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WayexTDI
Posts: 2459
Joined: Fri Sep 21, 2018 4:38 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 1:48 pm

VV wrote:
marcelh wrote:
VV wrote:

That's interesting.

It may mean Ryanair is not going to grow any more and/or it is not going to replace any retired aircraft.

Unless they ordered Airbus aircraft? But some people here said that Airbus is not going to do business with Ryanair.

So what's the truth?
Something is not right here.


Airbus wants to do business with Ryanair, but Ryanair don’t want to pay the price Airbus wants.


And now Ryanair does not want to pay the price Boeing wants.

What are they going to do now??????

Honestly, it's Ryanair's problem. It's a free market where the law of demand and offer is king.
 
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Revelation
Posts: 26723
Joined: Wed Feb 09, 2005 9:37 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 2:15 pm

Francoflier wrote:
There is no indication that Boeing is unrealistic with prices. In fact, when it comes to the MAX, I'm pretty sure they are quite competitive and motivated to sell. My opinion here is that FR was trying to get Boeing to sell at a loss, or something so ridiculously low that there was simply no point in Boeing even manufacturing these frames.

It's standard practice for FR to walk in a negotiation room like they're the only one in the World buying airplanes, but these days I just can't understand their strategy...
Orders for 100+ narrowbodies are not uncommon anymore, and as much as Boeing would like to sell the MAX10, they might just as well sell any other variant of the same plane instead, which will be produced on the same line, at a higher profit per frame. On the other side, Airbus has no incentive to lower prices at all on the NEO, much less the 321, and they seem to have little patience for Ryanair at the moment.

What's FR's leverage here?

Great post. Boeing moved a lot of planes in the post-MCAS funk. WN, AS, UA and even FR itself made large orders. That was when MOL had leverage. Now with Boeing being at decent levels of production (see our Production thread for details) and decent financial stability he doesn't have leverage. The rapist has been unable to complete the act once more, and the frustration is now on display for the world to see. Thing is, no one pities a rapist.
 
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scbriml
Posts: 20122
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 4:28 pm

majano wrote:
scbriml wrote:
seahawk wrote:
1+2 + toying with the C919. If the C919 gets a EASA certification, the toying could become serious.


A program that was launched in 2008 and in 13 years has produced SIX uncertified frames? Oh, and is also not big enough for Ryanair?

Thanks, I needed a laugh. :rotfl:

I am sure you will find the MS-21 more amusing as a proposition then?


You're right, it's nearly as funny.

Or they could go for Sukhoi Superjets? :lol:
 
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scbriml
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Joined: Wed Jul 02, 2003 10:37 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 4:34 pm

Galwayman wrote:
Boeing share price still down after the announcement . They’re going to have to do something to keep FR happy …


The whole stock market is down, Ryanair's power is amazing! :sarcastic:

Boeing doesn't have to do anything keep Ryanair "happy". What is Ryanair going to do? O'Leary has painted himself into a corner, it's pretty amusing to see.
 
Daysleeper
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Joined: Sun Dec 20, 2009 3:33 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 4:46 pm

After a lot more thought I am starting to question the whole “MOL will never order Airbus” mentality. Which I have been very much a part of, I hasten to add. I know, I KNOW! But hear me out; MOL doesn’t share our own biases (and yes we all have them) he wants to make money and doesn’t seem to care who he upsets by doing it – its all about the end result.

So how can he ‘win’ here? He orders Airbus. Either the 321LR or 321XLR, just a small amount, enough to offer low fair trans-Atlantic services from secondary airports where his only competition is likely to be legacy carriers currently operating old 757 stock. I think there is a real opportunity for Ryanair here, after all there is going to be very little difference in terms of passenger comfort between Y in a legacy narrow body and whatever Ryanair would offer; it would come down to ticket price, and that’s where they will shine.

I know there are problems with this idea, but I don’t think any of them are unsolvable. Fleet commonality for instance; this to me is a none issue; international fleets are always going to be different to domestic, with differing maintenance requirements for ETOPS, different pilot pools, and perhaps even a slightly better hard product. I don’t see how this would be any easier or cheaper should there actually be a Boeing alternative to the XLR for MOL to order.

Which brings us to the biggest potential problem; cost. 321’s aren’t going to be cheap, and I don’t see Airbus going out of their way to make them so just for MOL. But these would be operating on new routes with the potential to be VERY lucrative. Think how much they are going to make on inflight services, or should you actually fly with luggage and require a checked bag.

And finally, we have Boeing. Imagine the havoc MOL could reap on their sales team should he actually secure an Airbus order. Even if he has to over pay on a sub fleet of trans-Atlantic XLR’s the discounts he would be able to get on a much larger Max10 order for domestic use would likely make up for it.

Vicenza wrote:
Out of curiosity, if you are a passenger in any mode of transport, of what concern is it to you what the driver is paid? Are you seriously suggesting that skill, performance and even integrity is governed by what someone earns? When you mention acceptable....what if I may ask, and to whom?.


To answer your curiosity.; Yes. Yes I very much pay attention to how the people I routinely entrust my life too are treated. And no, I do not think that pay or conditions has any real relation to skill but it certainly does have an impact on performance. Distracted, tired and over worked flight crews have caused many fatal aviation accidents. Personally I am happy to pay a little more to know that the flight crew aren’t distracted by things such as affording rent or difficulty getting a mortgage due to being on “zero hour contact”.

SIVB wrote:
OTOH, we can all discuss if Ryanair is a garbage product, or mistreats employees, but I won’t accept certain comments that are simply not true. Full disclosure, I am a Ryanair captain, and on any given day I load whatever extra fuel I require for the flight, do a go-around whenever I feel is necessary, or delay a flight to complete a briefing or checklist, and I have never received an email or call questioning my decision. If any, the input we receive from management and training is clear: safety first! Captain’s total discretion to load extra fuel, no blame policy for go arounds, no rush to complete procedures of checklist. With regards to rest, the roster is 5 days on, 4 days off; on blocks alternate between early and late duties, but never within a block. These policies regarding safety and rest are much better than in my previous “legacy” airline.

Everyone is entitled to share their opinion, especially in an Internet forum, but please try to keep it fair and don’t dress opinions as facts.


First of all please don’t take anything I have said about Ryanair and their garbage product as a personal reflection upon yourself or your colleagues. But I stand by what I said. There was a memo leaked some years ago from Mol to his staff regarding minimum fuel requirements and how much more money he could make if they perhaps didn’t uplift as much. It was a work of art, really. At the time, various pilots unions and groups jumped on it stating it was illegal because its ultimately the captains responsibility to dictate the fuel requirements for a given flight. But if you read it carefully he never actually “says” that it is no longer the captains prerogative to dictate what fuel is required, he merely points out how much money carrying extra fuel is costing his company and how your career prospects are directly linked to how much money he and his company can make. And it worked, with the addition of random checks on crews to ensure they were operating the aircraft as “efficiently” as is possible there were a flurry of mayday low fuel incidents involving Ryanair.

I would love to link you to the memo but I am genuinely having trouble finding it. Searching for Mol legal treats and staff disputes brings up hundreds of separate incidents. What I do remember though is that there was a documentary made in the he UK by Channel 4 called “secrets of the cockpit” which is available to UK viewers on the All4 app. I’m not sure where to find it as a direct link outside of the UK, but for context here are some highlights from it and the resulting media attention;

Ryanair pilots 'bullied into silence over safety': Two-thirds say they are not comfortable raising fears with their bosses

90% say airline doesn't have 'open and transparent safety culture'

Three-quarters of Ryanair pilots said to be on zero-hours contracts and must pay for all their expenses, including uniforms and transport



There were however many threads here discussing it which I can link too (I have not re-read them all, and this is just a selection). This is about the actual program. This is when Ryanairs own pilots were demanding a safety inquiry. And This relates to one of the many lawsuits Mol filed against the media covering it – All of which he lost.

Finally means I’m linking to things relating to Ryanair’s staff then I have to link to Mentour, although he never states who he works for as a 737 training captain I am 99.9% sure it's FR. It’s a shame, as he would be an excellent advertisement for them, I, for one, would have no issues sitting in the back if he was always sitting up front.

