOD free aircraft.

  8. The discount cat has many lives. If not the upfront price it could be maintenance costs, or even an over finance deal where Ryanair gets cash in it’s hands each time upon delivery of a brand new plane.
    Southwest will be watching this deal with gimlet eyes , so expect them to follow suit

  9. Neither Boeing nor Ryanair commented on pricing. He said the discount “was not enough,” calling it a “modest discount.”

    Who is he?

    If the discount is not enough why did Michael O’Leary order it?

    • @RS

      O’L is playing the game, why would he exult at the very low price he got? so that others might know it is possible and seek to copy him?

      He talks it up he talks it down – if you have to bet who got the better deal, him or Calhoun, put your money on O’L

    • For O’Leary, whatever the discount is, it’s not enough. And “modest” is a highly subjective term.

  10. Did I read 7 billion discounted to 3 billion?

    That’s a fire sale price.

    • @Keith: Not necessarily fire sale. Before the MAX grounding, we were seeing discounts of >60% in some campaigns.

      • Thanks.

        Seems crazy, there are benefits to volume orders depending on cost of support to each operator and keeping production line flow, but at some point ‘list price’ is a joke and worse losing money often is a recipe for failure.

        7 down to 3 is a 60% drop.

        Note there are other ways to give someone a deal without lowering the price of the airplanes.

  11. I suppose these are slots (8200 not the same exits as the 8, are they?) whose original customers will get remarketed white tails instead? Or is BA filling in slots which have been freed by further cancellations? Deliveries run to end of 2024 when BA would have been hoping not have free slots.

    • The UK 737* org * uk site ( not https so wont link) says:
      ‘This is a 200 seat version of the MAX 8 which has an extra pair of Type II doors aft of the wing (as in the 900ER and MAX 9) giving it a maximum certified passenger capacity of 200. The seat pitch will remain at 30 inches with space ..being gained by slimline seats and removing space from front and rear galleys.”

      It seems that the Max 10 will have the extra pair of emergency doors as Type I instead of Type II ( which means they are 4 in wider)

      • Interesting. Although the current seat pitch in Ryanair NGs is oficially 30″, so it’s difficult to see how they’ll be able to get in two extra rows of seats without reducing pitch. And won’t the extra exits require a slightly greater seat pitch at the exit row? Apart from that, the math seems to add up (more or less): 32 rows to 34 rows is approx. a 1/16 increase, and 30″to 28″ is approx. a 1/15 decrease.
        The current 30″ pitch is tight on my knees if the plane has seats of standard thickness, but much more comfortable when it has slimline seats. With a 28″ pitch, the seat will have to be paper-thin if there’s to be any legroom at all.

  12. Is this really a vote of confidence? I assume an unsafe design only makes an aircraft more attractive to O’Leary — he can negotiate an even better price on it then.

    • No unsafe design. Please read the FAA final report. Time to lay that falsehood to rest. The market is what it is, all aircraft are selling at a discount right now, with customers renegotiating earlier orders. It’s an opportunity for airlines if they can get the financing or lease-backs.

      Udvar-Hazy said he expects airlines to emerge from the pandemic with smaller but much newer fleets. In the long term, that’s a good thing for the industry, and as things pick up, the market will grow with further new additions.

      I suspect there will be further MAX additions, now that the uncertainty of the grounding is lifted. But only time will tell how many.

    • @Mike A

      For sure this Max crisis plays into O’L’s MO, he’s got Boeing sitting in his lap, purring

    • If O’Leary had originally just ordered standard -8s instead of the modified -8200s, he could have picked up all those whitetails at super discounts. So he shot himself in the foot to a certain extent. He should have just ordered a standard plane rather than seeking a model that was specifically conceived for him. His rivals at Easyjet/Wizzair have 235/230 seats in their A321s, so they’re still beating him on unit costs and slot usage.

      • @Bryce

        Was not O’L’s order before the Max thing crashes?

        Now it’s all different, yes, but he has to make the best of a bad situation – meanwhile is he not hedging his bets?

        Or does Airbus hate him too much?

        • @Gerrard,
          O’Leary’s order was indeed from before the crashes, but he still had 75 options which he hadn’t yet exercised (until yesterday). If he had originally ordered the -8, he could have taken those 75 options from amongst the “bargain basement” whitetails.

