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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: How Sweat Shares, if Rana Rebounding and Irish Training. The

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Speaker 2: company Canton gets passenger growth target for next year because

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Speaker 2: of delivery delays from aircraft supplier Bow Inc. MICHAELA. Larry,

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Speaker 2: the CEO, John Sarana Taible, Michael Komonic.

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Speaker 3: John, good morning, Great to be back in New York.

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Speaker 2: Good to see you, sir. Have you spoukls Kelly out back.

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Speaker 4: I've poked to Stephanie Pope on Friday afternoon, so she's

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Speaker 4: reasonably hopeful that the vote on the new pay deal

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Speaker 4: will be approved tonight. It doesn't make a lot of

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Speaker 4: difference to us one way or another because we're gone

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Speaker 4: into the winter now. Anyway, the big issue for me

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Speaker 4: was how's the certification of the Max seven and Max

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Speaker 4: ten going. I think the good news the strike hasn't

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Speaker 4: delayed that certification. Work Manager's still working certification. She still

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Speaker 4: expects the Max seven to get certified first half of

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Speaker 4: twenty five, Max ten second half of twenty five. So

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Speaker 4: I think we're still good to go on the first

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Speaker 4: of our Max ten deliveries in spring of twenty twenty seven.

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Speaker 4: And that's what really takes us from our two hundred

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Speaker 4: million now to three hundred million pastures by the mid

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Speaker 4: twenty thirties.

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Speaker 2: How are they stelific? Delight setting your company? Just give

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Speaker 2: us an idea.

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Speaker 3: I mean, they're they've been very frustrating.

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Speaker 4: All we were supposed to get grow to two hundred

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Speaker 4: and five million pastures this year, we'll do about one

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Speaker 4: nine to nine and change next year was two hundred

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Speaker 4: and fifteen million pastures. We now cut it back to

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Speaker 4: about two hundred and ten, might get two eight two

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Speaker 4: oh seven. So it's frustrating, but in a bizarre way,

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Speaker 4: it might actually help our earnings next year, because you

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Speaker 4: know we'll be heavily constrained in terms of our capacity growth.

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Speaker 4: We had a bit of a disappointment on pricing this summer.

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Speaker 4: After two years of twenty percent fair increases, this year

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Speaker 4: we're down ten.

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Speaker 3: Percent in the first half of the year.

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Speaker 4: But with real capacity constraints next summer, with interest rates easing,

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Speaker 4: inflation no.

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Speaker 3: Longer a worry.

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Speaker 4: I think there's a reasonable rebound in consumer spending next year,

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Speaker 4: and we hope to see that reflected in modestly upward fares,

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Speaker 4: which with Ryanair's very stable cost space will flow largely

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Speaker 4: through to the bottom line, so you could.

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Speaker 1: See another ten percent maybe a fair increase next year.

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Speaker 4: I wouldn't want to put a number and put I mean,

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Speaker 4: I think off a ten percent decline this year, I

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Speaker 4: think it's reasonable to expect next year that you know,

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Speaker 4: affairs will be up. I would hope we'd recover most,

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Speaker 4: if not all, of this year's ten percent fair decline.

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Speaker 1: So why were fares down earlier if there still is

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Speaker 1: all this pent up demand for people to travel, why

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Speaker 1: has that been such a soft patch for airlines across

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Speaker 1: the world.

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Speaker 3: Well, I think this year, I mean, certainly the first

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Speaker 3: half of this year. This consumers under real pressure. In Europe.

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Speaker 4: You had high interest rates at the central banks really

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Speaker 4: squeezing down on inflation.

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Speaker 3: First half of the year.

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Speaker 4: We had an unusual event ourselves, so we had this

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Speaker 4: dispute with the online travel agent started last November. They

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Speaker 4: boycotted us from November December. I think that hit us

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Speaker 4: this year on pricing. We lost a lot of the

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Speaker 4: kind of the advanced bookings of summer holidays, people who

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Speaker 4: book well in advance using those OTAs.

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Speaker 3: They moved towards the tour operators.

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Speaker 4: We've now signed up approved OTA deals with about ninety

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Speaker 4: percent of the OTA customers, and we're seeing very strong

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Speaker 4: forward books into summer twenty twenty five.

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Speaker 1: Hours result, there's a larger question here. If you're depending

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Speaker 1: on going to come up with some planes, you're reading

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Speaker 1: the news about the strike, You're talking to executives finding

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Speaker 1: out the blow by blow about when they can actually

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Speaker 1: get back to the floor and produce again, do you

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Speaker 1: have an alternative?

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Speaker 3: Orre you looking at alternatives?

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Speaker 1: So you're thinking to yourself, really, am I really doing

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Speaker 1: this again?

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Speaker 4: I mean, the honest answer is no airline has an alternative.

