Ryanair orders 100 Boeing 737 planes for US$11b

Irish budget airline Ryanair agreed to buy 100 aircraft from Boeing for US$11 billion, with an option to purchase another 100 planes from the aerospace giant, the companies announced on Monday (Sep 8).

The order covers the 737 Boeing MAX 200, which Boeing touts as a fuel-efficient vehicle for the important single-aisle civilian market. The planes will accommodate up to 200 seats, up from the 160 in other single-aisle planes.

Ryanair said the giant order will enable it to meet its growth targets, which calls for it to expand from 82 million customers in 2014 to more than 150 million in 2024, which marks the end of the delivery stream of the planes under Monday's order.

"It's going to change the game for low-fare air travel," Ryanair chief executive Michael O'Leary said at a news conference. "It's also going to change the game in Europe."

O'Leary said Ryanair plans to use the jets to enter new markets in Europe and challenge incumbent carriers. "I hope it will hasten a new era of price wars in Europe over the next 10 years," he said.

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Struggling Cyprus Airways attracts 9 bids: report

Nine firms have made non-binding bids for Cyprus Airways with Ireland's Ryanair and Greece's Aegean Airlines among those still interested in buying the loss-making national carrier, a report said on Thursday (Sep 4) .

There has been no official announcement since the deadline for bids closed on Wednesday but the Phileleftheros newspaper said nine of the 14 firms that had expressed initial interest had tabled proposals. Also still in the running are Israel's Arkia and Spanish Group Arevenca in collaboration with Fly Aruba. But Romania's low-budget Blue Air and Russia's S7 have pulled out, the newspaper said.

Phileleftheros said the interested parties are concerned that Cyprus Airways is paying too much for its six leased Airbus aircraft, while pilot salaries are also deemed too high. It said proposals included making Cyprus a regional aircraft maintenance hub and increasing the Cyprus Airways fleet as it expands.

In August, Ryanair CEO Michael O'Leary met with Cypriot officials and proposed how he could turn Cyprus Airways into a profitable operation by increasing passenger traffic by 500 per cent over three years. He said with the help of his low-cost airline, Cyprus Airways would experience rapid growth, with new routes and more flights, increasing passenger numbers to three million a year from the current average of 500,000.

The debt-ridden government, which is dependent on a €10 billion (S$16.5 billion, US$13 billion) bailout agreed with international lenders last year, owns 93 per cent of the troubled carrier and wants to offload it.

Greece's Aegean Airlines, which has also held talks with government officials, is seen as another serious contender as it aims to use the island's Larnaca Airport as a second base outside Athens. It is understood that among key conditions set for the sale are that the airline remain based in Cyprus and that as many staff as possible keep their jobs.

A shortlist will now be drawn up and those on it given financial data on Cyprus Airways and asked to put in a final binding offer. The government hopes to wrap up the process next month. The airline has been selling off assets, including three time slots at London's Heathrow airport, so it can keep flying.

With a reduced fleet of six aircraft, the airline is struggling to survive against intense competition on its most popular routes to Greece and London. The airline has implemented several cost-cutting plans, axing staff, scrapping routes and downsizing its fleet, but has failed to stem losses.

It is also under investigation by the European Commission for possible violations of state aid rules in a €31 million share capital increase and a €73 million state bailout over the past two years. This is another worry for potential buyers. If asked to give the money back, it would be unable to do so and face certain closure.

Cyprus Airways posted a net loss of €55.8 million for 2012, more than double the net loss of €23.88 million a year earlier.

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Ryanair steps up flights in Italy as Alitalia suffers

Irish low-cost airline Ryanair announced on Tuesday a major increase in the domestic flights it offers in Italy including launching a hub at Rome's Fiumicino Airport.

The expansion comes a day before the deadline for a crucial capital injection into struggling Italian flag carrier Alitalia which has been on the brink of having its planes grounded, but Ryanair said its move should help the airline in its efforts to restructure.

