According to the latest internal circular from Managing Director David O'Brien, Ryanair subsidiary Lauda Europe will use at least ten Airbus A2021s on behalf of its sister company Ryanair DAC from Vienna-Schwechat in the winter flight schedule 22/320. A corresponding agreement has already been concluded.

From Palma de Mallorca, up to five machines of this type will be used in the summer. However, Ryanair has not yet received any confirmation for the winter season. Negotiations are in progress in order to avoid a possible downsizing. In Vienna, David O'Brien sees no prospect of significantly more than ten Airbus A320s for the winter, because both the costs at the airport and the operation of the machine type are said to be high.

Negotiations on the A320neo for Lauda Europe are ongoing

The cover letter also mentions the launch of the first Boeing 737-Max-200 at Ryanair. This aircraft is to be used from Stansted. David O'Brien emphasizes the significantly lower costs compared to the Airbus A320 from his point of view. When asked to quantify these, the manager told Aviation Direct: “Every aircraft that offers four percent more seats, but uses 16 percent less fuel and reduces noise / CO2 emissions by 40 percent, is a game changer. We do not disclose cost comparisons that are commercially confidential. "

Although the Chief Financial Officer of the Ryanair Group recently announced that Lauda Europe is to be converted to the Boeing 737 Max 200, this is not yet completely dry. Contrary to reports to the contrary, intensive talks are still ongoing with the European aircraft manufacturer Airbus.

Lauda has to "work out" new aircraft internally

In his circular, David O'Brien suggests that Lauda Europe must literally earn brand-new aircraft. He does not mention a specific type of machine: “It is crucial that our entire Lauda team maintains our flexibility, efficiency and cost control in order to win as many orders as possible for the winter and, in the longer term, assign new aircraft to Lauda Europe to be able to justify. Our A320 leases expire for the next three to four years ”.

When asked about this, the Lauda Europe and Malta Air boss told Aviation Direct: “Any final decision about the A320 depends on the availability and prices of the Airbus A320 or the leasing rates for the A320 at the end of Lauda Europe's existing leasing contracts. Like Ryanair, Lauda Europe always strives to achieve the lowest flight costs. Lauda must continue to demonstrate the flexibility, efficiency and cost control required to justify new aircraft when the A320 leases expire ”.

O'Brien: "Switching to Boeing is not fixed"

When asked explicitly about the relocation to Boeing planes that was rumored in the media, David O'Brien replied: “The assumption that Lauda Europe will switch to Boeing is not set unless Boeing's aircraft costs are in 2023 or 2024, when the existing A320 leases expire, significantly lower than the cost of Airbus aircraft. A possible change is not fixed, it is still far too early ”.

The vast majority of A320 leasing contracts run in the years 2024 and 2025. O'Brien mentions “2022 or 2023” as the horizon for the decision on the future Lauda Europe fleet. "Any immigration or exodus depends on the costs at which aircraft can be obtained in 2022 or 2023," said the airline boss.

However, should the decision then be made that Lauda Europe should also switch to the Boeing 737 Max 200, the Ryanair Group would have the situation that they would have two Maltese Boeing operators. The operation of Airbus jets (Lauda Europe) and Boeing planes (all other group members including Malta Air) is currently being separated. The question of whether a merger of Malta Air and Lauda Europe would then make sense, believes O'Brien, who is managing director of both Malta subsidiaries, to be far premature. One could talk about that in a few years, if this should happen at all. At least in the medium term, however, there are no such thoughts.

Ryanair is a "seasoned" regular Boeing customer. Due to the takeover of Laudamotion, Airbus A320s were added to the fleet. In the course of the return of the ex-Niki planes leased by Lufthansa, the opportunity to change the fleet to Boeing 737-800s was not used. David O'Brien and Group CEO Michael O'Leary describe the 737 Max 200 as a game changer, but the Airbus A320neo at Lauda Europe still seems to be appealing. But the purchase price has to be right. When asked why the Ryanair Group continues to look at the A320neo, O'Brien replied: "For the Ryanair Group and our airlines, it is interesting to use the cheapest aircraft where we can get them."

