Delta777Jet
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Posts: 1400
Joined: Tue Jun 13, 2000 6:19 am

Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 9:04 pm

We recently saw announcements of Ryanair for base closures and route cuts for flights in the coming winter season. For the current S19 season they seem, even without Max, to have sufficient aircraft.

Could the cutbacks in the winter be a massive sale off on their 737-800s ? I could imagine values for 737-800 must have gone up due to a/c shortness and it would be a good moment to sell as many possible and then await Max deliveries for the S20 season and benefit again from Boeing's compensation discounts on future deliveries ?
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Q
Posts: 912
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 9:13 pm

No, they were not selling planes. LOL! They will get more routes in winter or spring.

Q
 
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Aisak
Posts: 841
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 9:30 pm

Ryanair is always disposing of frames as new ones come in. Part of their business plan to save the money and the down time of going through complex maintenance checks. But this time due to the MAX grounding no new planes will come to replace the ones departing the fleet.
 
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adamblang
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 9:53 pm

Delta777Jet wrote:
I could imagine values for 737-800 must have gone up due to a/c shortness and it would be a good moment to sell as many possible and then await Max deliveries for the S20 season and benefit again from Boeing's compensation discounts on future deliveries ?

It's amazing to me that people think the time to market, negotiate, sell, exit prep, transfer, re-register, re-configure, regulatory check, and induct an an airplane is some quick thing. It'll take, what, 4 months best case to complete a transfer from one airline to another? So that the newly acquired plane can fly around for three months before 737 MAXes come back online?
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MIflyer12
Posts: 5429
Joined: Mon Feb 18, 2013 11:58 pm

Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 9:58 pm

Delta777Jet wrote:

Could the cutbacks in the winter be a massive sale off on their 737-800s ?


What, in your mind, constitutes a massive sell-off. Do the announced route terminations - given typical frame utilization - support such a sell-off?
 
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BasilFawlty
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Joined: Fri Jun 05, 2009 11:23 am

Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 10:01 pm

Aisak wrote:
Ryanair is always disposing of frames as new ones come in. Part of their business plan to save the money and the down time of going through complex maintenance checks.

Actually they’re slowly moving away from this strategy. They’ve doubled the number of heavy maintenance facilities last year, with new locations at Seville and Wroclaw, besides the existing ones in Kaunas and Prestwick.
'Every year donkeys and mules kill more people than plane crashes'
 
Waterbomber2
Posts: 383
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 10:15 pm

Delta777Jet wrote:
We recently saw announcements of Ryanair for base closures and route cuts for flights in the coming winter season. For the current S19 season they seem, even without Max, to have sufficient aircraft.

Could the cutbacks in the winter be a massive sale off on their 737-800s ? I could imagine values for 737-800 must have gone up due to a/c shortness and it would be a good moment to sell as many possible and then await Max deliveries for the S20 season and benefit again from Boeing's compensation discounts on future deliveries ?


It is plausible and it is also plausible that they will use this opportunity to downsize.
They have lost focus and have chased the quick buck by trying out primary airports, new HQ, high seasonal fares, etc...
Reality is settling in now, with Wizzair and Eurowings hungry for market share, new competition growing at their former LCC strongholds, unions swaying with their flags, costs going through the roof.

Ryanair needs to go back to basics. The free seating, the free cabin bag, the aggressive fares, the LCC bases, brand new aircraft to keep costs low and predictable, the special marketing agreements with local authorities, etc...
 
leghorn
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 10:33 pm

They are getting ready to sell their older 737-800 airframes at elevated prices while Max is grounded and lining up an order of even more 737 Max planes when the grounding is over.
They have admitted to getting rid of 30 airframes in coming months(while announcing they are overstaffed). They'll get rid of more than that if everything falls in to place.
The market for 737-800 planes is very bouyant not just due to the grounding but also because Chinese Freight companies are entering the market and refitting old airframes(mentioned in a results Q&A session about two quarters ago).

IAG know this which is why they are asking for earlier 737 Max cancellation slots asa blocking strategy for the MoU that hasn't committed them to buying any planes yet.
 
DDR
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Re: Ryanair cutting routes , selling planes ?