Ryanair announced it will base six aircraft at Fiumicino, Rome's mostly domestic airport, and slowly transfer the flights it had operated from Ciampino airport and increase to nine the number of domestic Italian routes it flies.

The number of aircraft based there could double within a year as it receives new aircraft from Boeing.

Ryanair said it would continue to develop domestic and international flights from Ciampino, the mostly international airport.

Ryanair said its one-way flights on new domestic routes will start at 49 euros ($66) including taxes, compared to 75 euros on Alitalia flights.

Nevertheless Ryanair said this would benefit Alitalia as it would ensure the feeding of passengers into the international flights it operates from Fiumicino.

"Ryanair will guarantee that connectivity to Rome and to southern Italy will be maintained regardless of Alitalia's plans to reduce capacity on domestic routes," said Ryanair's deputy chief executive Michael Crawley in a statement.

The Irish airline said it was willing to cooperate with Alitalia, an offer the Italian company swiftly rejected.

"Alitalia thanks Ryanair for its proposal to collaborate at Rome Fiumicino airport, but we have our own strategy..." said the Italian airline.

A 300-million-euro Alitalia capital subscription expires on Wednesday.

Air France-KLM, which owns a 25 percent stake in Alitalia, has said it won't participate as it believes the restructuring plan put forward by the company won't lower costs sufficiently to make the airline successful.

The Italian government is looking for another major international airline to partner with Alitalia.

The state-owned Italian postal service has been tapped to contribute up to 75 million euros in the capital increase, triggering rivals' allegations of illegal protectionism.

Alitalia says Italian banks are also lined up to lend it 200 million euros.

The airline was already bailed out by taxpayers five years ago in a controversial operation that handed a consortium of private Italian companies a majority stake, part of which was later sold to Air France-KLM.

But it still struggled and racked up losses, with its debt now standing at 1.2 billion euros.

It was nearly grounded last month when Italian energy group ENI threatened to stop fuel supplies because of unpaid debts.

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Ryanair slashes annual profits forecast

Irish no-frills airline Ryanair on Monday slashed its annual profits forecast for the second time since September, blaming the cut on lower fares.

The Dublin-based carrier expects annual profit after tax of not more than 520 million euros (US$701 million), it said in a results statement, which compared with a forecast at the lower end of a 570-600 million euros range given just two months ago.

"We now expect the full year outturn to be between 500 million euros to 520 million euros due entirely to this lower fare environment," Ryanair said in the statement. Ryanair's fiscal year runs to the end of March.

Ryanair added that net profit rose 1.0 per cent to 602 million euros in the group's first half, or in the six months to the end of September, as traffic rose 2.0 percent to 49 million passengers.

"We are pleased to report slightly increased first half profits, particularly against a backdrop of softer fares this summer," Ryanair chief executive Michael O'Leary said in the statement.

Ryanair added that from February it will move to fully-allocated seating on all flights, ensuring that families sit together.

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Ryanair to buy up to 200 Boeing planes

Irish no-frills airline Ryanair has placed an order for up to 200 Boeing planes worth US$18 billion (13.8 billion euros) at list prices, the Irish Independent said on Tuesday.

The order, set to be confirmed by US President Barack Obama and Irish Prime Minister Enda Kenny at the White House next week, is the single-biggest aircraft purchase ever agreed by Ryanair, the newspaper said.

Asked about the report, a Ryanair spokesman told AFP that the airline "does not comment upon, or engage in, rumour or speculation."

The order would be used to replace some existing 737 aircraft, while allowing the carrier to possibly extend its footprint beyond Europe, the paper said.

The report comes as Ryanair appeals a recent decision by the European Commission to block a third attempt by the airline to take over its Irish rival Aer Lingus over competition concerns.

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A big score for Boeing with this huge order from the low cost carrier. With a current fleet size of 305 B737s, it's another strong signal for the aviation world that the low cost business is the way to go. This also signify there will be more jobs for future pilots, and it is good news for those residing in Europe.