        • @Gerrard
          With regard to the relationship between Ryanair and Airbus, I’m not sure who hates who the most. A disadvantage for Airbus is that Ryanair is a big Boeing customer, and Boeing will probably always be prepared to go to extra lengths (e.g. attractive discounts!) to keep it that way. Similarly, I think Airbus would be very willing to offer sharper-than-normal discounts to Southwest if it was felt that they could win the airline from Boeing. It probably annoys Boeing that there are relatively many all-Airbus “new” airlines in the US (Spirit, Frontier, JetBlue, Allegiant, Moxy), but relatively few all-Boeing “new” airlines in Europe (Ryanair).
          It really is a pity for Ryanair: with the A321, A321(X)LR and/or A220, it could really diversity and expand its network.

  13. The 737-8-200 is the 200 passenger, one bathroom version created specifically for Ryanair. Don’t see how Ryanair can claim that this interior “increases guest experience.”

    • I guess that old people and families with young children will avoid Ryanair because of lack of bathrooms.

      Reminds me of the competition between Douglas and Boeing to replace Pacific Western’s 707s. DC10-30 vs 747SP vs L1011-500.
      Douglas were slippery, for example one day they showed up with a cabin layout drawing that they inferred was all of one seat pitch when in fact a significant portion was of 1 inch less spacing.
      Boeing suspected such, so one day showed up with a layout showing 450 seats, trying to keep a straight face for a while. I don’t know if executives got the point.
      (I thought the L1011-500 was the best for overall size compared to the 707, but Lockheed were not very good at selling. Too bad as an order from PW might motivate other charter operations to look at the airplane. Wardair went up to regular 747s.)

      But it became moot because PW decided to stop international pax charters, other than into Mexico with 737s used on scheduled routes. (PW did well using might and weekend 737 capacity.)

      (Seat spacing, lavatories, and other comfort factors are varied.)

  14. By giving huge discounts to Ryanair Boeing pushes Ryanairs competitors into the arms of Airbus. We will see in the future if there will be 3 large Airlines in Europe flying narrowbodeies, Ryanair, Wizz and maybe Easyjet at rock bottom prices?

  15. “Most scrutinized aircraft in history”. Gives me always a laugh when I read it. When Dickson was too lazy to check all cert documents.
    And Scott posted it twice haha. Thanks Scott, I know it’s painful to have a heart for Boeing.

    “Most audited aircraft in history”. Sure, from a Boeing perspective, when Boeing never made for certification needed independent audits before.

    “Strengthened multi-lateral regulatory oversight”. When other regulators were not allowed to check all cert documents too. That’s why there is a deal in place.
    Lets see what other regulators will do. Bjorn mentioned this already.

    “Reviewed all aspects of flight control systems”. When systems still rely on single AOA data.

    The MAX will crash again.
    It’s impossible that this Frankenstein won’t crash.

    • In its day, the post-crash Comet was probably “the most audited aircraft in history”, but it still was a non-runner because it was overtaken by newer aircraft / changing trends.
      The same could be said of the post-crash Concorde.

      Even if it has been thoroughly audited, it’s still a flying dinosaur…the only major-market in-production passenger airplane that’s not FBW. The -9 and -10 are vastly out-competed by the A321 neo, and the A220 offers a nice alternative for the -7. And there’s no sign yet of re-certification in China. So, we can all console ourselves that the MAX will be the end of the line for the 737.

      In the meantime, we’ll just have to wait and see to what extent the auditors had tunnel vision. If they got it wrong and there’s another crash relatively soon, then it’s over and out.

      • Bryce, welcome back and thanks for your negative assessment, predicting the worst outcome as always.

        The truth is that the MAX is very likely to be successful, as it was before the accidents. All the major airlines and industry players expect this. People will build confidence in it over time.

        For those who understood, the FAA final summaries and concurrence by the other regulators, made an impact. More people are defending the MAX and Boeing against the speculation that was laid to rest in the report. That has reduced uncertainty in people’s minds. Especially with regard to the inherently unsafe, inherently unstable narratives.

        The requirement for mandatory training has made it less taboo to speak of the role of the pilots. Where once you were called horrible for suggesting pilot error, now it’s being recognized as a causal factor. Even Dickson referenced it in his press conference on recertification. A year ago, that wasn’t possible.

        Another example in Indonesia, in an incident with a Lion Air A330 where pilots argued over who had to land the aircraft in poor conditions, then had a runway side excursion. The NTSC openly criticized the DGCA for not adhering to international guidance for proficiency checks and exemptions. They said that the two pilots had created “a hazard to flight safety”.