Edited to add: Mod's I know I drifted a little off-topic towards the end, but Ryanair's past is kinda relevant to its future. However, if you are going to delete this post could you please message me with a copy of it, so I can start another thread or resurrect and old one. This post took me over an hour, man I need to get a life :)
 
Galwayman
Posts: 1044
Joined: Fri Mar 10, 2017 10:20 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 5:20 pm

scbriml wrote:
Galwayman wrote:
Boeing share price still down after the announcement . They’re going to have to do something to keep FR happy …


The whole stock market is down, Ryanair's power is amazing! :sarcastic:

Boeing doesn't have to do anything keep Ryanair "happy". What is Ryanair going to do? O'Leary has painted himself into a corner, it's pretty amusing to see.


Next Boeing crisis can’t be more than 18 months away - … tick tock
 
VV
Posts: 2352
Joined: Sat Feb 13, 2016 1:03 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 5:43 pm

WayexTDI wrote:
VV wrote:
marcelh wrote:

Airbus wants to do business with Ryanair, but Ryanair don’t want to pay the price Airbus wants.


And now Ryanair does not want to pay the price Boeing wants.

What are they going to do now??????

Honestly, it's Ryanair's problem. It's a free market where the law of demand and offer is king.


It is indeed Ryanair's problem and that's why there is a long thread here. LOL
 
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Revelation
Posts: 26723
Joined: Wed Feb 09, 2005 9:37 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 5:44 pm

Daysleeper wrote:
So how can he ‘win’ here? He orders Airbus. Either the 321LR or 321XLR, just a small amount, enough to offer low fair trans-Atlantic services from secondary airports where his only competition is likely to be legacy carriers currently operating old 757 stock. I think there is a real opportunity for Ryanair here, after all there is going to be very little difference in terms of passenger comfort between Y in a legacy narrow body and whatever Ryanair would offer; it would come down to ticket price, and that’s where they will shine.

I know there are problems with this idea, but I don’t think any of them are unsolvable. Fleet commonality for instance; this to me is a none issue; international fleets are always going to be different to domestic, with differing maintenance requirements for ETOPS, different pilot pools, and perhaps even a slightly better hard product. I don’t see how this would be any easier or cheaper should there actually be a Boeing alternative to the XLR for MOL to order.

Which brings us to the biggest potential problem; cost. 321’s aren’t going to be cheap, and I don’t see Airbus going out of their way to make them so just for MOL. But these would be operating on new routes with the potential to be VERY lucrative. Think how much they are going to make on inflight services, or should you actually fly with luggage and require a checked bag.

And finally, we have Boeing. Imagine the havoc MOL could reap on their sales team should he actually secure an Airbus order. Even if he has to over pay on a sub fleet of trans-Atlantic XLR’s the discounts he would be able to get on a much larger Max10 order for domestic use would likely make up for it.

You seem to make the assumption that FR can enter and sustain TATL business at a profitable level from secondary airports, which is a very unproven idea. Most who have tried have failed. It's even harder in the COVID era. I just went through the hoops needed to get my mother from US to DE and it was an expensive and confusing process, and fraught with risk if either side changes its policies, which is happening all the time. In short, TATL travel is still fraught with risk and for many the reward is not worth the risk.

Adding a new fleet type and performing TATL operations is going to take a huge amount of money up front and is not IMO likely to be profitable. They'd be better off paying Boeing's asking price on MAX10s or just waiting till another economic slowdown forces Boeing into making concessions.

You also seem to be convinced that Boeing will make concessions the instant they see MOL make a deal with Airbus, which IMO is far from a certain thing. The reason they're holding the line on MAX10 pricing is they do not want to give future MAX10 customers the leverage of a low-ball FR order to drive down pricing across the board. There's a lot more at stake for Boeing than just FR's future MAX10 order.
 
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seahawk
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 5:51 pm

scbriml wrote:
seahawk wrote:
1+2 + toying with the C919. If the C919 gets a EASA certification, the toying could become serious.


A program that was launched in 2008 and in 13 years has produced SIX uncertified frames? Oh, and is also not big enough for Ryanair?

Thanks, I needed a laugh. :rotfl:


You asked what he will do, not what he should do. There was no real argument for signing the MoU in 2011 and the C919 did not look better in 2020 than it does today, yet O’Leary still described FR as committed to the C919.

https://simpleflying.com/ryanair-comac-commitment/

https://aviator.aero/press_releases/5062

Yes, it is delusional to believe that they get the C919 EASA certified any time soon, but not more delusional than believing in 2011 that they would have a first flight in 2014.
 
Daysleeper
Posts: 631
Joined: Sun Dec 20, 2009 3:33 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 6:23 pm

Revelation wrote:
You seem to make the assumption that FR can enter and sustain TATL business at a profitable level from secondary airports, which is a very unproven idea. Most who have tried have failed. It's even harder in the COVID era. I just went through the hoops needed to get my mother from US to DE and it was an expensive and confusing process, and fraught with risk if either side changes its policies, which is happening all the time. In short, TATL travel is still fraught with risk and for many the reward is not worth the risk.

Adding a new fleet type and performing TATL operations is going to take a huge amount of money up front and is not IMO likely to be profitable. They'd be better off paying Boeing's asking price on MAX10s or just waiting till another economic slowdown forces Boeing into making concessions.

Many of the legacy’s offer TATL flights from Manchester, Leeds-Bradford, Birmingham, Edinburgh etc. And I know I am taking a little bit of a liberty in listing a large UK city as a secondary airport but in the UK anything out side of London is “secondary”. And having personally flown on many a Delta757 from LBA or MAN into EWR I can attest to how busy the flights always were. This was of course pre-covid and I am not sure what the current demand would be, but I think any order is going to be dependant on decent post-covid recovery.

And yeah I agree that there would definitely be a risk into entering the TATL market, but I also think there would be reward. Otherwise why would the legacy’s be operating directs from Leeds? It’s what? 2 hours by rail into London where they have existing widebody services. There has to be a money in it for them. And historically that has been MOL’s speciality, picking off profitable roots offered by legacy’s and under cutting them.

Revelation wrote:
You also seem to be convinced that Boeing will make concessions the instant they see MOL make a deal with Airbus, which IMO is far from a certain thing. The reason they're holding the line on MAX10 pricing is they do not want to give future MAX10 customers the leverage of a low-ball FR order to drive down pricing across the board. There's a lot more at stake for Boeing than just FR's future MAX10 order.


Yup, I have absolutely no doubt that should MOL re-start negotiations for the Max10 with an A321 order in pocket he is going to really tighten the screws on Boeing. And to be fair he would in theory be in a much better position than he is now to do so. Will Boeing relent? don’t know for sure. But if history is any guide then they will.
 
Vicenza
Posts: 393
Joined: Sun Apr 19, 2020 3:21 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 6:56 pm

DarkSnowyNight wrote:
Vicenza wrote:
Name any airline who pays more for aircraft than they have to, and especially when an order is not for just 10 or 20?


I find it very interesting that this site routinely congratulates DL for doing literally the exact same thing as being a tightly run ship. But when it is FR, EK, QR, etc, all of a sudden it is 'dramatic.' FR have no obligation to ensure BCA's profit margins, and I do not get where on earth the idea came from that otherwise could ever somehow be true.


Agree with you entirely, and seemingly one of the myths of a.net that I simply have ever been unable to fathom. It is entirely up to Boeing to choose whatever minimum price they will accept, and under which conditions and/or risk involved. But yet, when seemingly Boeing need a large order, those same members when the agenda suits are the first ones to want and shout for the likes of FR.
 
Vicenza
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 7:04 pm

VictorKilo wrote:

If anything I think the public whining by MOL made things worse. BCA executives are under pressure to make cash, and publicly holding their ground on price is a good way to show that they are concerned about profits and cash flow and not just sales volume.


It is entirely up to MOL how he wishes to do business and, whether 'right' or 'wrong' does not need the approval of anyone on a.net. As I've said before, MOL's actions at any given time are entirely dependent upon the agenda of members.. As per your last sentence, I can't quite decide whether you mean "concerned about profits...." in an ethical, or non-ethical, way.
 
