Ryanair said it will continue to sell tickets at discounted rates this winter to boost traffic. That and increasing fuel prices means it expects to report losses of between €100 million and €200 million ($116 -$231 million) in its current financial year.
The low-cost carrier also had some strong words for Boeing about negotiations for an order for additional 737 MAX aircraft, with chief executive Michael O’Leary calling the manufacturer’s attitude delusional.
Ryanair, which has ordered 210 of the 737-8200 variant, ended talks with Boeing over a potential order for 737 MAX 10 aircraft on September 6, 2021.
“Boeing out of the blue sought a significant substantial double-digit price increase. I don’t understand the strategy. We think Boeing’s approach is delusionary,” O’Leary said on November 1.
O’Leary highlighted that Ryanair was currently Boeing’s only major customer in Europe, with Norwegian having cut its orders, Jet2 switching to Airbus and IAG inviting both Airbus and Boeing to tender for a short-haul order.
“They are looking for a price increase at a time when prices should be falling if Boeing is going to recover its production,” O’Leary added.
Ryanair expects to take delivery of 65 of the aircraft before summer 2022. There have been fears that passengers might feel uncomfortable flying on the MAX but O’Leary said Ryanair was offering passengers the chance to switch to a later flight and so far no one had wanted to get off the aircraft.
O’Leary made the comments in a video statement after Ryanair reported financial results for the six months to September 30, 2021.
The airline group made a first-half net loss of €48 million ($56 million), smaller than the €411 million ($476 million) it reported for the same period a year ago, thanks to rising bookings across Europe during the peak summer travel period.
While Ryanair said it has seen a “surge” in bookings for the October school holidays, Christmas, and Easter 2022, the situation remains tough outside of the peak periods.
“We have very strong forward bookings for peak periods, but the rest of November, early December, back end of January are weak and will require further price stimulation,” Michael O’Leary said in the video statement.
Ryanair said it would therefore be sticking with its strategy to sacrifice higher ticket prices in favour of filling its planes. The airline had previously expected between a small loss to breakeven for its 2022 fiscal year, but now says a loss of €100-200 million is likely.
It expects it will carry just over 100 million passengers in the twelve months to March 31, 2022, should it continue with its current recovery rate and in the absence of further COVID-19 disruptions. That’s a slight improvement on a previous prediction for 90 million to 100 million passengers. Load factors will recover to over 90% for summer 2022, O’Leary forecast.