View Full Version : Ryan's Boeing discount/easy to go all Airbus?

Brakes to Park
2nd Feb 2002, 01:09
From tonight's Evening Standard:

AIRBUS will have to make budget airline easyJet one of the most generous offers in its history or risk ceding Europe's fast-expanding no-frills short-haul market to its American arch rival Boeing.

The European aircraft manufacturer, which has claimed it is now outstripping Boeing in new orders, has entered the bidding to deliver the new 75-strong fleet that easyJet has said it wants by the end of 2007 to keep pace with major rival Ryanair and grow to a level where it will be competing with European big three British Airways, Lufthansa and Air France.

. .It is understood Airbus came close to making a winning offer to deliver 100 new aircraft to Ryanair but the Stansted-based carrier owned by Michael O'Leary decided last week to stay with Boeing.

. .Aviation analysts at Merrill Lynch say Boeing was so desperate to win the contract that Ryanair may have nailed the Seattle-based manufacturer for discounts of up to two thirds. This means Ryanair is paying just $20m (14m) for each 189-seat next-generation 737-800 priced in the Boeing catalogue at more than $60m.

. .EasyJet chief Stelios Haji-Ioannou said last month that Airbus is in the running to land a contract to supply his airline with enough new aircraft after 2004 to meet its planned 25% a year growth target. Airbus said it would customise its A319 aircraft to seat 150 passengers in a bid to rival the 149-seater Boeing 737-700s easyJet is buying to increase its fleet from 27 aircraft to 48 over the next three years. . .But industry sources believe Airbus will not only have to aggressively undercut the massive discounts being offered by Boeing but also make a very strong case for easyJet to run a mixed fleet of Boeing and Airbus jets with all the extra costs of running two separately trained teams of pilots, cabin crew and maintenance engineers.

. .One insider said: 'Airbus's best hope may lay in nobbling Boeing by offering to take the whole 737 fleet off easyJet's hands so the airline becomes an Airbus-only fleet.'

. .While that could prove ruinously expensive, industry experts recognise budget airlines as the key European growth market for the rest of the decade. The 737-700 and A319 have list prices of about $50m but catalogue guides are now largely irrelevant as the big two manufacturers slug it out to win new orders.

2nd Feb 2002, 01:40
So from "Evening Standard".. :

"where it will be competing with European big three British Airways, Lufthansa and Air France"

Please note that the three big ones are nicely written down in a decreasing order of recent business losses, to please the nationality of the "Evening standard" readers.....

Buster the Bear
2nd Feb 2002, 01:47
14 million for each 737. Bargain! MOL wins again if it is true!

2nd Feb 2002, 02:00
If easyJet chooses Airbus it will probably be the beginning of the end of the low-cost airline.

The business plan of easyJet is more fragile than Ryanair because they chose to operate from main airports and for this reason its costs are very high. Moreover it will be difficult to grow 25% per year with 'slots war' in Gatwick, Amsterdam, .... The strategy of easyJet is not as clear as Ryanair which chose to base its competitive advantage on prices. And if you add the costs of the mixed operation of two different aircraft or the change in a all-Airbus fleet it will be very very difficult.....