Ryanair plans a spending spree as credit crunch bites

Feb 4 2009 by David Jones, Liverpool Daily Post

BUDGET airline Ryanair is negotiating with Airbus and rival American aircraft manufacturer Boeing about buying 400 short-haul aircraft, one of the biggest orders ever placed by a carrier anywhere in the world.

Ryanair, Liverpool John Lennon Airport’s biggest carrier, says it will take advantage of any decline in aircraft prices if the global slump in air travel results in a fall in demand for passenger jets.

Airline deputy chief executive Michael Cawley said the Dublin-based carrier currently operates a fleet of 181 Boeing 737-800 aircraft and is considering ordering more of that type or Airbus A320 and A321 planes.

Earlier this week, Ryanair said it expected to reported better-than- expected full-year profits, despite high fuel prices hitting profits in its third quarter.

Wing-equipping operations for Chinese-assembled Airbus A320 jets are to start later this year, but the aircraft manufacturer is pledging the deal will not undermine jobs at its Broughton wingmaking site, near Chester.

Airbus China's Xian Aircraft Industry (XAC) has formally signed an agreement for it to finish and test wings destined for A320 aircraft at a new factory in Tianjin, in north eastern China.

XAC currently assembles wingbox structures for the A320 in China before transporting them to Broughton for completion.

Now the wing-equipping operations, currently based at the Broughton site, are to transfer to China, but only for up to four aircraft a month, Airbus parent group EADS told LDP Business.

The fully equipped and tested wings will be delivered directly to the nearby Final Assembly Line China (FALC).

Airbus has also signed a deal with Chinese partners to make carbon-fibre composite parts in China for the A320 and the company’s latest model, the fuel-efficient extra wide-bodied X350 XWB.

The company plans to deliver its first Chinese-assembled A320 jet to Sichuan Airlines in June or July as part of its bid to compete with Boeing for orders in the world's second-largest aviation market.

The Tianjin aircraft assembly plant, a joint venture between Airbus and a Chinese consortium, is expected to deliver 11 jets this year, more than 20 jets next year and 48 by 2011.

An Airbus spokeswoman said of the deal with XAC: “It is a transfer of some work currently carried out at Broughton, but it will have no impact on employment levels at the Welsh site.

“Broughton currently produces 36 wings sets a month, but as the work in China is ramped up to four aircraft a month by 2011, that will fall to 32.

“Broughton is and will remain the company’s centre of expertise for wing manufacture and equipping, and the work in China will be done under its control.

“A small team of about 10 managers from Broughton will oversee the industrialisation of wing equipping in China before returning home.”

RYANAIR carried 4.08m passengers last month, an 11% increase on the 3.68m seen the previous January. The Irish airline said the load factor, the number of passengers in proportion to available seats, remained the same at 69%.

davidrjones