* Order of at least 150 737s could be signed within weeks
* Most or all planes likely current generation 737s -sources
* Ryanair says order not expected until later in the year
By Tim Hepher and Conor Humphries
DUBLIN, Jan 23 (Reuters) – Low-cost Irish airline Ryanair
is closing in on a deal to buy at least 150 Boeing
737 passenger jets and the contract could be signed
within weeks, industry sources said.
Ryanair said in a statement that a deal was unlikely to be
signed until later in the year at the earliest.
Most or all of the planes would likely be current generation
737s rather than the upcoming Max upgrade, which would allow
Ryanair to secure a significant discount on the list price, two
of the sources said on Wednesday.
A large order of current generation 737s would help Boeing
ensure no fall in production as customers hold out for the Max,
scheduled to enter service in 2017. At current list prices, an
order for 150 Boeing 737-800s would cost about $13 billion.
Ryanair, Europe’s top budget airline, has been in
discussions with Boeing for years about a large order which it
needs to help achieve its plan of increasing it annual capacity
to 120 million passengers in 2022 from around 80 million today.
But spokesman Stephen McNamara said a deal was not imminent.
“None is expected until perhaps the end of calendar 2013 or
early 2014, at the earliest,” he said in a statement.
Ryanair has exclusively used Boeing planes in the past and
last year O’Leary said it would likely order a combination of
current generation Boeing 737 and its upgrade, the 737 Max.
The current generation is less fuel efficient, but that
would have less of an impact on Ryanair’s relatively short route
lengths.
As Ryanair does not have a relationship with Airbus it
cannot use the strategy used by other airlines to play them off
against each other.
Instead it has in the past tried to time significant orders
for holes in Boeing’s production schedule.
O’Leary in 2002 secured an order of 125 planes in 2002 at
discounts rumoured to be 40 to 50 percent off list as Boeing
struggled with a downturn.
The low aircraft cost has underpinned Ryanair’s rapid
seven-fold rise in passenger numbers in the decade since.
But talks over a 200-plane order broke down in 2009 at the
last minute and O’Leary has been trying to secure a favourable
deal with Boeing ever since.
A deal would be a boost for Boeing as it seeks to sort out
problems with its new 787 airliner, which has triggered a wave
of negative publicity.
Aircraft manufacturers often sell planes at lower prices
immediately before a new generation of jet is released. A Boeing
executive declined comment on a possible Ryanair order.
Ryanair chief financial officer Howard Millar told a
conference on Wednesday the airline was in talks about the
purchase of up to 200 Boeing aircraft, according to a delegate.
The conference was closed to the media.
