Ryanair CEO Warns of 10% Increase in Flight Prices Amid Boeing Delivery Delays

Ryanair CEO Michael O'Leary warned that flight prices could increase by 10% this summer due to an aircraft shortage. Boeing's new aircraft deliveries have been delayed, leading to less passenger capacity amid high travel demand. 

New Boeing Aircraft Delayed

Ryanair's passenger numbers will grow lower than expected after the carrier anticipated carrying over 183.5 million passengers between January 2024 and March 2025.  

O'Leary said about the situation: 

"With less aircraft, maybe we'll have to bring that 205 million, we just don't know at this stage. That probably means that even our growth this year is going to be constrained in Europe, and I think that leads to a higher fare environment across Europe for summer 2024. Fares in summer 2024 are going to be up again on 2023. Our average airfare in summer 2023 rose 17%. We don't think we'll see that kind of double-digit fare increase this year. We're doing our budgets based on a fare increase of 5-10%, which to me feels kind of reasonable. It could be higher than that, we don't really know. If capacity was growing, I think fares would be falling."

O'Leary stated that although Ryanair expects compensation, they prioritize delivering the planes first. He said the delivery of 57 Boeing 737 MAX 8 aircraft was due in March, but Ryanair now expects only 40 to 45 jets to arrive before the summer high season. 

Major concerns have occurred about the quality control for the new Boeing aircraft, causing a slowdown in production speed. Boeing has been facing struggles since the January incident when a piece of one of its jets blew out during a passenger flight. The Alaska Airlines flight did not lead to any crucial injuries but concluded in an emergency landing. As a result, O'Leary mentioned that the manufacturer had the U.S. Federal Aviation Administration (FAA) "crawling all over them."

O'Leary added about the prices: 

"Ryanair is a low-cost carrier and so its hikes of 10% are a little bit higher than the average at 3-7% but it is because it is coming from a low base." 

He also added on the issues discussed about the manufacturer, Boeing, as the message he was currently receiving from the company was "confusion" as he described. Although O'Leary repeatedly backed Boeing's top management, he criticized the plane maker's quality control standards. He stated that his idea of removing Ed Clark from the position of boss of the 737 MAX programs was not the right move and that a replacement for Mr. Clark and a new president for quality did not make sense.

O'Leary added about the deliveries and the overall situation:

"If we could get all 57 aircraft deliveries from Boeing in advance before the end of June we would make out like bandits all summer long because we have airports at the moment beating the door down to us."

Meanwhile, a Boeing spokesperson said: 

"We are communicating with customers that some delivery schedules may change as we take the necessary time to make sure that every airplane we deliver is high quality and meets all the customer and regulatory requirements. [We] deeply regret the impact this is having on our valued customer Ryanair. We're working to address their concerns and taking action on a comprehensive plan to strengthen 737 quality and delivery performance."