January 28, 2020 / 1:40 PM / 20 days ago

Ryanair warns of more job losses as 737 MAX delivery date slips

DUBLIN (Reuters) - Ryanair (RYA.I) has warned pilots it may have to cut more jobs and close bases because the delivery date for its first 10 Boeing 737 MAX jets has slipped into the autumn.

FILE PHOTO: Ryanair Boeing 737-8AS plane EI-EKG lands in Riga International Airport in Riga, Latvia January 17, 2020. REUTERS/Ints Kalnins

The Irish airline had originally planned to fly 58 of the jets this summer but has gradually cut that number since the MAX was grounded after two fatal crashes and Boeing (BA.N) struggled to secure approval for its re-entry to service.

Ryanair last July announced it had 500 more pilots more than it needed, in part due to MAX delays, but it has not announced how many jobs it has cut to date. The airline last year had around 5,500 pilots for a fleet of 475 aircraft, according to the company’s annual report.

Moves to cut staff have caused tensions with unions, with some union officials accusing Ryanair of targeting unionised bases or shifting capacity into its non-unionised subsidiary Buzz, allegations Ryanair has denied.

Boeing said last week it did not expect the MAX to return to service until mid-2020 and, given Ryanair does not take deliveries during its summer peak of June-August, it will not have the first 10 MAX planes until the autumn.

In a memo dated Jan. 27 and seen by Reuters, the low-cost airline said Boeing would not now deliver the first of the grounded model until September or October at the earliest.

As a result it will have to cut 10 aircraft from its summer roster, which could result in job losses for pilots and cabin crew, as well as possible base closures.

“I have asked our commercial team to work up their proposals for these 10 aircraft reductions in summer 2020, and I hope to have their final recommendations over the next week,” Chief Executive Eddie Wilson said in the memo.

“We will do our best to avoid any more base closures, but this will mean eliminating at least 10 aircraft from existing bases, and so further pilot and cabin crew jobs losses cannot be ruled out.”

The 737 MAX, Boeing’s fastest-selling aircraft, was grounded last March after 346 people died in two crashes attributed to anti-stall software.

Ryanair, one of the biggest MAX customers, with 210 on order, said earlier this month it hoped up to 10 MAX jets might be delivered in March or April.

With Boeing rival Airbus (AIR.PA) also experiencing production backlogs, industry experts say airlines with large MAX orders have no cost-efficient way to source dozens of alternative jets at short notice.

Asked for comment, Ryanair told Reuters it had “nothing further to add to the memo”.

Reporting by Conor Humphries; Editing by David Goodman and Mark Potter

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