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Ryanair Asks For Lower Boeing Prices  
User currently offlineOlle From Sweden, joined Feb 2007, 315 posts, RR: 0
Posted (5 years 1 month 2 weeks 6 days 7 hours ago) and read 10856 times:

BBC;


Ryanair may halt 'rapid growth'

Michael O'Leary threatens a 'change of strategy' after discussions with Boeing

Irish budget airline Ryanair has said it may stop expanding its business if it does not get a better deal on new aircraft from Boeing.

http://news.bbc.co.uk/2/hi/business/...bc.co.uk/2/hi/business/8337232.stm

 Wink They are bad to Michael O'Leary...

53 replies: All unread, showing first 25:
 
User currently offlineFlyorski From United States of America, joined Dec 2004, 997 posts, RR: 1
Reply 1, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10743 times:

Hmn, Somehow the link does not work. Any chance to repost it? I would be curious as to what it says.

I suppose with Airbus unwilling to talk to Ryanair, and Boeing likely unwilling to lower prices, they may need to go with someone unexpected (C-Series?). I doubt anyone really wants to sell MOL aircraft at his prices.



"None are more hopelessly enslaved, than those who falsly believe they are free" -Goethe
User currently offlineLightsaber From United States of America, joined Jan 2005, 13543 posts, RR: 100
Reply 2, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10719 times:
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Quoting Olle (Thread starter):
Irish budget airline Ryanair has said it may stop expanding its business if it does not get a better deal on new aircraft from Boeing.

Bad to MOL? I seem to recall him bragging about getting the 738's at prices that involved a rather crude experession of what was done to Boeing... ("Rape" being the verb.)

Your link didn't work for me, please try this one if anyone else has issues:
http://news.bbc.co.uk/2/hi/business/8337232.stm

Wow, MOL is firing from both barrels!

Quote:
The airline is in talks with Boeing about an order for 200 new aircraft to be delivered between 2013 and 2016.

It is renowned for its hard bargaining with suppliers and its message to the planemaker is clear.

"We won't continue these discussions indefinitely and have signalled to Boeing that if they are not completed before the year end, then Ryanair will end its relationship with Boeing and confirm a series of order deferrals and cancellations," Mr O'Leary said in the results statement.

It is always interesting when FR, QR, and a few others enter negotiations. FR could forego ordering new aircraft. I doubt Airbus would offer them a better deal... so these quotes have me  yawn  Its just business and MOL going for his usual free plubicity (which, he does a very good job of putting FR's name in the press).

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineAmmunition From United Kingdom, joined Feb 2002, 1065 posts, RR: 4
Reply 3, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10716 times:

Looks like another company not willing to 'prostitute' itself (any more) to the demands of Ryanair!


Saint Augustine- 'The world is a book and those who do not travel, read only 1 page'
User currently offlineBrouAviation From Netherlands, joined Jun 2009, 985 posts, RR: 1
Reply 4, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10609 times:



Quoting Olle (Thread starter):

Michael O'Leary threatens a 'change of strategy' after discussions with Boeing

As if they would care. Unless they start aiming for the smaller regional market, they have to order airplanes at Boeing or Airbus. Airbus seems not to eager on that, so I hope Boeing keeps the head cool.

Quoting Lightsaber (Reply 2):


It is always interesting when FR, QR, and a few others enter negotiations. FR could forego ordering new aircraft. I doubt Airbus would offer them a better deal...

Indeed. MOL might shout around Boeing needs him, but he knows he needs Boeing even more. When he introduces any other type, that will take away the advantage of a uniform fleet he currently has.

I'm very curious how Boeing is going to react on this, and even more, on what will happen if they decline to lower their prices. (I'm sure they already did lower their prices, MOL just doesn't seem to be satisfied with that.)



Never ask somebody if he's a pilot. If he is, he will let you know soon enough!
User currently offlineFrmrCAPCADET From United States of America, joined May 2008, 1743 posts, RR: 1
Reply 5, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10595 times:

LOL - why would we expect Ryan to treat their suppliers any better (abuse them any less) than they treat their customers?