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Revelation
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 7:36 pm

Daysleeper wrote:
Many of the legacy’s offer TATL flights from Manchester, Leeds-Bradford, Birmingham, Edinburgh etc. And I know I am taking a little bit of a liberty in listing a large UK city as a secondary airport but in the UK anything out side of London is “secondary”. And having personally flown on many a Delta757 from LBA or MAN into EWR I can attest to how busy the flights always were. This was of course pre-covid and I am not sure what the current demand would be, but I think any order is going to be dependant on decent post-covid recovery.

And yeah I agree that there would definitely be a risk into entering the TATL market, but I also think there would be reward. Otherwise why would the legacy’s be operating directs from Leeds? It’s what? 2 hours by rail into London where they have existing widebody services. There has to be a money in it for them. And historically that has been MOL’s speciality, picking off profitable roots offered by legacy’s and under cutting them.

Busy is one thing, profitable is another. If you want to be busy, just offer fares of 1 GBP/USD/EUR, the plane will fill up quick.

DL is flying from secondary UK airport to places like BOS and NYC. In those places they can also book connecting flights to make more money. The 757 has a bit of premium seating so they can make a good markup. The operations in BOS and NYC are already in place and funded by other flights. Adding the UK flights doesn't add much overhead. They already use 757 domestically, using some on TATL routes doesn't add much overhead.

FR would start from scratch. They will find BOS or NYC expensive and hard to get access during desirable flight times. They won't have access to connecting flights, or if they do they will have to partner with someone to get them and that means they get less profit from the connection. No one will pay a premium for a FR flight. They will have little brand recognition on this side of the pond.

FR could try to fly secondary city to secondary city, but those who tried this recently (Norwegian, WizzAir) struggled. You can get a good number of people from Leeds to fly to BOS or NYC but not to Hartford.

Daysleeper wrote:
Yup, I have absolutely no doubt that should MOL re-start negotiations for the Max10 with an A321 order in pocket he is going to really tighten the screws on Boeing. And to be fair he would in theory be in a much better position than he is now to do so. Will Boeing relent? don’t know for sure. But if history is any guide then they will.

There are circumstances where Boeing will relent. The problem for FR is that they just missed the biggest window for such we've ever seen, with Boeing desperate due to both MCAS and COVID. They thought they had leverage, now they have found out that they don't, and they're kicking their toys out of the pram. Their only realistic choices are to pay up or wait. Even FR seems to know it might be years before the right circumstances come together. All we know for sure is FR will claim victory either way.
 
SIVB
Posts: 32
Joined: Thu Jun 13, 2019 7:22 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 7:50 pm

Daysleeper wrote:

SIVB wrote:
OTOH, we can all discuss if Ryanair is a garbage product, or mistreats employees, but I won’t accept certain comments that are simply not true. Full disclosure, I am a Ryanair captain, and on any given day I load whatever extra fuel I require for the flight, do a go-around whenever I feel is necessary, or delay a flight to complete a briefing or checklist, and I have never received an email or call questioning my decision. If any, the input we receive from management and training is clear: safety first! Captain’s total discretion to load extra fuel, no blame policy for go arounds, no rush to complete procedures of checklist. With regards to rest, the roster is 5 days on, 4 days off; on blocks alternate between early and late duties, but never within a block. These policies regarding safety and rest are much better than in my previous “legacy” airline.

Everyone is entitled to share their opinion, especially in an Internet forum, but please try to keep it fair and don’t dress opinions as facts.


First of all please don’t take anything I have said about Ryanair and their garbage product as a personal reflection upon yourself or your colleagues. But I stand by what I said. There was a memo leaked some years ago from Mol to his staff regarding minimum fuel requirements and how much more money he could make if they perhaps didn’t uplift as much. It was a work of art, really. At the time, various pilots unions and groups jumped on it stating it was illegal because its ultimately the captains responsibility to dictate the fuel requirements for a given flight. But if you read it carefully he never actually “says” that it is no longer the captains prerogative to dictate what fuel is required, he merely points out how much money carrying extra fuel is costing his company and how your career prospects are directly linked to how much money he and his company can make. And it worked, with the addition of random checks on crews to ensure they were operating the aircraft as “efficiently” as is possible there were a flurry of mayday low fuel incidents involving Ryanair.

I would love to link you to the memo but I am genuinely having trouble finding it. Searching for Mol legal treats and staff disputes brings up hundreds of separate incidents. What I do remember though is that there was a documentary made in the he UK by Channel 4 called “secrets of the cockpit” which is available to UK viewers on the All4 app. I’m not sure where to find it as a direct link outside of the UK, but for context here are some highlights from it and the resulting media attention;

Ryanair pilots 'bullied into silence over safety': Two-thirds say they are not comfortable raising fears with their bosses

90% say airline doesn't have 'open and transparent safety culture'

Three-quarters of Ryanair pilots said to be on zero-hours contracts and must pay for all their expenses, including uniforms and transport



There were however many threads here discussing it which I can link too (I have not re-read them all, and this is just a selection). This is about the actual program. This is when Ryanairs own pilots were demanding a safety inquiry. And This relates to one of the many lawsuits Mol filed against the media covering it – All of which he lost.

Finally means I’m linking to things relating to Ryanair’s staff then I have to link to Mentour, although he never states who he works for as a 737 training captain I am 99.9% sure it's FR. It’s a shame, as he would be an excellent advertisement for them, I, for one, would have no issues sitting in the back if he was always sitting up front.

Edited to add: Mod's I know I drifted a little off-topic towards the end, but Ryanair's past is kinda relevant to its future. However, if you are going to delete this post could you please message me with a copy of it, so I can start another thread or resurrect and old one. This post took me over an hour, man I need to get a life :)


Thanks for the links, although I do have to say that they are 8 years old and many things have changed since, for example most pilots are now employed with a direct contract with the airline, most of us pay local taxes and social security, have access to a company funded pension, and are subject to local laws and employment regulations, with collective labor agreements in place, just like any other airline. I’m not trying to change your mind, you’re entitled to your opinion and I fully respect that, I’m just trying to clarify some things that I’ve seen mentioned in this thread.

Regarding fuel loading, I can only say that whatever policy existed in the past is no longer in force, and the safety culture and training is much better than in my previous two airlines, one of them considered a legacy carrier.

And indeed, Mentour pilot would be an excellent advertisement for an airline like Ryanair, but I cannot confirm or deny if he works for the airline. ;)
 
LJ
Posts: 5468
Joined: Wed Nov 17, 1999 8:28 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 8:04 pm

Revelation wrote:
Busy is one thing, profitable is another. If you want to be busy, just offer fares of 1 GBP/USD/EUR, the plane will fill up quick.

DL is flying from secondary UK airport to places like BOS and NYC. In those places they can also book connecting flights to make more money. The 757 has a bit of premium seating so they can make a good markup. The operations in BOS and NYC are already in place and funded by other flights. Adding the UK flights doesn't add much overhead. They already use 757 domestically, using some on TATL routes doesn't add much overhead.

FR would start from scratch. They will find BOS or NYC expensive and hard to get access during desirable flight times. They won't have access to connecting flights, or if they do they will have to partner with someone to get them and that means they get less profit from the connection. No one will pay a premium for a FR flight. They will have little brand recognition on this side of the pond.

FR could try to fly secondary city to secondary city, but those who tried this recently (Norwegian, WizzAir) struggled. You can get a good number of people from Leeds to fly to BOS or NYC but not to Hartford.


The question is also why would you want to fly TATL when your core business is Europe (and maybe Russia + Northern Africa). I would reckon a TATL flight is much more complex given that your crew has to overnight etc. Moreover, how many city pairs can realistically sustain such a service yearround? If it's only sustainable during the Summer and few weeks in December, does it makes sense to buy an aircraft specifically for such purpose? I would say not.

BTW don't you mean WOW AIr instead of WizzAir? I can't recall WizzAir flying to the US.
 
