Ryanair is expected to take up an option to buy a further 100 new generation Boeing 737 MAX aircraft to add to the 100 that it has already committed to purchasing.
Separately, Europe’s largest low-fares airline revealed that it is borrowing €750 million through its third-ever bond issue. The debt must be re-paid in 2023 and will have an interest rate of 1.125%.
Chief financial officer, Neil Sorahan, said that Ryanair had been looking at funding options and chose bonds, as low interest rates made them the cheapest available.
“This low cost finance will enable us to further reduce our aircraft ownership costs while continuing to offer the lowest fares and best customer service through our ‘Always Getting Better’ programme as we grow to 200 million customers per annum by 2024,” he said.
Ryanair is due to start taking delivery of the 197-seat 737 MAX aircraft in 2019. The carrier originally placed a firm order for 100 and took an option to buy a further 100 if required.
Chief executive, Michael O’Leary, speaking in Brussels yesterday, told the Irish Times that the airline had yet to make a formal commitment on the option for the second tranche of 100, but added “we will take them”.
The carrier has until the start of 2018 to decide. If it takes up the option, Ryanair will have a fleet of 520 aircraft once the last of the 737 MAXs are delivered in 2024.
The Dublin-based airline has already dubbed the aircraft a “game-changer”, as it will cut fuel bills by 20%, while carrying 197 passengers, compared to the current 737’s capacity of 189.
News agency Bloomberg suggested that 100 737 MAXs were worth $11.3 billion before discounts