Limited shares hit for Ryanair from 737 Max grounding

The airline industry worldwide needs the grounded Boeing 737 Max airline to start flying again but shares in Ryanair which planned to be a large customer of the plane are unlikely to be damaged any time soon, a leading analyst has said.

Shares in Boeing took a further hit after the US airplane maker postponed building more 737 Maxs until regulators give the go-ahead for its return after two fatal crashes.

The largest users of the Max, including Southwest in the US, German travel giant TUI, and Norwegian Air have been heavily disrupted by the worldwide grounding of the 737 Max.

Southwest Airlines won’t schedule any flights on the 737 Max jets until April 13 — more than a month later than previously planned — further clouding the outlook for the best-selling aircraft.

Southwest’s decision follows that of American Airlines, which said last week that it is removing the 737 Max from flight schedules through early April, extending the plane’s absence from the skies for more than a year.

Southwest had previously said it anticipates a month or more of preparations after the Max wins approval to fly from the US Federal Aviation Administration. United Airlines plans to resume service with the jet in early March.

Ryanair has scaled back for orders but shouldn’t be affected by its grounding any time soon, said Stephen Furlong of Davy.

For Ryanair, Mr Furlong said that investors are looking at the problems of the 737 Max as a short term effect that slows the airline’s growth plans, adding, however, that is was “imperative for the worldwide airline industry that the 737 Max returns”.

Ryanair shares are up from its 2019 lows hit in September but have nonetheless fallen by around 35% in the past year as the airline struggled to compete with overcapacity in Europe.

Regulators halted Max flights worldwide after an Ethiopian Airlines jet plunged into a field on March 10, following a Lion Air flight that crashed off the coast of Indonesia five months earlier. The disasters combined killed 346 people and prompted the longest flying ban for a US airliner.