Irish giant Ryanair, Boeing’s largest customer outside the United States, said it will not complete a deal to purchase new aircraft due to the Boeing 737 Max overcharge.
The low airline cost Ryanair is the largest European airline by passenger numbers, which was a big buyer of the 737 Max, buying 75 planes last year, despite the plane standing still for two years due to two fatal crashes.
Most recently, Ryan has been in talks with Boeing over the past 10 months for a new order for 737 MAX 10s, Boeing’s newest and largest single-aisle type of aircraft, as analysts and deal executives have examined how quickly Boeing is catching back orders in the wake of the 737 Max crisis, according to the Wall Street Journal.
Ryanair said on Monday that those talks are over.
“Last week it became clear that the price gap between us and Boeing cannot be bridged and, as a result, the two sides agreed not to waste any more time. in these negotiations, “he said in a note.
The airline explained that without the new Max 10, it still had enough aircraft in its order book to increase its fleet to more than 600 and cover its expansion plans through 2025.
In turn, Ryanair CEO Michael O’Leary confirmed that he would not pursue another deal unless the airline could reach an appropriate pricing agreement with the manufacturer.
The Boeing Max 10 was launched in 2017, with a longer cabin and optional additional fuel tanks, to rival the Airbus A321neo, which has so far dominated the narrow-body market.
The plane made its first test flight in June and is expected to enter in service from 2023, due to the grounding of the Max.
A Boeing spokesperson said Ryanair is a long-term partner. “We value their business and are committed to supporting them. At the same time, we continue to be disciplined and make rational decisions for our customers and our company,” he added.
The US aircraft manufacturer has seen a flurry of orders since the US and Europe lifted grounding operations of the 737 Max. Boeing has booked 630 total aircraft orders through July 31, according to the latest available data. . This includes a massive 200 aircraft deal with United Airlines, including 150 Max 10s.
Meanwhile, excluding recent agreements with Delta Air Lines and Jet2, Airbus has secured a total of 167 aircraft orders since the beginning of the year.
Despite this, Airbus’ market share in the battle between the A320neo and the MAX has exceeded 60%, which analysts and the industry see as a critical threshold for lowering manufacturing costs and lowering prices for customers.
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