        Lion Air was successfully able to deflect criticism onto Boeing, but the downside of that is the problems there still remain.

        There are still hard-liners that are anti-maxxers, just as there are the anti-vaxxers. Those people will never be convinced, and are lost as Boeing customers. But I have increasing faith that in the absence of the steady stream of negative coverage & commentary, most people will come to regard the MAX as they do the 737 family in general, as a reliable aircraft.

      • @Bryce

        Welcome back

        Off topic I am afraid, but this will interest you – and by the way you are right about the re cert Max thing, wait and see is wise, as with the ‘vaccine’

        MSM is at last picking up on how to stop or rather prevent pandemics – reform ind ag

        https://www.chicagotribune.com/opinion/commentary/ct-opinion-coronavirus-pandemic-factory-farms-eliminate-20201203-4jprqxvjsfeklnmln6vowu2bje-story.html

        In other good news Pfizer say they do not know if their vaccine will prevent transmission of the virus

        https://thehill.com/news-by-subject/healthcare/528619-pfizer-chairman-were-not-sure-if-someone-can-transmit-virus-after

        If they do not know, who does?

          • Rob:

            Not sure there is no place you would not go to [edited] defend Boeing.

            The pilot training is to mitigate as much as possible and make sure pilots can deal with a MCAS failure.

            Boeing test pilot could not react in the time frame Boeing lied about and they knew it was there and what it did.

            The pilots of Indonesian and Ethiopian were overwhelmed with conflicting data.

            The system is now actually explaned (sp pun intended) so they actually know its not only there, but what it does and how to react to it.

            The need to train on MCAS is an admission of guilt.

          • TW, as I said that narrative has dominated for a long time, but is being laid to rest now. I thought that might happen over time, as the facts will always out. You cannot reconcile that narrative with an objective appraisal of the accident data.

            That’s part of the reason for the caustic assault on Dickson for the test flight, as well as on the American promo flight this week. It will continue for awhile but as the pilots see for themselves and take up the argument, that will not go unnoticed.

            It’s also a function of the desire to place blame on Boeing exclusively. Most that acknowledge pilot error don’t view it as an excuse or absolution of Boeing, it’s just a truthful appraisal of what happened. It doesn’t let Boeing off the hook for MCAS.

        • @Gerrard
          Many interesting news items with regard to vaccines have appeared in the past few days, and are continuing to do so at increasing frequency, but let’s save that discussion for another article where it will be considered more on-topic.
          As a short answer to your question: months worth of data from chimpanzees have suggested that the vaccine will not be impressively effective in preventing transmission…Fauci even alluded to this last month. But we can discuss that another time.

          • And you have some high level skills with understanding vaccine trial data ?…or you saw it on youtube but cant provide any reputable backup for that claim.

      • I think with the increased capability and fuel efficiency of the MAX, the ratio of the 9/10 to the whole MAX program will increase vis-a-vis the ratio of the 900 on the NG.
        How many units will they produce over the life of the program? A few years ago I was predicting 16K, but of course with all recent events and a changing world, perhaps 4K to 8K is more realistic.
        I still see a good chance that the 10 gear will be added to the 9 for access to shorter runways for the 9, or that additional fuel tanks will be added to the 8 or 9 for added range models.
        Having flown on the base 707 cross section my whole life, I second the hope that the MAX is the end of the line. Wider seats on a new aircraft like those of the A220 would be nice.

  16. Ryanair’s 737-8200 seats 197 passengers. They have 3 cabin crew. If they add another 3 passengers (for 200pass) they have to at a 4e cabin crew.

    • There must be one member of cabin crew per 50 seats, or portion of 50. The current -800s and the future -8200s thus have 4 cabin crew each. If Ryanair were to have a 235-seat A321neo, they’d need 5 cabin crew.

  17. The biggest problem with the MCAS fiasco was not paying attention to proper process – safety analysis was not updated, no one (to my reading unless I missed something) was looking at the big picture and calling Halt.

    Once the first crash occurred FAA did anticipate more, I read, but between they and Boeing were slow to act. (One trap in calculating probability is not recognizing that the next event could occur tomorrow, not at the average interval calculated.)

    (The process works, I know of one case in an airliner manufacturer where a feature had been installed in the customer’s airplane in production but final testing revealed a safety concern. By mutual agreement the feature was de-activated.)

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