Vicenza
Posts: 393
Joined: Sun Apr 19, 2020 3:21 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 8:48 pm

Gremlinzzzz wrote:
Finally, FR has no obligation to guarantee BCA's profit margins no more than BCA has an obligation to sell this airline a jet at cost or at loss.


Absolutely correct, and it absolutely works both ways but something too many on here ignore. I have seen nothing where MOL expects Boeing, or anyone else, to sell at a loss.
 
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lightsaber
Moderator
Posts: 22917
Joined: Wed Jan 19, 2005 10:55 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 9:31 pm

Revelation wrote:
There are circumstances where Boeing will relent. The problem for FR is that they just missed the biggest window for such we've ever seen, with Boeing desperate due to both MCAS and COVID. They thought they had leverage, now they have found out that they don't

This sums up the result.

To others:
FR wanted a better deal than Boeing was willing to offer. I believe the UA order earlier this year was enough to get Boeing out of negative sales for the year (at least per Wikipedia, I know). I am of the opinion (I know, speculation) that Boeing was "hungry" to prevent the horrid PR of another negative sales year.

I won't speculate on TATL as the -10 need not apply anyway due to lack of range.

This was a negotiation neither had to make happen, but for the right price both would have been happy to reach a deal. The "right price" wasn't arrived at for both. There is a reason bonuses are paid for such deals being concluded.


Lightsaber
 
Opus99
Topic Author
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 9:36 pm

Revelation wrote:
Daysleeper wrote:
Many of the legacy’s offer TATL flights from Manchester, Leeds-Bradford, Birmingham, Edinburgh etc. And I know I am taking a little bit of a liberty in listing a large UK city as a secondary airport but in the UK anything out side of London is “secondary”. And having personally flown on many a Delta757 from LBA or MAN into EWR I can attest to how busy the flights always were. This was of course pre-covid and I am not sure what the current demand would be, but I think any order is going to be dependant on decent post-covid recovery.

And yeah I agree that there would definitely be a risk into entering the TATL market, but I also think there would be reward. Otherwise why would the legacy’s be operating directs from Leeds? It’s what? 2 hours by rail into London where they have existing widebody services. There has to be a money in it for them. And historically that has been MOL’s speciality, picking off profitable roots offered by legacy’s and under cutting them.

Busy is one thing, profitable is another. If you want to be busy, just offer fares of 1 GBP/USD/EUR, the plane will fill up quick.

DL is flying from secondary UK airport to places like BOS and NYC. In those places they can also book connecting flights to make more money. The 757 has a bit of premium seating so they can make a good markup. The operations in BOS and NYC are already in place and funded by other flights. Adding the UK flights doesn't add much overhead. They already use 757 domestically, using some on TATL routes doesn't add much overhead.

FR would start from scratch. They will find BOS or NYC expensive and hard to get access during desirable flight times. They won't have access to connecting flights, or if they do they will have to partner with someone to get them and that means they get less profit from the connection. No one will pay a premium for a FR flight. They will have little brand recognition on this side of the pond.

FR could try to fly secondary city to secondary city, but those who tried this recently (Norwegian, WizzAir) struggled. You can get a good number of people from Leeds to fly to BOS or NYC but not to Hartford.

Daysleeper wrote:
Yup, I have absolutely no doubt that should MOL re-start negotiations for the Max10 with an A321 order in pocket he is going to really tighten the screws on Boeing. And to be fair he would in theory be in a much better position than he is now to do so. Will Boeing relent? don’t know for sure. But if history is any guide then they will.

There are circumstances where Boeing will relent. The problem for FR is that they just missed the biggest window for such we've ever seen, with Boeing desperate due to both MCAS and COVID. They thought they had leverage, now they have found out that they don't, and they're kicking their toys out of the pram. Their only realistic choices are to pay up or wait. Even FR seems to know it might be years before the right circumstances come together. All we know for sure is FR will claim victory either way.

But if they don’t pay up now, won’t it just get worse? With the full recovery coming closer and closer
 
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FiscAutTecGarte
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 10:58 pm

Opus99 wrote:
But if they don’t pay up now, won’t it just get worse? With the full recovery coming closer and closer


I'm not so sure. I work in a very specific industry that supplies many other industries with their products. Historically this industry has always lead a recession and lagged a recovery. Factory orders always seem to be an indication of where the economy is headed. This is anecdotal yes, but it's been my observation for almost 29 years.

As I was planning a few projects for the remainder of 2021, I was informed that they were probably looking at 3 layoffs between now and Christmas (a layoff is where they shut production down for a week or more and actually have the employees stay at home and file for unemployment instead of staying in the plants and doing busy work for the week). That of course doesn't count the 1 week layoff they took this week around Labor Day. I work accross 5 plants in Canada, USA and Mexico. This was their largest most advanced plant. So 4 work stoppages, Sep - Dec, to curtail production and save money.

So, I'm a bit guarded... The economy has been running pretty hot for a few years despite all that Covid has brought... MOL may get another opportunity to press Boeing on prices in a few short years. I just don't know. Who really does?
 
Daysleeper
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Thu Sep 09, 2021 11:29 pm

Revelation wrote:
Busy is one thing, profitable is another. If you want to be busy, just offer fares of 1 GBP/USD/EUR, the plane will fill up quick.

DL is flying from secondary UK airport to places like BOS and NYC. In those places they can also book connecting flights to make more money. The 757 has a bit of premium seating so they can make a good markup. The operations in BOS and NYC are already in place and funded by other flights. Adding the UK flights doesn't add much overhead. They already use 757 domestically, using some on TATL routes doesn't add much overhead.

FR would start from scratch. They will find BOS or NYC expensive and hard to get access during desirable flight times. They won't have access to connecting flights, or if they do they will have to partner with someone to get them and that means they get less profit from the connection. No one will pay a premium for a FR flight. They will have little brand recognition on this side of the pond.

FR could try to fly secondary city to secondary city, but those who tried this recently (Norwegian, WizzAir) struggled. You can get a good number of people from Leeds to fly to BOS or NYC but not to Hartford.

All very good points, and a couple of others I had not even considered. But just to clarify what I was trying to convey in my initial post; I don’t think that this is likely, or perhaps even the best option for FR – but after much more thought I have gone from the view that “only on a cold day in hell” would Mol order airbus to maybe, just maybe there is a way he could.

I had not thought of DL using its thin TATL routes to feed it US hubs, despite actually doing exactly that multiple times myself. In my defence I was flying J for work at the time and I don’t think there would be many companies booking their staff on FR for business travel anytime soon so it’s probably not a major factor. I think low cost TATL would be for leisure which indeed would be seasonal to a point, but as are many of FR’s European routes, but they seem to make them work year-round. There is also Florida (I often forget that there are people who actually want to go to FL :) ) which I think should just be in range for the XLR from all of the UK

One could also argue given the size of FR’s operation in Europe now and how many FR flights there are on a given day from MAN or LBA they could offer further connections into Europe where perhaps seasonality would be less of an issue.

There are obviously a lot of unknowns here, but with Jet Blue managing to both find and afford London slots for its foray into TATL using the 321Lr’s I am not alone in seeing the potential market here. And I am SURE MOL will be eagerly watching how they perform before he commits to anything.

Revelation wrote:
There are circumstances where Boeing will relent. The problem for FR is that they just missed the biggest window for such we've ever seen, with Boeing desperate due to both MCAS and COVID. They thought they had leverage, now they have found out that they don't, and they're kicking their toys out of the pram. Their only realistic choices are to pay up or wait. Even FR seems to know it might be years before the right circumstances come together. All we know for sure is FR will claim victory either way.


Absolutely, I agree in that MOL has missed the boat in regards to taking advantage of Boeing when they are in crisis. Problem is the Boeing crisis boat seems to be a regular scheduled service now, so I am sure there will be another along shortly. Not to mention the constant clatter of economists predicting hyper inflation and a stock market crash is about to happen, adding perhaps another crisis he could take advantage of. (Side note, I know NOTHING about economics so I have no idea if my last point is valid)

LJ wrote:
The question is also why would you want to fly TATL when your core business is Europe (and maybe Russia + Northern Africa). I would reckon a TATL flight is much more complex given that your crew has to overnight etc. Moreover, how many city pairs can realistically sustain such a service yearround? If it's only sustainable during the Summer and few weeks in December, does it makes sense to buy an aircraft specifically for such purpose? I would say not.