Buffet: the airline business...has eaten up capital...like..no other (business)
User currently offlineCloudyapple From Hong Kong, joined Jul 2005, 2454 posts, RR: 10
Reply 6, posted (5 years 1 month 2 weeks 6 days 6 hours ago) and read 10475 times:

Ryanair Posts Half Year Profits With Warnings .... (by Yodobashi Nov 2 2009 in Civil Aviation)


A310/A319/20/21/A332/3/A343/6/A388/B732/5/7/8/B742/S/4/B752/B763/B772/3/W/E145/J41/MD11/83/90
User currently offlineRedFlyer From United States of America, joined Feb 2005, 4376 posts, RR: 28
Reply 7, posted (5 years 1 month 2 weeks 6 days 5 hours ago) and read 10402 times:



Quoting BrouAviation (Reply 4):
Airbus seems not to eager on that

I wouldn't be too sure of that. If there's any way Airbus could sell FR planes then they will no doubt consider it. The problem is probably that Boeing's prices are so low for FR already and MOL has such a big mouth that Airbus has to really be careful with this one.

Quoting BrouAviation (Reply 4):
MOL might shout around Boeing needs him, but he knows he needs Boeing even more. When he introduces any other type, that will take away the advantage of a uniform fleet he currently has.

Unless, of course, Airbus gives pricing that negates any additional cost of operating a dual fleet. It wouldn't be the first time as I recall easyJet swinging to Airbus after being an all-Boeing operator. And with next-gen planes on tap for both Boeing and Airbus for their single-aisle models (2020 timeframe), maybe now is the time for MOL to consider a future fleet upgrade with another supplier.



My other home is a Piper Cherokee 180C
User currently offlineMariner From New Zealand, joined Nov 2001, 25693 posts, RR: 85
Reply 8, posted (5 years 1 month 2 weeks 6 days 5 hours ago) and read 10276 times:
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Quoting Lightsaber (Reply 2):
It is always interesting when FR, QR, and a few others enter negotiations.

 checkmark 

Agreed. I love to watch MOL operate. There are very few CEO's that have the big iron balls and the sheer, tell-it-like-it-is gall of MOL.

I admire his nerve and he makes me laugh.

I imagine he'll get an airplane deal out of it from - someone. It may not be the deal he is gunning for, but it will probably be a better deal than he is being offered now.

And if he really did go to the wall - if he stopped expanding and distributed a big bunch of cash to his shareholders, he'd have those shareholders eating out of the palm of his hand.

What he does after that, I have no idea. But it won't be dull.  Smile

mariner



aeternum nauta
User currently offlineYXXMIKE From Canada, joined Apr 2008, 310 posts, RR: 0
Reply 9, posted (5 years 1 month 2 weeks 6 days 4 hours ago) and read 10135 times:

Could BBD work out a deal with the C Series? An order of 200+ frames might just change the minds of those at Boeing!

User currently offlineOlle From Sweden, joined Feb 2007, 315 posts, RR: 0
Reply 10, posted (5 years 1 month 2 weeks 6 days 4 hours ago) and read 10081 times:

As I remember, Airbus told them to go a very hot place with a smile and nice words a few month ago?

User currently offlineManfredj From United States of America, joined Mar 2007, 1132 posts, RR: 0
Reply 11, posted (5 years 1 month 2 weeks 6 days 4 hours ago) and read 10060 times:

Perhaps if we knew what price Ryanair wanted to purchase their 737's for, it would be easier to decide which party is being ignorant.

What's an acceptable profit margin Boeing is willing to take on a new 737? Is Ryanair asking them to lose money on each unit? If they take only a small profit, is Boeing forced to take that smaller profit with other customers?

I would be willing to work with Ryanair if I were still making a reasonable profit; even if that meant really slashing the prices...we are talking about 200 more airplanes.



757: The last of the best
User currently offlineHywel From Malaysia, joined Apr 2008, 814 posts, RR: 3
Reply 12, posted (5 years 1 month 2 weeks 6 days 4 hours ago) and read 10019 times:

Getting cheap Boeings is not a problem for Ryanair... getting cheap CFM56 engines is their main problem...

User currently offlineLightsaber From United States of America, joined Jan 2005, 13543 posts, RR: 100
Reply 13, posted (5 years 1 month 2 weeks 6 days 4 hours ago) and read 9894 times:
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Quoting YXXMIKE (Reply 9):
Could BBD work out a deal with the C Series? An order of 200+ frames might just change the minds of those at Boeing!

