Ryanair Closing Bases Due to Boeing 737 MAX Crisis
Ryanair said Tuesday it will close some of its bases because of problems with Boeing's crisis-hit 737 MAX jet, which has been grounded after two fatal accidents.
The Irish no-frills airline said in a statement that it expected to take delivery of just 30 Boeing 737 MAX 200 jets by the end of May 2020, instead of the 58 that it originally expected for its summer schedule.
The jets are a variant of the MAX aircraft and therefore need certification from the US Federal Aviation Administration (FAA) and the European Union Aviation Safety Agency (EASA), it added.
"This shortfall in aircraft deliveries will necessitate some base cuts and closures for summer 2020, but also for the winter 2019 schedule," Chief Executive Michael O'Leary said in the statement.
"We are starting a series of discussions with our airports to determine which of Ryanair's underperforming or loss making bases should suffer these short term cuts and/or closures from November 2019," O'Leary noted.
"We will also be consulting with our people and our unions in planning and implementing these base cuts and closures, which are directly caused by the B737 MAX delivery delays to the B737 MAX program."
The Dublin-based group did not however specify which bases were at risk, nor did it signal any job cuts.
- Forecasts slashed -
As a result, however, Ryanair also slashed its summer growth rate from seven percent to three percent.
And it cut its full-year 2020/2021 passenger traffic growth forecast to 157 million, compared with prior guidance of 162 million.
Ryanair now hopes to take delivery of its first MAX 200 jet some time between January and February 2020.
Boeing's global fleet of 737 MAX planes has been grounded since mid-March following the second of two catastrophic accidents in Indonesia and Ethiopia which killed 346 people.
The US aviation giant has developed a software upgrade to the 737 MAX after problems with a flight handling system were tied to the Lion Air and Ethiopian Airlines crashes. But the jet has still not been cleared by regulators to resume flying.
Ryanair, which operates a fleet of more than 450 Boeing 737-800 series aircraft, on Tuesday stressed its commitment to the MAX plane.
The group currently has orders of up to 210 new Boeing 737 jets, including 135 MAX 200s and with options for 75 more MAX 200s.
- 'Remains committed' -
“Ryanair remains committed to the B737 MAX aircraft, and now expects that it will return to flying service before the end of 2019, however the exact date of this return remains uncertain," O'Leary said on Tuesday.
"Boeing is hoping that a certification package will be submitted to regulators by September with a return to service shortly thereafter.
"We believe it would be prudent to plan for that date to slip by some months, possibly as late as December.
He added: "Ryanair expects that the MAX200 will be approved for flight services within two months of the MAX return to service."
Ryanair is meanwhile overhauling its activities into distinct operations, mirroring a set-up by British Airways owner IAG.
The group is targeting 200 million passengers per year by 2024.