As I outlined above I don’t think this is likely, but nor do I think it impossible. In regards to increased staff accommodation costs, well I am sure MOL can find a solution to a little problem like that. We can look forwards to seeing the “FR Skid Row” around any unused taxi-way when he issues crews tents and tell them to “make do” :)

SIVB wrote:

Thanks for the links, although I do have to say that they are 8 years old and many things have changed since, for example most pilots are now employed with a direct contract with the airline, most of us pay local taxes and social security, have access to a company funded pension, and are subject to local laws and employment regulations, with collective labor agreements in place, just like any other airline. I’m not trying to change your mind, you’re entitled to your opinion and I fully respect that, I’m just trying to clarify some things that I’ve seen mentioned in this thread.

Regarding fuel loading, I can only say that whatever policy existed in the past is no longer in force, and the safety culture and training is much better than in my previous two airlines, one of them considered a legacy carrier.

And indeed, Mentour pilot would be an excellent advertisement for an airline like Ryanair, but I cannot confirm or deny if he works for the airline. ;)


Indeed, the whole fuel saga was almost a decade ago now and perhaps the outcry from Ryanair’s own staff and media at the time did bring in some changes. It’s genuinely encouraging to know that this is not something you have ever encountered whist working for them and perhaps these are old policy’s that no longer apply.

As I said in a previous post it was at that point that I decided to no longer book any FR flight, but truth be told I have very little reason too. The vast majority of my travel is for work, and since discovering that I can fly from my local regional airport into AMS via KLM city hopper faster than I can get to either Manchester or London by train, I have never looked back, or even been into a UK airport larger than Humberside since. But I will stop bad mouthing FR to family and friends looking for a cheap get away in the future, well perhaps not stop, but reduce it a lot :)

In regards to Mentour, I was looking back trying to find a video he did which is somewhat relevant to what we were discussing. He mentioned that he once chose to hold for what I think he said was over two hours due to weather rather than go to his alternate. And he actually said the reason he was able to do this safely was because they were “tankering” the fuel for the next leg as it was much cheaper for the airline to purchase fuel at their home base. I was not aware that this was a thing Airlines did, actually calculate the cost of carrying more fuel to continue the journey rather than re-fill at the destination. Is it common within Europe? Do all airlines do it?
 
VictorKilo
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 3:53 am

Vicenza wrote:
VictorKilo wrote:

If anything I think the public whining by MOL made things worse. BCA executives are under pressure to make cash, and publicly holding their ground on price is a good way to show that they are concerned about profits and cash flow and not just sales volume.


It is entirely up to MOL how he wishes to do business and, whether 'right' or 'wrong' does not need the approval of anyone on a.net. As I've said before, MOL's actions at any given time are entirely dependent upon the agenda of members.. As per your last sentence, I can't quite decide whether you mean "concerned about profits...." in an ethical, or non-ethical, way.


What I mean by “concerned about profits” is that BCA has booked enough deals to show that there is demand for the MAX after the grounding, so they no longer need to book deals to book deals. Each deal they do going forward should earn variable profit. If MOL (or Delta, or anyone else) doesn’t want to pay those prices, they can take their business elsewhere. MOL doesn’t need my approval on how he reacts to that, and any user here doesn’t need anyone else’s approval for how they view MOL’s reaction.

I also believe that it’s ethical to make money on your products and behaving ethically is a requirement to make money long term - the whole reason Boeing is in this mess and MOL thinks he has an opportunity to exploit BCA is because BCA cut comers to maximize profits only to have that choice cost it much more money in the long term than if it has done the right thing from the beginning. (I’m discouraged that BCA didn’t learn from that experience when reading the 787 thread).
 
iamlucky13
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 5:36 am

As a historical reminder:

The deal that established Ryanair's reputation as opportunistic was in 2002, in the recession after 9/11, the dotcom bubble collapse, and the overcapacity issues that had hit the airline industry in the late 90's when growth in Asia flattened suddenly. The backlog was below 3 years then, I believe. This was the tail end of one of the worst times in history for the aviation industry.

The negotiations that led Airbus to publicly spurn Ryanair were in 2009, during the global financial crisis and the 787 troubles. As far as I can gather, Ryanair figured if they could get low enough pricing, they could accelerate their growth due to the advantage those low prices would give them versus their weakened competitors. Boeing didn't cave. Ryanair made some comments about both manufacturers being overpriced and ruining their plans. In reality, they simply held off until 2013 when they made another big order.

So 2009-2013 looks like a potentially instructive precedent for where things stand right now: Ryanair thought the opportunity was ripe again. As so many members have already pointed out in this thread, they were actually too slow to make their move in order to get a unusually good deal. Yet, they will need new planes eventually.

Both sides will probably bide their time. Given Ryanair let one of the US legacies, of all airlines, outrun them to the negotiating table, I don't get the impression Ryanair is in a hurry to order. They very likely want the -10 eventually, but it seems not yet. Boeing is seriously weakened, but still has what historically would be viewed as an excellent order book. With around 3300 orders under ASC 606, if Boeing reaches 30/month in early 2022 as projected, and ramps linearly from there back up to 57/month, they have over a 6 year backlog.
 
BrianDromey
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 7:14 am

If the A321neo advantage over the -8200 is as big as some suggest then Ryanair will want the -10. The passenger difference alone must skew CASK towards the A321 (230 Vs 197). In a market where costs are king and ancillary revenue is queen the A321 writes its own case.

There are a few issues with posts up thread.
1) The FR group already operate 30 A320s at Lauda Europe. Any A32x added to the fleet would surely be added there, rather than “mainline” FR. Arguments about additional costs and complexities, spares and all the rest are null for Ryanair. Indeed 30 is a bit small for a standalone airline, so A32x additions/orders are probably likely.
2) FR has been talking about transatlantic for decades. With the -8200 they have the aircraft to do it. Their huge brand recognition in Dublin and the Norwegian attempt with -800s and -8MAX show it can be done. But Ryanair would rather fly to the Canaries or add a 15th daily flight to Malaga. Now they have the aircraft that could do it we hear absolutely nothing. Not even the usual MOL style “well if the government opened the borders we’d fly 10 flights a day between ABC and DEF” for €1 a seat.
3) Posts about “many” flights to LBA on DL 757s are pure fantasy. It never happened. The only transatlantic flights from there were Jet2’s highly seasonal Christmas shopping trips. I don’t think there are any 757 transatlantic flights left now? It’s a marginal market, highly seasonal with low yields and utilisation compared to short haul flying.
 
Noshow
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 8:21 am

The key info is that FR wants to grow beyond the 8200 capacity.

This makes sense as their competitors like Wizz arm up on A321neos. The long range capability might be only secondary. I see them going widebody and with a separate brand anyway for long range. However this future growth plan will play a role for the bigger narrowbody order of today already.
Say they now in fact might debate about 787 pricing or combing A321 and A330neo or similar?
 
DartHerald
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 8:56 am

BrianDromey wrote:
I
There are a few issus with posts up thread.
1) The FR group already operate 30 A320s at Lauda Europe. Any A32x added to the fleet would surely be added there, rather than “mainline” FR. Arguments about additional costs and complexities, spares and all the rest are null for Ryanair. Indeed 30 is a bit small for a standalone airline, so A32x additions/orders are probably likely.


Haven't Ryanair said fairly recently that they intend to eliminate the Lauda A320 fleet in favour of 737s, though?
 
BrianDromey
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 10:38 am

DartHerald wrote:
Haven't Ryanair said fairly recently that they intend to eliminate the Lauda A320 fleet in favour of 737s, though?


They did, possibly, say that win May 2020, but were still taking delivery of used A320s in December 2020. Articles say the phase out would happen over the next 3-4 years. The only more recent article is from simplefying and says that Ryanair will replace the A320s with 737-10MAXs, a type they do not have on order. In any case, the point remains that A32x is currently operated by an airline in the FR group, the training, crews, maintenance, technical procedures and support all exist within the Ryanair ecosystem.
 