Both Bombardier and Pratt would *love* this order. It would establish the type. However, I do not think FR's business model has them taking that large of a step down in gauge. I also do not see FR being a launch customer.

Quoting Olle (Reply 10):
As I remember, Airbus told them to go a very hot place with a smile and nice words a few month ago?

In business negotiation that is just foreplay. FR started with a *very* agressive bid that airbus was not willing to negotiate up from. Once FR sees the Boeing/GE prices, they might be willing to offer Airbus enough more to get a team to the negotiating table.

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineClickhappy From United States of America, joined Sep 2001, 9664 posts, RR: 68
Reply 14, posted (5 years 1 month 2 weeks 6 days 3 hours ago) and read 9855 times:
AIRLINERS.NET CREW
PHOTO SCREENER

You would think that given the worth of US Dollars Ryanair would already be getting a significant savings.

In 2002 the Euro was worth .9 of a US Dollar. Now it is worth 1.47.

That is a discount of 60% right there.


User currently offlineFca767 From United Kingdom, joined Nov 2006, 1786 posts, RR: 1
Reply 15, posted (5 years 1 month 2 weeks 6 days 3 hours ago) and read 9767 times:



Quoting Lightsaber (Reply 2):
It is always interesting when FR, QR, and a few others enter negotiations. FR could forego ordering new aircraft. I doubt Airbus would offer them a better deal... so these quotes have me yawn Its just business and MOL going for his usual free plubicity (which, he does a very good job of putting FR's name in the press).

Lightsaber

But it does make people like me; not go for them...I'd never fly on them...ok when it's £5 I would but they are losing money from me....But! If it was £35 on Ryanair and £55 on EasyJet, I would choose EasyJet all the time, or another airline


User currently offlineLightsaber From United States of America, joined Jan 2005, 13543 posts, RR: 100
Reply 16, posted (5 years 1 month 2 weeks 6 days 3 hours ago) and read 9722 times:
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Quoting Fca767 (Reply 15):
But it does make people like me;

First rule of business school "You are not the typical customer."

I'm not sure why anyone wouldn't fly FR due to their aircraft purchasing negotiation? When I buy an automobile, I find the price online and I bargain at a few dealers. The difference with MOL is he walks into the showroom and SHOUTS how bad a deal the first offer really is! The difference is, he is buying 200+. As I noted before, he has a job of publicising FR. He does that *very* well. To paraphrase Charlie Chaplin, "The only thing worse than being in the press is not being in the press." (From an airline's perspective.)

MOL is a spokesmodel who also runs an airline. In the spokesmodel role, he does very well. Love or hate FR, that part has to be appreciated. Other airlines hire actors or use music as their 'spokesmodel.' Its nothing to get excited about...

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlineManfredj From United States of America, joined Mar 2007, 1132 posts, RR: 0
Reply 17, posted (5 years 1 month 2 weeks 6 days 1 hour ago) and read 9192 times:



Quoting Lightsaber (Reply 16):
As I noted before, he has a job of publicising FR. He does that *very* well. To paraphrase Charlie Chaplin, "The only thing worse than being in the press is not being in the press." (From an airline's perspective.)

MOL is a spokesmodel who also runs an airline. In the spokesmodel role, he does very well.

Well said, he's a combination of Virgin flair and Southwest frugality.



757: The last of the best
User currently offlineKimberlyrj From United Kingdom, joined Mar 2008, 385 posts, RR: 1
Reply 18, posted (5 years 1 month 2 weeks 6 days ago) and read 8939 times:



Quoting Ammunition (Reply 3):
Looks like another company not willing to 'prostitute' itself (any more) to the demands of Ryanair!

The words of a BBC programme  Wink

KimberlyRJ


User currently offlineTISTPAA727 From United States of America, joined May 2007, 331 posts, RR: 2
Reply 19, posted (5 years 1 month 2 weeks 6 days ago) and read 8340 times:
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Hypothetically, let's say BBD was on the table and FR went that route. If I were Boeing/Airbus and especially EMB, I'd be happy they won the contract. How long would it take BBD to produce 200 planes, especially if MOL wants them before 2016?

Like I said, just a hypothetical but I could see BBD not really wanting it as it could starve their ability to deliver to other customers (when the 'other' customer order).