Ryanair CEO: 'Seat Belts Don't Matter'

The colorful, attention-loving chief of Ryanair is at it again. The same CEO who suggested installing pay toilets on planes is now revisiting the idea of standing-room-only sections on flights and dissing the safety feature fliers use most.

“Seat belts don't matter,” Michael O’Leary told The Telegraph. “If there ever was a crash on an aircraft, God forbid, a seat belt won’t save you.”

O’Leary is reportedly on a quest to take out the back ten rows of seats on planes so Ryanair can offer tickets for one pound (about $1.60) to budget travelers willing to spend a flight on their feet in a “standing cabin.” The Irish airline is already known for its rock-bottom fares and extensive menu of fees for everything from early boarding to excess baggage.

What about the safety of passengers not buckled in? O’Leary told the paper they could just “hang on to the handle” when necessary and would be “fine,” adding that there’s little turbulence in Europe to worry about. People traveling by subway or train don’t wear seat belts, he pointed out.

"The problem with aviation is that for 50 years it's been populated by people who think it's this wondrous sexual experience; that it's like James Bond and wonderful and we'll all be flying first class when really it's just a ... bus with wings,” O’Leary told The Telegraph.

"If you say to passengers it's £25 for the seat and £1 for the standing cabin, I guarantee we will sell the standing cabin first.”

Don’t count on such a cabin ever showing up on any airline in any part of the world, said Todd Curtis, a former Boeing engineer and founder of AirSafe.com.

“What (O’Leary) was saying about getting rid of seat belts is a non-starter, it’s not realistic, it’s not going to be acceptable to the regulatory authorities,” Curtis told NBC News, adding that he got a chuckle out of O’Leary’s comments.

Seat belts keep passengers safe during turbulence, which can strike unexpectedly and can even happen when the sky appears to be clear, the Federal Aviation Administration says. About 58 people are injured in such bumpy rides each year in the United States while not buckled in, according to government statistics.

The FAA requires fliers to have their seat belts fastened when the plane leaves the gate, as it climbs after take-off, during landing and taxi, and whenever the seat belt sign is illuminated during flight. Airlines also often recommend that you stay buckled in at all times, because you never know when something will happen, Curtis added.

Turbulence isn't always the culprit. In 2008, dozens of passengers were hurt when a computer malfunction sent a Qantas flight into a sudden dive, Curtis pointed out.

Then, there’s the issue of O’Leary’s hypothetical standing-room-only section being located in the back of the plane, which is usually the bumpiest section of the cabin, boosting the chances of passengers losing their balance or falling down, Curtis said.

So while O’Leary may be right that flying has become less glamorous and more routine, air travel safety requirements remain the same, he added.

“The basic conditions under which aircraft fly haven’t changed,” Curtis said. “The need for (seat belts) won’t change.”

O’Leary is known for saying or suggesting controversial things that get lots of publicity for Ryanair. In September, he called passengers who fail to print their Ryanair boarding passes “stupid.” (Read more: Ryanair CEO: 'Stupid' Passengers Deserve Fees)

In 2010, O’Leary suggested getting rid of co-pilots on planes to save money. Then, of course, there was the idea of charging passengers one euro to use the lavatory on flights lasting 60 to 90 minutes.

In 2009, the airline also brought up the notion of collecting a “fat tax” from overweight passengers.

None of those ideas have been implemented.

Despite Ryanair's penny-pinching ways and the outrage it often causes, the airline attracts lots of customers. Earlier this month, it reported a 10 percent growth in profits and a 7 percent boost in passengers for the six-month period that ended in September.

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Hahahaha, he is indeed very colourful and somehow eccentric. What I want to emphasize is that air travel might not be as prestigious as it previously was but safety definitely cannot be compromised. You want it to be affordable but you also want to reach your destination on time and in one full piece.