Ryanair Chief Downplays Trump Tariff Threat, Cites Boeing’s Duty

Dublin, Ireland – Ryanair’s chief financial officer, Neil Sorahan, has expressed confidence that the airline will not bear the brunt of potential tariffs imposed by a future Donald Trump administration on European-made aircraft. Speaking amidst the airline’s strong financial performance, Sorahan indicated that the responsibility for absorbing such costs would primarily fall on the American manufacturer, Boeing.

EU warns of Trade Disruption

The prospect of meaningful tariffs on transatlantic trade has cast a shadow over international commerce. Maroš Šefčovič, the EU trade commissioner, recently warned that tariffs of 30% or more could make current transatlantic trade, valued at €4.4bn daily, “almost impossible to continue.” This sentiment highlights the potential for widespread economic disruption should such measures be implemented.

Airlines Face potential Cost Increases

The aviation sector is particularly vulnerable to trade disputes. Some airlines have voiced concerns about their ability to absorb the financial impact of tariffs. Delta Air Lines,a major US carrier,previously indicated that it might cease purchasing foreign-made aircraft if faced with increased costs. Last year, Delta took delivery of 47 Airbus aircraft manufactured in Canada, Germany, and France.

ryanair, a significant customer of Boeing in Europe, could also be exposed to levies on commercial aircraft. However, Sorahan clarified the airline’s position, stating, “It is a Boeing issue, not a ryanair issue.” He elaborated, “We have a fixed price with Boeing on the aircrafts… we’ll absolutely work with Boeing to try to mitigate the costs if it comes to pass. But I hope sense prevails.” This suggests a belief that Boeing, as the exporter, would be the primary entity responsible for managing any tariff-related expenses.

Ryanair Reports Strong Quarterly Profits

The comments from Sorahan come as Ryanair announced a significant boost in its financial results. The airline reported a post-tax profit of €820m (£710m) for the three months ending in June,more than doubling its earnings from the same period last year. This surge in profitability was partly attributed to a robust performance during the Easter holiday season.

The average fare paid by passengers increased by 21% year-on-year, reaching €51.This rise follows a 7% decrease in the previous year, which was attributed to cost-of-living pressures impacting consumer spending.

Aircraft delivery Delays Hamper Growth

Despite the positive financial outlook, Ryanair’s passenger growth is being constrained by delays in the delivery of new aircraft. Sorahan indicated that the company anticipates a modest increase of “just 3%” in passenger numbers for the full year, projecting a total of 206 million passengers. these delivery challenges,coupled with the looming threat of trade tariffs,present ongoing complexities for the airline’s expansion plans.