Ryanair wants to defy its “traumatic” corona loss. The airline is ready for the expected holiday rush – and is negotiating a major deal.
NAfter a record loss due to the corona pandemic, Europe’s largest low-cost airline Ryanair sees the aviation industry back on the road to recovery. Company boss Michael O ‘Leary referred on Monday in the BBC to the recent significant increase in bookings, the relaxation of corona-related travel bans and the imminent first delivery of the Boeing 737 Max. The Irish airline is currently negotiating a major deal with the US aircraft manufacturer for the long version, the 737 Max 10.
The low-cost airline got through the crisis relatively well, as analyst Jack Winchester said. Ryanair is ready to stimulate the expected high demand for vacation abroad. O’Leary admitted a historical minus, however. “It’s better than we predicted, but still a pretty traumatic loss for an airline that has been consistently profitable in our 35-year history,” he said.
The bottom line was a loss of a good billion euros for the twelve months to the end of March after a profit of 649 million euros a year earlier, as the company announced in Dublin. The minus was 815 million euros, if one excludes a special charge due to ultimately worthless fuel price hedging transactions. A good 27.5 million passengers meant a decrease of 81 percent.
Hopes for the second half of the year
Company boss O’Leary passed the buck on the European governments. Customers and employees alike suffered “from ever changing government guidelines, travel bans and restrictions”. With reserves of three billion euros, the company feels that it is well equipped and now wants to benefit from the expected strong recovery in the travel industry.
Ryanair is very confident for the months ahead, said O’Leary. The number of bookings tripled from 500,000 at the beginning of April to 1.5 million per week. Then there is the progress of the vaccination program. Most Europeans could be vaccinated by September, O’Leary said. At Ryanair, as with other airlines, this raises hopes for a strong second half of the financial year from October to March 2022.
Customers could benefit from low prices this summer, said O’Leary and the head of the British low-cost line Easyjet, Johan Lundgren. This is due to short-term bookings and special offers for the restart of the industry. However, the picture could change in 2022 if the corona situation has improved. Then fewer seats would be available, also because some airlines would not survive the corona pandemic economically.
„Gamechanger“ 737 Max
Ryanair, on the other hand, wants to expand. The Boeing medium-haul jet 737 Max, of all things, is supposed to contribute to this.After a two-year flight ban due to two crashes with a total of 346 deaths, it is now allowed again. The machine is a “game changer”, said O’Leary and referred to more space with lower kerosene consumption. Ryanair is hoping for a first delivery before the summer business starts, and 60 jets should be ready for use by mid-2022.
O’Leary was seriously disappointed by Boeing and accused the US group of mismanagement. The largest European Max customer – a total of 210 machines have been ordered – nevertheless relies on the aircraft manufacturer. For the renewal and expansion of the fleet between 2026 and 2030, the Irish want to order numerous jets of the long version 737 Max 10. CFO Neil Sorahan didn’t want to comment on how many planes are involved. But he emphasized: “We don’t tend to make small deals.”