Has Ryanair reached its zenith or does O'Leary have doubt about that the ExMax is the future

He recently announced that he had plenty of time before any further 737 orders where forthcoming saying that another world shock disruption would have to come first so he could again get preferential pricing.

The ExMax was never such a gamechanger that Ryanair has been spreading about. 10% more seats than the 737-800 and slightly more effective engines do not give enough green credentials that it impresses any politician when everybody is dreaming about electric planes. And for Ryanair shareholders its just a few percentage points more potential profit for an increasingly short timeframe until something more drastically have to happen about the future of flying. Unless transport of people by air is to go into a permanent decline at the hands of the climate change brigade.

It could also be that Ryanair has reached the long touted optimum sice of aircrafts, round 200. They are dividing into not only more marketing names but operations to. Or that the current top management have run out of steam, entusiasm and ideas after 25 years at the helm. And that goes for Wilson to. 

Comeback from CoVid19 is neither so fast as they had hoped and they might start to suspect that government restrictions is not going to be the problem in the next couple of years rather than the general publics lingering fear. As I have said before the 25 to 40% of the populous that don't care about danger and travels anyway are not going to be enough to fill the Ryanair fleet to above 90% capacity.


It's very doubtfull O'Leary actually meant he was hoping for another downturn. Gaining an extra 10% discount on renewing lets say a quarter of the fleet = 100 planes, would take a long time to make up for a 9/11 or CoVid19 like 2 years of disruption. That kind of events are more to the advantage of upstarts and not the encumbent that Ryanair have become. One can't benefit from power by the hour contracts on planes one already owns.

More likely Ryanair have seen a more permanent disruption to its core markets. After Brexit they can now longer expect to fly several million eastern european workers to he UK. Or backwards and forwards for every holliday and family event. And if working from home becomes a permanent thing the tens of thousands long commuters to Ireland might not either come back in a major way. Holliday travels to the beach or the snow is not going to make up for that. And Wizz failed attempt on Norway will scare other low costs away from expanding much in the Nordic markets. 

That leaves Ryanair waiting for new trends to emerge hence we could see a reduction in its total fleet size in the coming years. Possibly leading to a permanent long drawn out decline, unless new brooms with new ideas come in at the very top.

 

Comments

Post a Comment

Popular posts from this blog

Is this the endgame for Norse, not necessarily

Norse have again announced that they need another capital injection. This time it might be different because last time they needed money the ceo and large owner Larsen said that it was the last time he injected more from own funds. Thi reminds me of the endgame ein Flyr where major investor Braathen said something similar in the autumn. When they agin needed money the following Januar nobody came forward and that was the end for an airline that could have been saved after the October refill with some major mangement changes that could have implemented even stricter cost savings, found income immediately and not paid out cash  immediately for possible charter incomes in the future. If Norse turns to more subleasing out of planes or charters they need to ensure that there will be upfront payments because it will mean upfront costs. Difficuolt concept for underfinanced charterers but rquired for an airline on the brink. Norse management also need to be based closer to where the action...
Read more

When will Boeing's new chief get around to solving problems instead of letting new ones happen

So far the new Boeing CEO is not standing out as a problem solver. His first couple of months has more been a deepening of the Boeing rut. Maybe his immediate and well announced (partial) relocation to Seattle was not such a smart move after all. It certainly have given the machinists the guts to demand back stuff they gave up 10 years ago because Boeing then threatened to move more production away from the area. He needs to be careful with letting his division leutenants run the show by playing hardball with the unions at a time when Boeing needs to ramp up production, not let it grind to a halt altogether. They may have more experience from within Boeing and been seen by the previous CEO as leading lights but it is time for a new regime. The previous one created and proeeded with more trouble than it was worth for both customers and the company itself. Boeing might be too critical to the for all practical purposes duopoly in passenger plane making in the western world, but that deepl...
Read more

Questionmarks over how Boeing saved costs when using plug instead of door

 What on the overwing exits stop them physically from being opened by a passenger with poor survival instincts during flight and did Boeing design engineers remove this safety mechanism from instructions for when installing a plug instead of a door. What other safety features did they omit on the grounds of cost saving in the design for using a door plug instead of a real emergency exit.  Normal cabin doors can't be opened during flight by design since they swing forward into the wind. There are few comments around on how this door (when installed) pivots. Is it up like the overwing exits or is it down since with such a small door there are probably no self inflating slide like the normal cabin doors. Or is it left or right. On the 737-200 the emergency exit overwing door came out loose and into the cabin. On the 737-NG-800 they swing up and out of the way. I doubt it just is pushed out and fall down because that could damage it during testing / maintenance. Would the overwing...
Read more