Airline says it will have to cut passenger forecasts due to lack of planes, with Airbus also hit by production issues
Business live – latest updatesJulia KolleweWed 16 Oct 2024 14.02 BSTLast modified on Wed 16 Oct 2024 15.17 BSTShareThe bosses of Ryanair and the world’s most influential airline body have sounded the alarm over production issues at Boeing as European airlines struggle with delivery delays.
The International Air Transport Association’s director general, Willie Walsh, said delivery delays from the US planemaker and its European rival Airbus would pose a problem for many years.
“It’s massively frustrating for airline CEOs and it’s having a big impact,” he told an Irish thinktank on Wednesday. “It’s going to be a problem for a number of years to come. The message I get from airline CEOs is the situation doesn’t look like it’s getting any worse, so it seems to have bottomed out or plateaued, but it’s not yet getting better.”
His comments came after Ryanair said it would have to lower its passenger traffic estimates for next year because of expected aircraft delivery delays from Boeing.
The Irish budget airline’s chief executive, Michael O’Leary, said it had been due to receive 20 deliveries before the end of December that were now likely to come in January and February. He said the airline would still have them in time for next summer’s peak travel season.
O’Leary said Ryanair would be doing well if it got 10 or 15 aircraft from Boeing after next March, instead of an expected 30. The Ryanair share price fell by as much as 3.5% after the comments before easing to a fall of 1.7%.
Boeing is grappling with a strike by 33,000 workers that began a month ago, and the persisting fallout from safety fears, prompting the US planemaker to announce a year’s delay to the first delivery of its 777X commercial jetliner and moves to cut 17,000 jobs worldwide.
Its Toulouse-based main rival, Airbus, is also struggling with delivery delays and has been hit by heavy charges in space systems, including OneSat, and delays and rising costs in the defence business. On Wednesday, it announced plans to cut 2,500 jobs – 7% of its defence and space division – by the middle of 2026, after talks with unions.
Air France-KLM said its Airbus A220 orders had been affected by Pratt & Whitney engine issues, while Lufthansa said it had never seen delays like the current ones for the Boeing 777X.
Speaking to Reuters on Wednesday, O’Leary said: “The big issue for Ryanair is we’re due 30 aircraft in March, April, May and June of next year, and how many of those will we get? We’re clearly going to walk back our traffic growth for next year, because I don’t think we’re going to get all those 30 aircraft.”
He said that in his 30 years in the industry he had never seen such capacity constraints. “We want to avoid next year what we had this year. We had geared up, we crewed up the 50 aircraft, and then we only got 30 … We were overcrowded, overstaffed. We took a significant cost penalty this year.”
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About 33,000 Boeing workers in Washington and Oregon went on strike a month ago, halting production of the company’s 737 Max, 767 and 777 jets amid a standoff over pay. Negotiations remain at an acrimonious deadlock.
On Tuesday, Boeing announced plans to raise up to $25bn (£19bn) in a debt and stock offering, plus a further $10bn through a credit agreement with banks, in an attempt to shore up its finances amid the production delays.
It caps a dire 2024 for the planemaker, beginning in early January when a cabin panel blowout during a flight of a new Max jet prompted a fresh crisis surrounding the safety and quality of its planes.