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 1:57 pm

LJ wrote:
The question is also why would you want to fly TATL when your core business is Europe (and maybe Russia + Northern Africa). I would reckon a TATL flight is much more complex given that your crew has to overnight etc. Moreover, how many city pairs can realistically sustain such a service yearround? If it's only sustainable during the Summer and few weeks in December, does it makes sense to buy an aircraft specifically for such purpose? I would say not.

BTW don't you mean WOW AIr instead of WizzAir? I can't recall WizzAir flying to the US.

I agree, it seems there is a lot more of a challenge to getting it right otherwise they would have followed the model that Norwegian and WOW tried and that JetBlue is now trying. Icelandic gets an honorable mention too. The slow times are a huge challenge to an airline that values high aircraft utilization.

Personally, I'm all for cheap TATL service. If nothing else it will undermine the pricing power of the majors. I value comfort enough to pay a bit more to not be in a FR seat, and if that costs too much more, I'll stay at home.

And yes, I did get it wrong, the current WizzAir thread made me auto-correct to it instead of WOW.

BrianDromey wrote:
If the A321neo advantage over the -8200 is as big as some suggest then Ryanair will want the -10. The passenger difference alone must skew CASK towards the A321 (230 Vs 197). In a market where costs are king and ancillary revenue is queen the A321 writes its own case.

There are a few issues with posts up thread.
1) The FR group already operate 30 A320s at Lauda Europe. Any A32x added to the fleet would surely be added there, rather than “mainline” FR. Arguments about additional costs and complexities, spares and all the rest are null for Ryanair. Indeed 30 is a bit small for a standalone airline, so A32x additions/orders are probably likely.
2) FR has been talking about transatlantic for decades. With the -8200 they have the aircraft to do it. Their huge brand recognition in Dublin and the Norwegian attempt with -800s and -8MAX show it can be done. But Ryanair would rather fly to the Canaries or add a 15th daily flight to Malaga. Now they have the aircraft that could do it we hear absolutely nothing. Not even the usual MOL style “well if the government opened the borders we’d fly 10 flights a day between ABC and DEF” for €1 a seat.

Indeed. We all know FR is successful and has plenty of money in the bank and access to much more via loans, so what is stopping MOL from just doing it, with either 8200, MAX10 or A321neo? I'd suggest the answer is that there really isn't good money in it, with any of the approaches available to him, and indeed FR makes more money by adding the 15th daily flight to Malaga.
 
BrianDromey
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 2:39 pm

Revelation wrote:
Indeed. We all know FR is successful and has plenty of money in the bank and access to much more via loans, so what is stopping MOL from just doing it, with either 8200, MAX10 or A321neo? I'd suggest the answer is that there really isn't good money in it, with any of the approaches available to him, and indeed FR makes more money by adding the 15th daily flight to Malaga.

I think the KEF based airlines have a slightly different angle. The geographical location means can get good utilisation by hubbing at KEF, they don’t have to overnight at every US destination and they can also connect a huge number of secondary cities on either side of the Atlantic together via KEF. Their stage lengths are also bang in the 3-5 hour stage lengths where narrow bodies are most efficient. They are not pushing the payload/range envelope to any great extent. While Icelandair and Wow/PLAY do offer transatlantic service their main base happens to be in the middle of the North Atlantic, rather than ROM, PAR or LON.
 
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Fri Sep 10, 2021 2:51 pm

BrianDromey wrote:
Revelation wrote:
Indeed. We all know FR is successful and has plenty of money in the bank and access to much more via loans, so what is stopping MOL from just doing it, with either 8200, MAX10 or A321neo? I'd suggest the answer is that there really isn't good money in it, with any of the approaches available to him, and indeed FR makes more money by adding the 15th daily flight to Malaga.

I think the KEF based airlines have a slightly different angle. The geographical location means can get good utilisation by hubbing at KEF, they don’t have to overnight at every US destination and they can also connect a huge number of secondary cities on either side of the Atlantic together via KEF. Their stage lengths are also bang in the 3-5 hour stage lengths where narrow bodies are most efficient. They are not pushing the payload/range envelope to any great extent. While Icelandair and Wow/PLAY do offer transatlantic service their main base happens to be in the middle of the North Atlantic, rather than ROM, PAR or LON.

Good points all. As a consumer, I'm not a big fan of changing planes in the middle of my sleep cycle, and if you look at the routings they do need to fly hundreds of miles off the non-stop track to stop in Iceland which extends the journey for the pax and adds cost for the airline. Therefore, those who can do a non-stop have a market advantage, IMO.

Still, as you suggested earlier, there's nothing to stop MOL from starting TATL service now if he wanted to. He's got MAX8s incoming and attractively priced options for more if he wants them. It's really tangential to the MAX10 situation.
 
Flyglobal
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 2:14 pm

And Mr Ryanair is still pissed. Warns for the risk for Boeing to loose all European market for the 737.
Seems that he still requests Boeings duty to sell jets at his price intention. Good luck!
Sorry link German- you may use google translate.
https://www.aero.de/news-40839/Ryanair- ... uropa.html
 
wjcandee
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 2:45 pm

Vicenza wrote:
DarkSnowyNight wrote:
Vicenza wrote:
Name any airline who pays more for aircraft than they have to, and especially when an order is not for just 10 or 20?


I find it very interesting that this site routinely congratulates DL for doing literally the exact same thing as being a tightly run ship. But when it is FR, EK, QR, etc, all of a sudden it is 'dramatic.' FR have no obligation to ensure BCA's profit margins, and I do not get where on earth the idea came from that otherwise could ever somehow be true.


Agree with you entirely, and seemingly one of the myths of a.net that I simply have ever been unable to fathom. It is entirely up to Boeing to choose whatever minimum price they will accept, and under which conditions and/or risk involved. But yet, when seemingly Boeing need a large order, those same members when the agenda suits are the first ones to want and shout for the likes of FR.


There's a very-significant stylistic difference between MOL and the DL guys, present and past. The result may be the same -- buy opportunistically -- but the DL guys don't throw around crazy statements as if they're true, or float trial-baloons for crazy things (stand-up flights) just for the purpose of creating media outrage and resulting free publicity. The DL guys also don't act entitled the way MOL does.

It's like the difference between Tim Clark and AAB.
 
Vicenza
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 4:40 pm

wjcandee wrote:
Vicenza wrote:
DarkSnowyNight wrote:

I find it very interesting that this site routinely congratulates DL for doing literally the exact same thing as being a tightly run ship. But when it is FR, EK, QR, etc, all of a sudden it is 'dramatic.' FR have no obligation to ensure BCA's profit margins, and I do not get where on earth the idea came from that otherwise could ever somehow be true.


Agree with you entirely, and seemingly one of the myths of a.net that I simply have ever been unable to fathom. It is entirely up to Boeing to choose whatever minimum price they will accept, and under which conditions and/or risk involved. But yet, when seemingly Boeing need a large order, those same members when the agenda suits are the first ones to want and shout for the likes of FR.


There's a very-significant stylistic difference between MOL and the DL guys, present and past. The result may be the same -- buy opportunistically -- but the DL guys don't throw around crazy statements as if they're true, or float trial-baloons for crazy things (stand-up flights) just for the purpose of creating media outrage and resulting free publicity. The DL guys also don't act entitled the way MOL does.

It's like the difference between Tim Clark and AAB.


But the posts you commented on where not about any differences, perceived or real, between DL and MOL. As you mentioned, the results are the same and which was exactly the point of the posts. If publicity helps gets MOL the deal he wants then fair play, and he has done his job. Whether anyone on a.net agrees, or disagrees, is completely irrelevant.
 
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 5:01 pm

wjcandee wrote:
Vicenza wrote:
DarkSnowyNight wrote:

I find it very interesting that this site routinely congratulates DL for doing literally the exact same thing as being a tightly run ship. But when it is FR, EK, QR, etc, all of a sudden it is 'dramatic.' FR have no obligation to ensure BCA's profit margins, and I do not get where on earth the idea came from that otherwise could ever somehow be true.


