Ryanair CEO dishes advice to Boeing on managing its crises: ‘Never put a pilot in charge of an airline’
04/26/2024 06:07Ryanair and Boeing have shared a close and complicated relationship over the years, but the discount airline continues to lean heavily on the manufacturer.
Boeing has weathered passenger deaths in its planes, ongoing safety emergencies, an FAA investigation, frequent Senate hearings, and rocky finances that have contributed to CEO Dave Calhoun announcing he will step down from the company at the end of the year. Ryanair CEO Michael O’Leary shared some words of wisdom on how the aircraft manufacturer should navigate the future of its management.
“The best CEOs and owners are the accountants, the people who do the boring, repetitive, day-to-day delivery, and that’s what you need,” CEO Michael O’Leary told Bloomberg on Wednesday. “They already design great aircraft—you’ve got to make them, but you’ve got to make them on-time and within budget, and that needs accountants.”
He added that so-called accountants have clarity on the vision of a company, while personnel like engineers can lose sight of an overall mission in favor of tweaking what’s not broken.
“It’s like, never put a pilot in charge of an airline,” he said. “They want to buy new shiny toys.”
Boeing is experiencing the aftershocks of the Jan. 5 Alaska Airlines flight emergency that saw a door plug fly off a 737 Max 9 aircraft. The incident, as well as the plethora of others that shortly followed, prompted an FAA investigation yielding the exposure of dozens of problems, as well as whistleblowers from the company emerging, alleging that the company retaliated against them for speaking out against safety and manufacturing hazards. Boeing reported a $355 million first-quarter loss on Wednesday, a better-than-expected result. Calhoun assured investors in its Wednesday earnings call that the company is slowing down to focus on safety first. Following FAA’s findings, the company is planning to revamp its safety and quality protocols to align with the regulatory body’s recommendations ahead of a May 28 deadline.
Despite the aircraft manufacturer beginning its slow journey to recovery, Ryanair is already beginning to see results. The discount airline, whose fleet is made up almost entirely of Boeing planes, now expects to receive 40 aircraft from Boeing in time for its busy summer season, up from the 35 previously expected. That’s still quite a few planes short of the 57 Boeing was contracted to provide Ryanair. Ryanair still projects being able to fulfill its goal of carrying 200 million passengers over the next 12 months, but the airline will still have to raise fares to make up for the plane shortage.
O’Leary has good reason to continue to support the manufacturer. Ryanair is the primary recipient of Boeing’s 737-8-200 model, a large, high-density plane that offers a cost-saving solution, allowing Ryanair to compete with airline juggernauts. O’Leary dubbed the aircraft, designed specifically for Ryanair, the “Gamechanger.”
O’Leary shared in the Bloomberg interview that he has frequently spoken with Boeing chief operating officer Stephanie Pope, on the short list to help the company following Calhoun’s departure, about the company’s progress on producing and delivering new plans.
“She’s focused now on getting the head down in Seattle, getting the aircraft delivered,” he said. “We’re seeing optimistic signs.”
Boeing and Ryanair did not immediately respond to Fortune‘s requests for comment.
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O’Leary hasn’t always had so much confidence in Boeing. In fact, he had choice words for the company in May 2022. Following a public pricing dispute over a potential aircraft order, as well as Boeing’s significant delivery delays, O’Leary said the company needed to get its “sh-t together.”
“At the moment we think Boeing management is running around like headless chickens, not able to sell aircraft, and then even the aircraft they deliver, they’re not able to deliver them on time,” he said.
But Ryanair has also been a loyal Boeing customer, even as the manufacturer was navigating other pockets of scandal and tragedy. In December 2020, following 2018 and 2019 Boeing plane crashes that killed 346 people, Ryanair bought 75 Max jets, Boeing’s biggest order since the disasters. Weeks after the Alaska Airlines grounding, Ryanair offered to buy up airlines’ unwanted 737 orders.
“If United Airlines wants to delay or cancel any of their Max Boeing 737 orders, Ryanair would be very happy to take them,” O’Leary said.
The CEO has been vocally sympathetic to Boeing since and said Wednesday that Calhoun has been burdened with the challenging task of not only building and distributing airplanes, but in having to navigate the ample regulatory pressures the company has faced this year.
“I’m sorry to see him go at the end of the year,” O’Leary said.
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