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posted 12/18/09 11:44 AM | updated 12/18/09 11:44 AM
Featured Post! | Views: 99 | Comments : 0 | Business

Boeing Not Desperate Enough for Ryanair's Budget

By Michael van Baker
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As the PSBJ reports, Ryanair has walked away from an order of 200 Boeing 737s, an order that would have more than doubled the size of the Irish budget airline's fleet. It's not exactly a crushing blow for Boeing, since "The airline added Friday that its decision won’t affect its delivery of 112 737s in the next three years."

Seattlepi.com quotes Ryanair CEO Michael O'Leary as saying, "We have no plans to reopen discussions with Boeing or any other aircraft manufacturers," which lends credence to the view that Ryanair is rethinking its breathless rate of expansion. That is the subtext in Bloomberg's story on the jet deal, which would have been worth around $14 billion, according to the Financial Times.

Bloomberg quotes analysts who point out that with over 100 737s on the way, Ryanair is in no pressing hurry to make a deal if it thinks the market for planes might dip further during the recession. In fact, Boeing and Ryanair had agreed on the price, but Ryanair was demanding unnamed "contractual terms and conditions" that Boeing balked at adding.

O'Leary had one card left to play this hand--How much was it worth to Boeing not to "lose" one of the largest deals in commercial airplane history? Not enough. They'll shuffle the cards and start over.

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Tags: 737, boeing, ryanair, michael oleary, budget, deal, jet + add tags
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