Business

Boeing crisis reverberates in Dublin and Belfast a year after Max blow-out

Ryanair unlikely to get its new planes by 2025 summer peak, but investors believe it won’t be blown too much off course

A panel used to plug an area reserved for an exit door on the Boeing 737 Max 9 jetliner blew out on the flight (National Transportation Safety Board via AP)
A panel used to plug an area reserved for an exit door on the Boeing 737 Max 9 jetliner blew out in January 2024 (AP)
By Eamon Quinn

Within hours of the January blow-out on a Boeing Max 9 plane, the US plane maker was staring at another crisis of its own making.

Almost a year later, the fallout is still being felt in Dublin by Ryanair, whose fleet of more than 600 planes is one of Boeing’s largest, and in Belfast, where 3,700 workers at supplier Spirit AeroSystems await the completion of an acquisition accelerated by the disaster.

On that Friday evening flight, a panel plug weakly secured by four bolts had been ripped from the Max 9 flying at 16,000ft, a short time after take-off from Portland, Oregon.

The spotlight was back on the safety oversight at the Boeing plants and on its major US suppliers, including at Spirit AeroSystems headquartered in Wichita, Kansas. The crisis didn’t stop there.

Boeing had struggled to recover when a Max plane crashed in Indonesia in 2018, killing all 189 people on board. The following year, the crash of an Ethiopian Airlines Max killed all 157 people. As the scale of cover-up over the faulty flight control software became clear, many criticised US regulators for their too-cosy relationship with the American plane maker. A $2.5 billion settlement by Boeing over the two fatal crashes had appeared to draw some sort of line, but the January blow-out put paid to such notions.

Boeing has since faced regulatory restrictions over the number of jets it could roll off its lines. Material shortages and global inflation made matters worse. Lengthy strikes across its plants in the Seattle region only settled in recent days had further curtailed production. Backlogs in deliveries to airlines like Ryanair whose fleets are based on Boeing lengthened further.

From the early days of rapid growth, the Michael O’Leary-run airline has stuck with its bet on Boeing. As the crisis engulfed all Boeing lines, it mattered little that Ryanair had had none of the grounded Max 9s in its fleet.

Delivery delays for Boeing 737 8200s forced Europe’s largest airline to pull back on its growth plans. And speaking last month, O’Leary said it was unlikely to take delivery of all of the 29 new planes it had once counted on before the 2025 summer peak. The Boeing delays “continue, frankly, to be a pain in the backside” for the airline, he said.

However, stock market investors appear to believe that Ryanair won’t be blown too much off course. Trading at €19.80 in Dublin on Friday, the shares have recovered significantly in recent months and value the airline at over €21.4 billion. (By way of comparison, easyJet is valued at less than €5.3 billion, while IAG – the owner of Aer Lingus, BA, Iberia and Vueling – is worth around €17.3 billion.)

So far so good. But there is still the question over the airline’s latest big bet on Boeing. Ryanair last year placed a huge order of €36.5 billion for 300 Max 10 planes, an aircraft that under-fire Boeing has yet to have certified by regulators.

Ryanair says it still expects to take delivery of the first of its Max 10s in 2027 to drive the next leap in its growth plans. However, for any major airline, 2027 is effectively just around the corner, and any new Boeing snarl-ups could cost Ryanair dearly.

In Belfast, the Boeing crisis is leading to an accelerated change of ownership for independent supplier Spirit AeroSystems. Before being spun out 20 years ago, the Wichita-based group was directly owned by Boeing.

Boeing now plans to buy back most of the operations at plants around the world related to its own contracts. But the operations at Belfast include contracts for Boeing as well as work building the mid-fuselage and wings for the Airbus A220. That provides a level of uncertainty and complexity for the Belfast workers in the planned carve up.

Spirit Aerosystems employ around 3,000 people across its Northern Ireland operation, which makes aircraft components including wings and fuselage.
Spirit Aerosystems' operations at Belfast include contracts for Boeing as well as work building the mid-fuselage and wings for the Airbus A220

In terms of the number of people employed by Spirit AeroSystems,the Belfast operations are by far the largest of its international operations. Meanwhile, both Airbus and Boeing have injected millions of dollars in loans into Spirit AeroSystems in recent weeks to ensure that work on their planes can continue at the Spirit plants around the world.

Stephen Furlong, senior analyst at Davy and one of Ireland’s leading aviation experts, says stock market investors believe the “traumatic issues” plaguing Boeing will nonetheless not be the existential axe for the American plane maker.

Many airlines have the limited choice between the Airbus and Boeing duopoly.

Moreover, the US manufacturer used to generate enormous levels of cash “and will do so again when it restarts making planes” in bulk, he says.

“People read about the demise of Boeing, but it really is not the case,” Furlong tells the Irish News.