Ryan faces passenger losses, revenue damage due to Boeing delivery delays
Date
8/28/2024 5:39:28 AM
(MENAFN) Ryanair CEO Michael O'Leary has announced that the airline will experience a significant reduction in passenger numbers this year, primarily due to delays in Boeing aircraft deliveries. O'Leary revealed that the airline expects to carry five million fewer passengers than initially projected, with the revised estimate now standing at 205 million. This shortfall is attributed to Boeing's delays in delivering the 350 single-aisle Boeing 737 aircraft that Ryanair had ordered. The delays, caused by ongoing technical issues at the U.S. manufacturer, have disrupted Ryanair's growth plans for the year.
O'Leary expressed frustration over the situation, noting that Ryanair had anticipated receiving seven aircraft in July but only received five, and is now expected to get only five out of the ten aircraft scheduled for August. He described the current dealings with Boeing as "very frustrating," emphasizing the impact on the airline's operational efficiency and growth. The delay in aircraft delivery is projected to result in a revenue loss of approximately 500 million euros (USD550 million) for Ryanair this year.
Despite Boeing's provision of modest compensation for the delays, O'Leary highlighted that the compensation does not offset the loss of potential revenue and growth opportunities. Additionally, Ryanair's first-half results were negatively affected by a 15% drop in ticket prices compared to the previous year, driven by higher interest rates which have diminished customers' disposable income and travel budgets. O'Leary expects that while the decline in ticket prices has impacted the company's financial performance, it should improve later in the year.
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