Ryanair, Europe's largest low-cost airline, has struck a landmark multi-billion-dollar deal with Boeing to purchase hundreds of the manufacturer's most popular jets, marking a significant expansion of the Irish airline's fleet and a sign of confidence in the travel industry's recovery.
The companies announced Tuesday that Ryanair placed its largest order in company history for 150 of Boeing's 737 Max planes, with an option to buy 150 more. If Ryanair exercises the option, the deal would be worth more than $40 billion and nearly double the airline's fleet.
Ryanair CEO Michael O'Leary said the order will save the company a fortune in operating costs, providing more room for growth and lower prices for travelers.
"In addition to delivering significant revenue and traffic growth across Europe, we expect these new, larger, more efficient, greener, aircraft to drive further unit cost savings, which will be passed on to passengers in lower air fares," O'Leary said. "The extra seats, lower fuel burn and more competitive aircraft pricing supported by our strong balance sheet, will widen the cost gap between Ryanair and competitor EU airlines for many years to come."
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After announcing a delay in production due to a parts issue last month, the deal for Boeing is a sign of confidence in the company's future as it recovers from the COVID-19 pandemic. Boeing has also received large orders in recent months from Delta Air Lines, United Airlines and Air India.
Additionally, the deal will offer a boost to the European economy, which has been pinched by record high inflation.
"This order, coupled with our remaining Gamechanger deliveries, will create 10,000 new jobs for highly paid aviation professionals over the next decade, and these jobs will be located across all of Europe’s main economies," O'Leary said.
The deal still has to gain approval from U.S. regulators, but Boeing CEO David Calhoun said the company hopes to gain authorization from the Federal Aviation Administration by sometime next year.
"The Boeing-Ryanair partnership is one of the most productive in commercial aviation history, enabling both companies to succeed and expand affordable travel to hundreds of millions of people," Calhoun said.
Ryanair expects to receive the new jets by 2033 and O'Leary said it will nearly double the company's passengers to 300 million a year by 2034.