Agree with you entirely, and seemingly one of the myths of a.net that I simply have ever been unable to fathom. It is entirely up to Boeing to choose whatever minimum price they will accept, and under which conditions and/or risk involved. But yet, when seemingly Boeing need a large order, those same members when the agenda suits are the first ones to want and shout for the likes of FR.


There's a very-significant stylistic difference between MOL and the DL guys, present and past. The result may be the same -- buy opportunistically -- but the DL guys don't throw around crazy statements as if they're true, or float trial-baloons for crazy things (stand-up flights) just for the purpose of creating media outrage and resulting free publicity. The DL guys also don't act entitled the way MOL does.

It's like the difference between Tim Clark and AAB.

We need to remember it isn't a minimum price, but a minimum profit on a contract. In billion dollar contracts you can focus on price like MOL/FR, because they do not keep the planes long enough to have maintenance drive their costs

DL keeps aircraft, traditionally, for a long time. They will care more about long term parts and service costs as well as the potential profit of servicing other airlines aircraft and engines. This creates a much higher dimension negotiations, but with more "knobs to turn." e.g., lower parts costs, but higher minimum parts buys. Both look at the business case, but because timelines and priorities differ, there is more likely to be common ground found

I posted a link earlier where Pratt let LH repair accessories, but kept the core parts for Peatt's own profit. I have no idea what price DL pays for parts, but they must make a profit performing maintenance for Pratt (e.g., just like RR had DL overhaul VS engines, but that overhaul is a profit center for DL).

FR has no overhaul shop. So there is price and short term parts. There just aren't enough ways for Boeing to sell at a profit and reduce the costs to FR while ensuring a profit for a business case.

Lightsaber
 
wjcandee
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 5:36 pm

lightsaber wrote:
[In billion dollar contracts you can focus on price like MOL/FR, because they do not keep the planes long enough to have maintenance drive their costs


Great post, once again proving that the deals discussed here are negotiated at a level of complexity that usually isn't taken into account by many analysts, here and elsewhere.
 
Interflug74
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 6:56 pm

Will Ryanluft ever make normal negotiations with airport-authorities, federal states or plane manufacturers? they always play offendend to achieve their goals. cant take them serious
 
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JannEejit
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Sun Sep 26, 2021 9:01 pm

Interflug74 wrote:
Will Ryanluft ever make normal negotiations with airport-authorities, federal states or plane manufacturers? they always play offendend to achieve their goals. cant take them serious


I'm sure their abrasive style (which has wept into common business practice) will go out of fashion at some stage, who knows though ? Many years ago when I worked in television news (camera guy) I was sent out with a reporter to attend a press conference at Prestwick Airport, the at the time unheard of Ryanair where launching there in a blaze of publicity, and a certain Michael O'Leary was to be giving an interview. I have to say I've seldom met a ruder, more arrogant, so self assured wanker in my life. Just an utter gobshoite as they say in Ireland. I remember the newsroom editor at the time dropping the story from that evening's broadcast.
 
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 11:46 am

If stating a fact, please post a link.
 
HTCone
Posts: 179
Joined: Sun Jul 16, 2017 7:10 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 12:56 pm

Ancillary revenue (extra baggage allowance, scratchcards, Bob, car rental, travel insurance etc) made up approx one third of Ryanair's revenue pre COVID and was growing YoY (up 19% in 2019)

https://www.google.com/url?sa=t&source= ... 2746814410

As such, O'Leary went very cool on TATL. FR can make far more ancillary revenue using their aircraft 6-8 times per day within Europe than 2 times per day TATL. We won't be seeing them in that market at least until Europe is saturated, especially after seeing what happened to Norwegian. Not to mention MOL has said he expects demand to outstrip capacity within Europe for a couple of years at least.

https://amp.rte.ie/amp/1246179/

As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.

"Until they need an order from the Ryanair Group, frankly we are wasting our time talking to Airbus," he added, without elaborating.
 
Vicenza
Posts: 393
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 4:12 pm

HTCone wrote:
Ancillary revenue (extra baggage allowance, scratchcards, Bob, car rental, travel insurance etc) made up approx one third of Ryanair's revenue pre COVID and was growing YoY (up 19% in 2019)

https://www.google.com/url?sa=t&source= ... 2746814410

As such, O'Leary went very cool on TATL. FR can make far more ancillary revenue using their aircraft 6-8 times per day within Europe than 2 times per day TATL. We won't be seeing them in that market at least until Europe is saturated, especially after seeing what happened to Norwegian. Not to mention MOL has said he expects demand to outstrip capacity within Europe for a couple of years at least.

https://amp.rte.ie/amp/1246179/

As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.

"Until they need an order from the Ryanair Group, frankly we are wasting our time talking to Airbus," he added, without elaborating.



And I can't see, for the foreseeable future Airbus needing an order from Ryanair Group, so not surprising he doesn't want to elaborate on his comment.
 
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Revelation
Posts: 26723
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 4:19 pm

HTCone wrote:
Vicenza wrote:
As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.

"Until they need an order from the Ryanair Group, frankly we are wasting our time talking to Airbus," he added, without elaborating.

And I can't see, for the foreseeable future Airbus needing an order from Ryanair Group, so not surprising he doesn't want to elaborate on his comment.

And if he has zero leverage with Airbus, he also has zero leverage with Boeing.

No wonder he's so grumpy.

He should have gotten his MAX10 order in earlier when he still had some leverage to work with, namely compensation credits and Boeing still behind the curve in filling up production line slots.

Now he has no leverage and he'll just have to wait for the next good buying opportunity.

Seems one always comes along, so he'll just have to be patient, which unfortunately isn't his strong suit.
 
mrbonfire
Posts: 87
Joined: Wed May 10, 2017 8:59 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 7:12 pm

lightsaber wrote:
wjcandee wrote:
Vicenza wrote:

Agree with you entirely, and seemingly one of the myths of a.net that I simply have ever been unable to fathom. It is entirely up to Boeing to choose whatever minimum price they will accept, and under which conditions and/or risk involved. But yet, when seemingly Boeing need a large order, those same members when the agenda suits are the first ones to want and shout for the likes of FR.


There's a very-significant stylistic difference between MOL and the DL guys, present and past. The result may be the same -- buy opportunistically -- but the DL guys don't throw around crazy statements as if they're true, or float trial-baloons for crazy things (stand-up flights) just for the purpose of creating media outrage and resulting free publicity. The DL guys also don't act entitled the way MOL does.

It's like the difference between Tim Clark and AAB.

We need to remember it isn't a minimum price, but a minimum profit on a contract. In billion dollar contracts you can focus on price like MOL/FR, because they do not keep the planes long enough to have maintenance drive their costs

DL keeps aircraft, traditionally, for a long time. They will care more about long term parts and service costs as well as the potential profit of servicing other airlines aircraft and engines. This creates a much higher dimension negotiations, but with more "knobs to turn." e.g., lower parts costs, but higher minimum parts buys. Both look at the business case, but because timelines and priorities differ, there is more likely to be common ground found

I posted a link earlier where Pratt let LH repair accessories, but kept the core parts for Peatt's own profit. I have no idea what price DL pays for parts, but they must make a profit performing maintenance for Pratt (e.g., just like RR had DL overhaul VS engines, but that overhaul is a profit center for DL).

FR has no overhaul shop. So there is price and short term parts. There just aren't enough ways for Boeing to sell at a profit and reduce the costs to FR while ensuring a profit for a business case.

Lightsaber


With some aircraft now 16 years old, wouldn't they be having heavy maintenance checks? Didn't they contract a company in the Middle East to do this?
 
airsmiles
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Mon Sep 27, 2021 7:21 pm

wjcandee wrote:
With some aircraft now 16 years old, wouldn't they be having heavy maintenance checks? Didn't they contract a company in the Middle East to do this?


