Ryanair issues ultimatum to Boeing

Passengers board a Ryanair Boeing.

TEXT OF STORY

Bill Radke: Europe's largest no-frills airline -- Ryanair -- reports says its quarterly profit jumped 35 percent. Mostly thanks to lower fuel prices. But this current quarter could be less rosy. Ryanair says it's cutting ticket prices by as much as 20 percent this winter. And it will cut ties with Boeing -- unless the carrier gets a better deal on new planes. Stephen Beard has more from London


Stephen Beard: Ryanair is one of Boeing's best customers. The carrier's entire fleet was supplied by the U.S. plane maker. And it's currently negotiating to buy 200 aircraft. But Ryanair today issued an ultimatum: If Boeing doesn't cut its prices, the airline will buy no more planes from Boeing. And it will stop expanding its own business and hand cash back to its shareholders instead.

Mark Pilling is editor of Airline Business Magazine. He says Ryanair's threat is typically aggressive, but not entirely credible.

Mark Pilling: I can't see an airline that's based its whole strategy over the last 15-plus years on growing at a pretty healthy, double-digit lick, to then reverse that. That sounds quite incredible to me.

He says that Boeing has a lengthy order book with other carriers around the world. And is resisting Ryanair's demands. But the plane maker will not want to lose such a good customer, least of all to its old rival Airbus.

In London, this is Stephen Beard for Marketplace.

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

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