Ryanair Order for 300 Jets Boosts Boeing's Uncertified 737 Max 10

Irish low-cost carrier Ryanair, the largest airline in Europe, on Tuesday announced an order for up to 300 Boeing 737 Max 10s, adding to growing sales momentum — despite Max production faltering last month because of supply chain quality problems.

The deal includes 150 firm orders and 150 purchase options to be delivered between 2027 and 2033. It's likely all 300 will be delivered, as Ryanair — Boeing's largest customer outside the United States — has historically taken delivery of its full quota of options.

As post-pandemic air travel demand grows rapidly worldwide, Boeing's sales win follows large recent orders from United Airlines, Air India and two carriers owned by the government of Saudi Arabia.

The Max 10 is the largest Max model and though not yet certified to fly passengers it has now amassed nearly 1,000 orders.

This variant has additional safety measures installed that will be retrofitted later to all Maxes, and the Federal Aviation Administration and overseas regulators are rigorously scrutinizing those changes during the certification process.

That has pushed the aircraft's formal approval to fly passengers into late next year at the earliest.

Announcing the deal at Boeing headquarters in Washington, D.C., Ryanair chief executive Michael O'Leary bantered as he sat beside Boeing CEO Dave Calhoun about the jets being too expensive.

"We got screwed by Calhoun again," he said, laughing.

O'Leary has always haggled over price but is positioned to obtain the largest discounts possible.

Last year, he publicly criticized Boeing in what he termed "a bit of a bust-up ... over pricing."

Yet he said the terms of the deal came together quickly after negotiations started in earnest in January.

"We've had to move somewhat to get this deal done today, but I think it's a bit like a marriage," O'Leary said Tuesday. "We have occasional rows and occasional splits, and we come together and kiss and make up."

Market pricing data from aircraft valuation firm Avitas suggests the total order is worth around $17 billion after discounts.

Calhoun said the pricing terms are beneficial to both sides, so that "Michael can grow and Boeing can prosper."

He praised Boeing's lengthy relationship with Ryanair, expressing particular appreciation of how O'Leary chose to exercise purchase options for 75 Maxes in December 2020, at the height of the COVID-19 crisis in aviation, as soon as the Max was cleared to resume flying.

Supply chain struggles hamper production

News of the big sales win comes as Boeing struggles with supply chain issues that have severely curtailed Max production in Renton, Washington.

The latest came mid-April when Boeing's major 737 supplier, Spirit AeroSystems of Wichita, Kanson, found a hidden defect in the vertical tail that dated back to planes built since 2019.

Two of eight fittings that attach the jet's vertical tail fin were found to have been produced with "a nonstandard manufacturing process" that doesn't meet the required specification.

The defect is not an immediate safety issue as the other six fittings are more than enough to secure the tail.

However, all planes previously delivered with the defect may have to have the tail fixed at their next heavy maintenance check. And Boeing has slowed production to fix the planes now in production.

As a result, last month, Boeing delivered just 17 Maxes, down from 52 delivered in March and the lowest delivery total since August of 2021.

O'Leary said Ryanair expects a two or three month delay in projected near-term aircraft deliveries.

"We will have to take some seats out of our schedule in May, June and the first half of July," he said. "But it's reasonably small. It will not have any material effect."

And O'Leary expressed "a high degree of confidence" that by 2027 when the first of his Max 10s is to be delivered, Boeing will be back on track.

"I have no doubt that by the time we get to 2027 to 2033, all of these aircraft will deliver on time," he said.

Calhoun said that while the discovery of the flaw in the vertical tail was disappointing, the way in which Boeing was swiftly alerted points to a strong safety culture.

Once the tail was assembled, the fittings in question could not be inspected.

"This particular defect was pretty gnarly and most definitely hidden on the airplane," he said. "Not even our nondestructive test equipment could get us to that."

"The good news is that somebody did witness it — admittedly late and none of us are happy about it, including our friends at Spirit," he added. "But when they did, they raised their hand, and we immediately found it, looked at it, reviewed it with the FAA, evaluated it and put the fix in place."

"I will characterize it as a strength in culture and a strength in the willingness of an individual to raise their hand," Calhoun said. "And I will ask anybody in our supply chain to do the same."

He said Boeing is focused on stabilizing the supply chain and raising the production rate from about 31 jets per month now to 50 per month over the next several years.

With that target in mind, Boeing is opening a fourth Max assembly line in Everett next year to add to the three lines in Renton.

Ryanair aims to expand aggressively

Ryanair's growth plans are staggering.

The airline now has a fleet of about 540 Boeing 737s, a combination of older 737 NG models with 189 seats and the high-density Max 8-200 model with 197 seats. It has previous orders for more than 100 of that latter model still pending delivery.

O'Leary said Ryanair will configure the new Max 10 variant with 228 seats, which he said will yield higher revenue, fuel planned expansion and allow Ryanair to better compete with European airlines flying the 230-seat Airbus A321neo.

"It would be very difficult for us going forward in Europe in the next decade if we were trying to compete with a 230-seat Airbus aircraft with a 197-seat Boeing aircraft, no matter how great that aircraft is," he said.

"I believe the Max 10 is a better aircraft than the A321," he added. "We will be beating Airbus competition all over Europe for the next decade."

He said Ryanair plans to expand beyond Europe, introducing flights to Morocco, Israel, Jordan and Egypt.

And he offered strong support to Ukraine, saying that as soon as that country repels the Russian invasion and it's safe to fly, Ryanair will be the first airline back in business there.

With this new 300-jet order, of which 150 planes are to replace older aircraft and 150 are for growth, O'Leary said a decade from now Ryanair should have a fleet of 800 all-Boeing jets.

"You keep building them, and we'll keep buying them," O'Leary told Calhoun.

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