Ryanair cuts planned capacity and jobs, blames 737 MAX delays

By Conor Humphries

DUBLIN (Reuters) - Low-cost airline Ryanair trimmed its passenger traffic forecast on Wednesday, saying it would cut summer capacity and an unspecified number of jobs as a result of further delays in returning Boeing's (NYSE: BA) grounded 737 Max aircraft to service.

Ryanair has scrapped planned summer operations from bases in Nuremberg and Stockholm Skavsta, as well as some flights from other bases, "solely due to delivery delays" to MAX jets on order from Boeing, the company said in a statement.

"We are continuing to work with Boeing, our people, our unions and our affected airports to minimize these capacity cuts and job losses," Ryanair added.

A spokeswoman said the company had no further comment.

The 737 MAX, Boeing's fastest-selling aircraft, was grounded in March after two crashes attributed to anti-stall software in which a total of 346 people died. U.S. airlines have so far canceled planned MAX flights until March and a return to service is likely to take longer in Europe.

Ryanair, one of the biggest MAX customers with 210 planes on order, is working with "a steadily declining number" of deliveries expected by summer, group Chief Executive Michael O'Leary said during an unrelated court hearing in Dublin on Wednesday.

The group now anticipates it will receive 10 MAX aircraft in time for the summer season, having previously reduced its expectations to 20 from the 60 originally scheduled.

It also cut its traffic forecast to 156 million passengers for the year to March 31, 2021 from 157 million.

Shares in Sweden's SAS (OTC: SAS) were 2.6% higher in response to news of Ryanair's Stockholm base closure. Ryanair's shares were 0.3% higher.

Boeing took a $4.9 billion charge in the second quarter to cover anticipated compensation for its airline customers' lost business.

O'Leary, who was testifying in a court bid to prevent a former Ryanair executive joining rival easyJet before 2021, has previously said MAX compensation could be assessed only once final delivery dates were known.

Ryanair also said last month it expected further delays to its MAX jets and could still be without them altogether next summer.

(Reporting by Conor Humphries; Additional reporting by Yadarisa Shabong in Bengaluru; Writing by Laurence Frost; Editing by Kirsten Donovan)

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