Tue Aug 13, 2019 10:40 pm

Aisak wrote:
Ryanair is always disposing of frames as new ones come in. Part of their business plan to save the money and the down time of going through complex maintenance checks. But this time due to the MAX grounding no new planes will come to replace the ones departing the fleet.


Very good analysis Aisak. I believe this is what is happening now. Once the Max aircraft start coming again, they will add more flights as usual. The only downside for crew is that Ryanair will have too many crew for some months.
 
PlymSpotter
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Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 10:56 am

With the rebound in lease rates for B737NGs, expediting the sale of aircraft at the end of S19 could be a very shrewd move.

Yields are lower during the winter season, meaning they could make more money by selling an aircraft now than keeping it to the planned term (say, Apr. 2020) and flying pax.

Of course this relies on actually receiving more new aircraft at some point.
...love is just a camouflage for what resembles rage again...
 
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Embajador3
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Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 11:02 am

They are not cutting aircraft, they are just transferring them to Buzz Air and Malta Air.
Flying Together
 
leghorn
Posts: 869
Joined: Sun Jan 22, 2017 9:13 am

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 11:07 am

Embajador3 wrote:
They are not cutting aircraft, they are just transferring them to Buzz Air and Malta Air.

They are cutting aircraft. At least 30 that they have admitted to.

http://www.finanzas.com/noticias/empres ... 22845.html?

El sindicato indica que las razones argumentadas por Ryanair es que el próximo año tendrá 30 aviones menos y ha decidido moverlos de las bases menos rentables y recolocarlos en otros países y aeropuertos con planes de crecimiento.
 
B777LRF
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Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 11:44 am

Ryanair always, always reduce massively during the winter season, to the tune of around 15% compared to high season. Aircraft are either parked or sold off, crew are on reduced hours or laid off, and it's all business as usual.

The lack of new aircraft coming in, in this case Max's, will start becoming a real bother as the S20 season kicks in. Then again, it's somewhat miraculous they've managed to deceive the burgeoning unionisation of the company, and claw their way through S19 without labour disruptions. Can't keep that up forever though, and the UK pilots have already announced strikes.

Big picture is, O'Leary is using the usual winter wind down and potential lack of aircraft for the S20 season, to bully his staff into submission. As has always been his tactic, albeit the Max derived complication is a new and added 'bonus'.
Signature. You just read one.
 
leghorn
Posts: 869
Joined: Sun Jan 22, 2017 9:13 am

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 12:12 pm

No, this time it is different. They are willing to forego revenue in 2020 and 2021 if they can get a good enough price for their old planes so that they can place an order for more cheap planes for delivery in coming years.
They need to get their ducks in a row in that they'll need to get cancelled production spots. They'll need to trim the routes so that less productive planes in outlying locations like the Canary Islands are moved toward the centre of their network like DUB, Stansted, Belguim, Italy and Germany where those planes will be worked like never before.
When you can get more for the asset by selling it than working it then sell the asset.
The replacements when they come will widen their competitive advantage which had narrowed in recent years.
 
alm1
Posts: 59
Joined: Wed Oct 29, 2008 9:54 pm

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 12:32 pm

Also the difference is that staff has a lot less options now. I don't think there is an airline that is hiring 737 pilots in Europe at the moment. With Norwegian downsizing there should be pilot surplus now.
 
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Aisak
Posts: 841
Joined: Thu Aug 11, 2005 10:56 pm

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 12:45 pm

Embajador3 wrote:
They are not cutting aircraft, they are just transferring them to Buzz Air and Malta Air.
And to Ryanair UK (just one G-RUKA but more will follow post October). They could increase the Airbus fleet of Lauda Air, but it seems they have put that airline in survival "as is" mode...
 
bennett123
Posts: 8866
Joined: Sun Aug 15, 2004 12:49 am

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 5:06 pm

Sounds like the pilots will just have to sit at home until FR start hiring again.

Good timing from MOL’s point of view.
 
A380MSN004
Posts: 509
Joined: Sat Jun 03, 2017 9:07 am

Re: Ryanair cutting routes , selling planes ?

Wed Aug 14, 2019 8:03 pm

alm1 wrote:
Also the difference is that staff has a lot less options now. I don't think there is an airline that is hiring 737 pilots in Europe at the moment. With Norwegian downsizing there should be pilot surplus now.


Sounds the MAX grounding is about to solve temporary the Pilot shortage

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