Either way, I'm tired of MOL just like Tim Clark, Richard Branson, etc. They all bug me. Excellent PR people, yes but dirty, under-handed tactics.

Just my POV.



Don't sweat the little things.
User currently offlineAirNz From , joined Dec 1969, posts, RR:
Reply 20, posted (5 years 1 month 2 weeks 5 days 23 hours ago) and read 7859 times:



Quoting BrouAviation (Reply 4):
As if they would care.

All I can say is, and particularly in this economic climate plus the financial debacle going on at Boeing, is that if you think Boeing 'don't care' you have a strange viewpoint. They care!

Quoting BrouAviation (Reply 4):
but he knows he needs Boeing even more

Not as much as you seem to imagine, and easily got around. Can also arrange a very handy deal with lessors who I'm sure would be quite happy a such numbers of aircraft as Ryanair deal in. Yes, would be a change of strategy but dispels your theory of "he needs Boeing even more".

Quoting FrmrCAPCADET (Reply 5):
LOL - why would we expect Ryan to treat their suppliers any better (abuse them any less) than they treat their customers?

So, how many times have you flown Ryanair?

Quoting Fca767 (Reply 15):
But it does make people like me; not go for them...I'd never fly on them...ok when it's £5 I would

Interesting that! You declare you'd never fly on them but yet admit you would if it was £5.00. So, it's all about price, so somehow I don't quite believe paying £55 on Easyjet over £35 Ryanair!!


User currently offlineJRadier From Netherlands, joined Sep 2004, 4723 posts, RR: 50
Reply 21, posted (5 years 1 month 2 weeks 5 days 22 hours ago) and read 7736 times:



Quoting TISTPAA727 (Reply 19):
How long would it take BBD to produce 200 planes, especially if MOL wants them before 2016?

Well, about 6 years?! (beginning 2010 to end of 2015)  Wink



For once you have tasted flight you will walk the earth with your eyes turned skywards, for there you have been and ther
User currently offlineAtlanta From United States of America, joined Jun 2008, 473 posts, RR: 1
Reply 22, posted (5 years 1 month 2 weeks 5 days 22 hours ago) and read 7640 times:

I really hope Boeing sticks to its guns on this one and makes MOL pay the price that all other customers pay. Its only fair...  old 

Atlanta



Welcome To The New Delta- The World's Largest Airline
User currently offlineAmmunition From United Kingdom, joined Feb 2002, 1065 posts, RR: 4
Reply 23, posted (5 years 1 month 2 weeks 5 days 20 hours ago) and read 7125 times:



Quoting Kimberlyrj (Reply 18):
The words of a BBC programme Wink

Really? I was referring to the post-MAN pullout drama, maybe the sentence should read 'The wise words of Amo found on an Airliners.net forum'  Wink with the appropriate sourcing from the BBC of course. Big grin

Just out of interest, what programme was it?

This is quite similar to the proposed QR order which was based on performance improvement, i.e. it is a touch messy, and arguably, needlessly in the public arena, but this is MOL.

They could buy a rival and continue expansion (for the sake of it) in the medium term, although it wont be ideal, are there any suitable candidates out there?

Maybe its the loss in potential revenue from the sale of (relatively new) aircraft that is worrying MOL the most?

There is no denying that MOL has goofed this one up, with signs of a recovery from the global recession, the low point may have come and gone, and arguably that would have been the best point at which to negotiate a deal, now he is running around like a headless chicken trying to force a deal. Bad timing once again? (fuel hedging).



Saint Augustine- 'The world is a book and those who do not travel, read only 1 page'
User currently offlineRetrolivery From United States of America, joined Nov 2006, 205 posts, RR: 0
Reply 24, posted (5 years 1 month 2 weeks 5 days 16 hours ago) and read 6359 times:

Seriously, STFU MOL.

Crude as it may sound, Airbus and Boeing really should just cut him off entirely and watch him buckle down prostrate into the simpering infant he really is.

Anyone who has built an empire, nay, made sport out of making air travel as unpleasant, complicated, and utilitarian as possible is an enemy in my book.

The fact that he has capitalized from it makes it even worse.



