Ryanair threatens to dump Boeing

2 November 2009

02 November 2009 | Jake Kanter

Irish airline Ryanair has threatened to ditch supplier Boeing if it fails to pass on cost reductions.

Speaking as the company unveiled its half-year results today, chief executive Michael O'Leary said little progress had been made in negotiations for an order of 200 aircraft to be delivered between 2013 and 2016.

If the discussions are not completed before the end of the year, he said Ryanair would end its relationship with Boeing and confirm a "series of order deferrals and cancellations".

"We see no point in continuing to grow rapidly in a declining yield environment, where our main aircraft partner is unwilling to play its part in our cost reduction programme by passing on some of the enormous savings which Boeing have enjoyed both from suppliers and more efficient manufacturing in recent years," O'Leary said in the statement.

A Boeing spokesman said the company does not comment on negotiations with customers.

Ryanair's net profits increased 80 per cent to ?387 million (£349 million) for the six months to the end of September, driven mainly by a 42 per cent fall in fuel costs. O'Leary said the firm's "relentless" focus on costs was delivering savings.

SMnov2009

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