Ryanair (FR/RYR) will give Boeing an order for 75 more Boeing 737 Max 8 200s as part of a deal with the plane maker over compensation for the delay of its original Max order according to sources close to the deal.
The deal will bring Ryanair’s 737 Max order up to around 210 units with its first deliveries expected early in 2021.
Ryanair has been negotiating with Boeing, which has lost multiple Max orders, for compensation because of delays to the aircraft caused by the grounding of the type in 2019 after two fatal crashes.
The aircraft has undergone a series of upgrades and rigorous testing ahead of its return to flight.
But now the Max is cleared to fly again in Europe it puts the Irish budget airline in a strong bargaining position.
The list price for each 737 Max 8 200, a high-density version of the Max 8, is around £93m but sources have suggested Ryanair may be getting a discount upwards of 60% as it is in lieu of financial compensation payout.
The deal is certainly badly needed by the Seattle-based plane maker which went from a multi-billion dollar profitable company to one posting a $630+ million dollar loss in just 12 months largely due to the grounding of the 737 Max.
The deal is expected to be formally announced shortly with Ryanair officials expected to fly to Seattle to seal the deal.
As Ryanair is an Irish airline it is also being hit by the new tariffs on aircraft from Boeing that were recently announced.
It means a 15% penalty will be levied on all Boeing aircraft imported into the EU.
Ryanair does have a UK subsidiary of course which could allow it to avoid the EU tariffs.