There are four aircraft in the EI-DAx batch that are now 18 years old and plenty of 17 year old aircraft in the EI-DCx batch. This is past “elderly” for Ryanair, but not at all unusual for other airlines.
 
iamlucky13
Posts: 1455
Joined: Wed Aug 08, 2007 12:35 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 1:51 am

Revelation wrote:
HTCone wrote:
Vicenza wrote:
As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.

"Until they need an order from the Ryanair Group, frankly we are wasting our time talking to Airbus," he added, without elaborating.

And I can't see, for the foreseeable future Airbus needing an order from Ryanair Group, so not surprising he doesn't want to elaborate on his comment.

And if he has zero leverage with Airbus, he also has zero leverage with Boeing.

No wonder he's so grumpy.

He should have gotten his MAX10 order in earlier when he still had some leverage to work with, namely compensation credits and Boeing still behind the curve in filling up production line slots.

Now he has no leverage and he'll just have to wait for the next good buying opportunity.

Seems one always comes along, so he'll just have to be patient, which unfortunately isn't his strong suit.


I don't know if they'll even need any particularly great buying opportunity to sign a deal. During the aftermath of the global financial crisis, it was also treated as big news when negotiations for a big 737 order ended with no deal.

But then in 2013, Ryanair placed their largest order ever for 175 Next Gens. And in 2014, they placed another large order for 100 MAX's. I don't recall either time being remarkably good negotiating opportunities. But Ryanair was at the point of wanting to replace many of their older planes, and needed more capacity, and then when the MAX was offered in the -8200 model, they made the LEAP to new engines.

So since Ryanair did not get an exceptional deal in the present circumstances, there's no rush. If another opportunity arises, they'll try then, too. Otherwise, they'll negotiate a much more ordinary deal when growth and fleet replacement calls for it, and there probably won't be as much fuss that time around.
 
2175301
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Joined: Wed May 16, 2007 11:19 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 2:58 am

iamlucky13 wrote:
So since Ryanair did not get an exceptional deal in the present circumstances, there's no rush. If another opportunity arises, they'll try then, too. Otherwise, they'll negotiate a much more ordinary deal when growth and fleet replacement calls for it, and there probably won't be as much fuss that time around.


I don't believe that MOL can negotiate any deal without a lot of public fussing.

I have no recollection of that ever happening; and I've pleanty of recollection of all the fussing that MOL has done over the years.

Perhaps you can list a number of examples where MOL did deals without much fuss.


Have a great day,
 
iamlucky13
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 4:26 am

2175301 wrote:
iamlucky13 wrote:
So since Ryanair did not get an exceptional deal in the present circumstances, there's no rush. If another opportunity arises, they'll try then, too. Otherwise, they'll negotiate a much more ordinary deal when growth and fleet replacement calls for it, and there probably won't be as much fuss that time around.


I don't believe that MOL can negotiate any deal without a lot of public fussing.

I have no recollection of that ever happening; and I've pleanty of recollection of all the fussing that MOL has done over the years.

Perhaps you can list a number of examples where MOL did deals without much fuss.


I don't recall a lot of bluster around the 2013 order, and doing a search now, limited by date to try to get articles from immediately before and immediately after the order was announced, I'm not finding it restrospectively. He did bring up the possibility of a C919, but seemingly as a complement to more 737's, not a substitute. He gave little doubt that the question was not about if Ryanair would order more 737's, but which variant and for what price:

https://www.flightglobal.com/ryanair-ta ... 64.article

We are in ongoing discussions with Boeing and as soon as we can reach an agreement on price we'll place an order. It could be the -800 or the Max, whichever they discount the most - we'd buy a dog if it was cheap enough.
 
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scbriml
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Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 7:27 am

HTCone wrote:
As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.


You can characterise that as "Airbus refusing to negotiate", but it reads like O'Leary refusing to talk to Airbus just as much. It takes two willing parties to negotiate. Given Ryanair's previous behaviour with Airbus, it's no surprise. Why would Airbus allow themselves to be used as a stalking horse just so Ryanair can squeeze some additional concessions from Boeing?

Either way, O'Leary's rage after painting himself into a corner is amusing.

Revelation wrote:
And if he has zero leverage with Airbus, he also has zero leverage with Boeing.

No wonder he's so grumpy.


Indeed. :lol:
 
bluecrew
Posts: 103
Joined: Sun Apr 20, 2014 3:13 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 7:36 am

Revelation wrote:
HTCone wrote:
Vicenza wrote:
As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.

"Until they need an order from the Ryanair Group, frankly we are wasting our time talking to Airbus," he added, without elaborating.

And I can't see, for the foreseeable future Airbus needing an order from Ryanair Group, so not surprising he doesn't want to elaborate on his comment.

And if he has zero leverage with Airbus, he also has zero leverage with Boeing.

No wonder he's so grumpy.

He should have gotten his MAX10 order in earlier when he still had some leverage to work with, namely compensation credits and Boeing still behind the curve in filling up production line slots.

Now he has no leverage and he'll just have to wait for the next good buying opportunity.

Seems one always comes along, so he'll just have to be patient, which unfortunately isn't his strong suit.

Also, I'd assume the Airbus delivery backlog is a bit higher than Boeing's at the moment for the NEO. Boeing is coming off a big sell-off of already ordered, canceled frames. Airbus has had a pipeline of steady NEO orders from a product that beat Boeing to the market and got more orders initially.

I don't know why Airbus would answer his calls at this point. He's clearly shopping around for a tentative contract so he can wave it at Boeing for a discount. Salespeople don't get paid on quotes.

Exactly the same as when Gary Kelly has people float to the Dallas Morning News that he's been flying a lot of A220s and might even grab some poutine in Montreal next week. Theatre. They want a discount.
 
Flyglobal
Posts: 551
Joined: Sat Mar 15, 2008 6:25 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 9:19 am

And it is more important for Airbus to keep prices up in the narrow body sector. They know that they have the better offering in this segment and recently Airbus sales said it is worth a premium. Further they know it is not realistic to grab much more than 60% market share. So, to the benefit of all airbus sets the price margin and it should be high enough that Boeing can sell with profit.
This will only change when Boeing finally decides for a new offer, or when Russian or Chinese offers are ready to compete.
 
PhilipBass
Posts: 48
Joined: Fri Feb 19, 2021 6:30 pm

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 11:08 am

Assuming no world financial market meltdown Boeing will use Ryanair for smaller 50 airframe orders at times when they need to bolster their share price and Ryanair will happily oblige so long as the invoice price meets their expectations.
 
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keesje
Posts: 14616
Joined: Thu Apr 12, 2001 2:08 am

Re: Updated: Ryanair ends jet order talks with Boeing amid price dispute

Tue Sep 28, 2021 11:08 am

scbriml wrote:
HTCone wrote:
As for Lauda and Airbus, MOL is on the record that Airbus effectively refused to negotiate with them when he investigated a potential order for 100 A321 Neos.

https://www.google.com/amp/s/mobile.reu ... SKBN22O1IZ

"We would not initiate talks with Airbus until such time as Airbus wants to initiate talks with us," he said in an interview.


You can characterise that as "Airbus refusing to negotiate", but it reads like O'Leary refusing to talk to Airbus just as much. It takes two willing parties to negotiate. Given Ryanair's previous behaviour with Airbus, it's no surprise. Why would Airbus allow themselves to be used as a stalking horse just so Ryanair can squeeze some additional concessions from Boeing?

Either way, O'Leary's rage after painting himself into a corner is amusing.

Revelation wrote:
And if he has zero leverage with Airbus, he also has zero leverage with Boeing.

No wonder he's so grumpy.


Indeed. :lol:


I can't imagine Ryanair doesn't have a recent reasonable Airbus proposal on their desk. But they don't like it obviously. My unproven conspiracy theory is that when the Airbus sales team would get board approval to pull in Ryanair, at the pricing level they want, it might trigger developments in the US that disrupt he current beneficial status quo for Airbus. So it's strategy too.

It's funny to see Michael O'L though, wondering why, if he makes the best choices, everybody else is selecting the other one.

Image
https://www.flightglobal.com/networks/w ... 04.article
Last edited by keesje on Tue Sep 28, 2021 11:23 am, edited 1 time in total.
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