Boeing needs Ryanair - Airbus is in a comfortable position

In contrast to Boeing, Airbus is in a completely different situation, because the A320neo has an excellent reputation and has already established itself as a reliable "workhorse". The Max developed into a financial disaster for the Americans, because they also had to pay enormous compensation to major customer Ryanair. It can also be assumed that substantial discounts were granted in the course of re-ordering, which was placed towards the end of the previous year. In short: Airbus can currently afford to forego a large order from Ryanair, but Boeing cannot afford to lose a regular customer at least partially to its European rival. However, the corona pandemic partially reshuffled the cards, because the Europeans also received many cancellations, which at least give other airlines, possibly including the Ryanair Group, opportunities to talk. The aircraft manufacturer finds it cheaper to grant discounts and then to make the production of the machine for a different customer than to cancel it entirely.

The corona pandemic also led to a rethink at Ryanair. Apart from Buzz in Poland, the charter business was downright taboo for many years. You have a Boeing 737-700 that is being marketed as an executive jet, but you have never seriously committed to possible full charter partnerships with tour operators. That should now change and Lauda Europe will be involved.

Lauda Europe landed its first charter orders

O'Brien describes the future role of the A320 operator as follows: “The main task of Lauda Europe is to be a wet lease operator for the Ryanair Group of Airlines. Free capacities, especially during the Covid-19 pandemic, can and will be made available to other airlines and for the charter business. Lauda has already sold several charter flights this summer. ”O'Brien has not yet said which tour operator Lauda Europe will fly for, citing confidentiality. The client must make the announcement.

In Vienna, the group members Buzz and Lauda Europe compete within the group for flight orders from group sister Ryanair DAC. When asked what the purpose of this is and whether it wouldn't make more sense to exclusively use Lauda Europe from Vienna, David O'Brien said: “Lauda Europe is competing in order to be able to get as many orders as possible from Ryanair. The group allocates the capacities and bases and the flight operations compete with each other for existing and new bases ”.

According to the present circular, the Ryanair Group currently seems to be in a very promising position: “Lauda, ​​which operates the least efficient aircraft in the Ryanair Group, is now facing tougher competition in the wet lease business from other group companies. Airlines suspended. We are proud that together at Lauda Europe we have so far demonstrated sufficient flexibility, efficiency and cost control to successfully fly in the wet lease business at the new Ryanair bases in Zagreb and Zadar Having stopped using the Lauda brand, the manager replied: “The Lauda brand is not 'discontinued'. The A320 fleet proudly bears the Lauda brand ”.

Lawsuits for transfer of operations: O'Brien sees no "KV risk"

The predecessor Laudamotion has numerous legal proceedings in Austria, Spain and Germany. Employees are suing for dismissals and, in addition, trade unions in the three countries mentioned have brought actions to establish a transfer of operations to Lauda Europe. Should this be successful in Austria, the “old” Laudamotion collective agreement would apply to the employment relationships of Lauda Europe, according to the Vida union. Incidentally, the "new KV", which was concluded in the previous year with a great deal of turmoil, was never formally finalized, so it never came into force.

David O'Brien sees the risk that the Laudamotion collective agreement could have an after-effect as not given: “Many unions bring many lawsuits, a lot of time. Laudamotion continues to operate and offer services for airlines from its office in Schwechat. Lauda Europe, which has a Maltese AOC, has not acquired or “transferred” any business from Laudamotion or any other airline. Lauda Europe was rebuilt from scratch in mid-2020. "

Malta Air bases its first Boeing 737 Max 200 in Bergamo

The sister company Malta Air will soon receive the first Boeing 737-Max-200 aircraft. With the float, the Lauda group sister also gets its own livery, because so far it has been in the colors of Ryanair. All "game changers", as O'Brien calls them, destined for Malta Air will initially be stationed in Bergamo, Italy. "We hope to receive the first Boeing 737 game changers from Malta Air this summer," said the Malta Air boss. However, not all Boeing 737 Max 200s destined for Buzz or Malta Air will have the new livery. The vast majority will continue to be in the air in Ryanair's colors, according to David O'Brien.

How Malta Air and Lauda Europe will develop in the summer of 2022 and where new bases could be opened, David O'Brien wanted to leave open: “It is too early to speculate how the summer 2022 will develop because of the timing and depends on the speed of Covid recovery and the lifting of Covid travel restrictions ”. The latter cannot be foreseen in view of the experiences from last winter.