A3, AA, AC, AI, AK, AM, AP, AZ, B6, BA, CO, DL, EK, EY, FL, FI, FR, KL, KM, LH, MA, MH, MS, OA, OK, OS, SR, TA, TG, U2,
25 FrmrCAPCADET : There are a large number of things I have decided not to try on basis of reputation: In the case of Ryan, their own statements and policies. Cyanide,
26 Post contains links and images Luv2cattlecall : Here's an illustration of that: {Sigh}.. it's not "abuse" when it's voluntary trade. It's not like O'Leary is holding Albaugh's dog hostage or someth
27 Brilondon : I don't think that Boeing would really cow tow to this guy. FR has a fleet of 737's and has all the equipment and support services for the 737. If the
28 UALWN : If MOL stopped expanding, he would soon be left without any cash ti distribute to his shareholders. Ryanair's business model requires constant expans
29 Post contains images N14AZ : I hope the same. MOL, if you want to buy cheap airplanes why don't you take one of those here Kind of back to the roots and the colour scheme is almo
30 Planesarecool : Who cares? There are 60-odd million other passengers happy to take your seat. So you don't like the fact that more people have the opportunity to fly
31 Vfw614 : Maybe wisdom has come upon Airbus and Boeing and they feel that they need to close ranks to fight back unreasonable demands by those few very large LC
32 Mariner : I'm aware of that and so is he. As I also said in that post - the bit you missed out: I wouldn't try to predict what a man with a mind as inventive a
33 N14AZ : That's true. But as they say ""As ye sow, so shall ye reap"
34 Burkhard : .. and the reason Airbus cannot go that far down, and Boeing knows that. That is a thinking I often find with Americans, that it is a profit to damag
35 BERFlyer : No, when FR was trying to talk to Airbus their regional sales manager just gave them the standard rack price list and told them "you might order as m
36 Glom : I was going to rag on Ryanair, but that picture has sufficiently amused me. I will say though that while Ryanair may be useful in certain situations,
37 Glom : Hang on! Hang on! Hang on! What's all this then? According to Ryanair's own website, they charge €5 to check in online. Given that you need to do th
38 Jamesontheroad : This has been discussed before. The £5 online checkin fee does not apply to sale fares. Therefore it is technically an optional charge.
39 BrouAviation : I'm glad that's not how things are. Boeing and Airbus may be stiff competitors, they respect each other and their products and both companies I'm sur
40 Al2637 : It is, on the flight results page. Can you give an example of where they don't show it? As with all airlines they advertise their lowest fare, e.g.
41 Kappel : This does not matter that much as Airbus also prices their aircraft in USD and as I understand, the biggest chunk of the payment is made on delivery.
42 Jamesontheroad : Ryanair only advertise sale fares. The online checkin fee is never included in these fares. Therefore it is avoidable on the advertised fares, but no
43 BrouAviation : I didn't say they don't show it, I just reacted on the statement of the previous poster that it technically was an optional charge.
44 SSTsomeday : The deal he got post 9/11 reflected a very depressed and shocked airline sector at that time. I suspect that Boeing made a great deal for Ryanair in
45 JayinKitsap : I suspect Boeing is reminded with each delivery to MOL what a great deal they gave him before. It is difficult to truly take a loss on each unit and m
46 MogandoCI : yea, a loss in each unit doesn't make the whole sale profitable, unless u're trying to make up the difference via 10 years worth of parts and mainten
47 Planemaker : I concur with your post as there is no way that BBD would be in a position to deliver as the larger CSeires will not even fly before 2014-15 and, as
48 Mariner : There was rather more to it than that. Back in the late 1990's, Boeing had a policy of not giving a break to what were seen as the "upstart" LCC's. T
49 FrmrCAPCADET : Uncalled for. I have no objections to Ryan doing what they want to do, and for those who like what they are doing to fly with them. If I lived in Eur
50 Stitch : Well all these orders have escalation clauses written in to them. We're approaching five years on so that ~USD29 million a frame price on his first de
51 SSTsomeday : Interesting! Off topic but - me neither. I HAVE flown them, and we were left to stifle in a closed lounge on a summer day with no staff in place, no
52 PH-BFA : This time Boeing is not going to 'give away' their 737's to FR, as the situation is completely different compared to 2005: 1. By offering again a larg
53 Post contains links Yeogeo : The New York Times has an article on this subject today, "Ryanair Signals Its Rapid Expansion May Be Over". http://www.nytimes.com/2009/11/03/bu...glo
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