A Boeing 737 MAX 10 airliner takes off for its first flight at Renton Municipal Airport on June 18, 2021 in Renton, Washington.
Stephen Brashear/Getty ImagesCommercial aerospace giant Boeing might have a new problem—the Airbus A321.
Ryanair (ticker: RYA.Ireland) CEO Michael O’Leary took a shot at Boeing (BA) after the pair failed to reach an agreement on a 737 MAX 10 order.
“We are disappointed we couldn’t reach agreement with Boeing on [an order],” said O’Leary in a Ryanair news release. High pricing was the reason cited.
“We do not share Boeing’s optimistic pricing outlook, although this may explain why in recent weeks other [Boeing customers] have been placing new orders with Airbus, rather than Boeing,” the CEO said.
Boeing wasn’t immediately available to comment. Pricing negotiations, however, aren’t something the company typically comments on. Boeing stock is down about 0.9% in premarket trading. S&P 500 and Dow Jones Industrial Average futures were slightly in the green.
Ryanair operates more than 450 737-model aircraft. It also operates about 29 Airbus (AIR.France) A320 aircraft. The 737 and A320 compete with one another. They are similar size.
The 737 MAX 10 is the stretch, or longest version, of the MAX. It isn’t in the air flying commercially yet. The MAX 10 is about 144 feet long—about 30 feet longer than the shortest version of the MAX. The extra length means more passengers. A MAX 10 can seat up to 230 people.
The longer version of a family of jets always has the best operating costs.
“Stretching an airplane in a family, you always end up with the airline’s favorite version,” said Credit Suisse analyst Robert Spingarn. “Which is why the A321 is more appealing right now than the A320.”
The A321 NEO is the longer version of an A320. It’s about 146 feet long and will compete with the MAX 10. Deliveries of the A321 began at the end of 2019.
The MAX 10’s first flight was earlier in 2021 and Boeing hopes it will enter service in 2023. United Airlines (UAL) has ordered MAX 10 jets.
O’Leary might, of course, just be playing hardball after Boeing’s difficult years. The MAX was grounded worldwide between March 2019 and November 2020 following two deadly crashes inside of five months. And O’Leary has spoken glowingly about MAX jets in the past. But pricing always seems to come up.
“Our new Boeing 737 Gamechanger aircraft will reduce our fleet cost and our unit costs, thanks to the very attractive pricing we negotiated with Boeing,” said O’Leary on a June conference call. Gamechanger is how O’Leary refers to the MAX. “These aircraft on this fleet will lower our unit costs for the next decade,” added the CEO.
Pricing negotiations can be hard and right now it looks like Ryanair is the one dealing from a position of strength.
Coming into Tuesday trading, Boeing shares have risen just 2% so far in 2021. The company is digging out of the dual problems of the 737 MAX grounding and the global pandemic which has hurt demand for air travel.
Write to Al Root at allen.root@dowjones.com
"Max" - Google News
September 07, 2021 at 08:27PM
https://ift.tt/2YDQnPL
What Is Boeing's MAX 10 and Why Is (or Isn't) Ryanair Backing Away From It? - Barron's
"Max" - Google News
https://ift.tt/2YlVjXi
Bagikan Berita Ini
0 Response to "What Is Boeing's MAX 10 and Why Is (or Isn't) Ryanair Backing Away From It? - Barron's"
Post a Comment