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Boeing gets $9.7B order
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January 24, 2002: 6:30 a.m. ET
Irish budget carrier Ryanair orders up to 150 new Boeing 737-800 aircraft
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LONDON (CNN) - Ryanair, Europe's biggest budget airline, has ordered 150 737-800 aircraft from Boeing, valued at about $9.7 billion.
The airline placed a firm order for 100 737s with an option for a further 50 to be delivered over an eight-year period between 2002 and 2010. Ryanair expects to carry 10 million passengers in the year ending March 2002.
Low-cost airlines -- like Ryanair (RYA), Easyjet (EZJ) and Go -- are expanding their fleets as demand continues to grow, even as traditional national flag carriers cut routes and jobs, and ground aircraft to counter the impact of an economic slowdown and the effects of September 11.
Ryanair and Boeing did not place a value on the order but a Boeing 737-800 can cost between $57 million and 64.5 million, according to catalogue prices. Although analysts expect the airline would have received a discount of about 30 percent for the bulk order.
Boeing won "the order in the face of intense competition from Airbus, and despite many hundreds of offers for second hand aircraft," Ryanair Chief Executive Michael O'Leary said.
The Dublin-based carrier advertised last year for 50 second-hand 737s as it moves to take on Europe's national carriers. It plans to launch flights from Frankfurt, pitching it in a dog fight with Lufthansa, which has said it may consider starting up its own budget airline.
The order would be a welcome fillip for Boeing, which has been forced to shed 30,000 jobs, in its bid to control costs as airline orders decline. Its European rival Airbus won an order for 10 A320 aircraft from JetBlue Airways, a U.S. low-fare carrier, earlier this month.
Airbus is desperate to break Boeings stranglehold on the low-cost aircraft market. Boeing's 737 is currently the aircraft of choice among budget airlines.
EasyJet, Europe's No. 2 budget airline, is in talks with Airbus and Boeing to buy 75 new aircraft. Ryanair and EasyJet are both forecasting annual passenger growth of 25 percent. 
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