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Speaker 4: There's two manufacturers in the world. You've got Airbus and

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Speaker 4: you got Boeing. Boeing gets all the negative pr they have,

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Speaker 4: the strike, they've had the max grounding.

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Speaker 3: Airbus are and as much of a mess as Boeing r.

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Speaker 3: I mean, Airbus are way.

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Speaker 4: Behind them their monthly production, the engines, the protect with

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Speaker 4: the engines on the Airbos aircraft are dud, so they're

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Speaker 4: taking them off the wing. They're going through twelve month

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Speaker 4: repair processes. And you know Europe is an airbus marketplace,

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Speaker 4: so Airbos are just as bad as Boeing are. I'm

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Speaker 4: very happy to be a Boeing customer. I think the

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Speaker 4: Boeing aircraft is a better aircraft. The newer aircraft we're

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Speaker 4: taking now the game changes. We're carrying four percent more pastors,

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Speaker 4: we're burning sixteen percent less fuel.

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Speaker 3: That's transformation into our numbers.

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Speaker 4: You look at our numbers this morning, and in a

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Speaker 4: year a summer where we carry nine percent more pastures

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Speaker 4: uster flat.

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Speaker 3: We're the only year that.

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Speaker 4: I would flat unit costs in North America or in

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Speaker 4: European this year.

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Speaker 3: Yes, we've taken a bump on fares.

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Speaker 4: I think that's good if your passes are getting lower prices. Yes,

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Speaker 4: we'll take a hit in the short term on profitability,

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Speaker 4: but we're taking huge amounts of market share of everybody else.

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Speaker 4: And next year, if I think we see a bit

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Speaker 4: of a bump upwards in airfares, I think it'll come

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Speaker 4: straight through to our bottom line.

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Speaker 5: Michael, do you think there are times of charm? Well,

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Speaker 5: this deal that's on the table right now get through.

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Speaker 4: I mean again, I think bows call on might call

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Speaker 4: on Friday they think it's fifty to fifty. I mean,

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Speaker 4: very hard to see how any labor group turns down

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Speaker 4: a thirty eight percent pay increase with the ridiculous sign

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Speaker 4: on bonuses. I think on bands, I think they probably

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Speaker 4: will turn it down. I think they'll hold out for forty,

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Speaker 4: but it's a short term.

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Speaker 3: This is a frustration Boeing go to forty. If they

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Speaker 3: turn down thirty eight, I don't know where else do

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Speaker 3: you go.

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Speaker 4: They're not going to go backwards towards thirty, I think,

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Speaker 4: I mean, I hope it's resolved to seeing whether it's

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Speaker 4: thirty eight or forty. I think we're at where at

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Speaker 4: the endgame. It doesn't make much difference to us. I

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Speaker 4: had nine deliveries in November and deceventh. They're going to

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Speaker 4: get pushed out into February and March. The big issue

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Speaker 4: for me, Boy is supposed to deliver me twenty nine

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Speaker 4: aircraft before June next year. I think now we're looking

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Speaker 4: only getting half of those, so about fourteen of the

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Speaker 4: twenty nine aircraft. So I've had to walk back my

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Speaker 4: growth next year. Instead of two hundred and fifteen million pastors,

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Speaker 4: it'll be two hundred and ten million, and that number

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Speaker 4: might creep slightly downwards. So it's frustrating, but really over

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Speaker 4: the medium turn, the big issue for me is bowing

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Speaker 4: when you can get the Max seven certified, when are

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Speaker 4: you going to get the Max ten certified? If they

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Speaker 4: get those certified in twenty five, we're looking taking delivery

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Speaker 4: of an aircraft in twenty twenty seven that carries twenty

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Speaker 4: percent more pastors with birds twenty percent as fuel. I

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Speaker 4: just blew up the entire competition in Europe. No airbus

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Speaker 4: aircraft will be able to compete with me.

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Speaker 5: I want to ask you about the competition in the UK.

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Speaker 5: I used to live in the UK, used to fly

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Speaker 5: on Ryanair. Now you're reviewing your schedule out of the

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Speaker 5: UK because the government is charging two pounds more person.

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Speaker 4: I mean you with this Bonker's labor government. You know

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Speaker 4: they got elected on this kind of pro We're.

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Speaker 3: Going to be pro growth. We're going to grow whatever

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Speaker 3: is we're going to grow. And the first they do

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Speaker 3: on an island of the Europe, we're going to put

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Speaker 3: up travel taxes. You can't grow, So will you've cut capacity?

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Speaker 4: We're going to switch along. I mean, we do about

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Speaker 4: fifty five million pastores a year to the UK. We're

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Speaker 4: going to switch about five million of that capacity, which

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Speaker 4: maybe takes place on aircraft that are based in Europe

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Speaker 4: to fly into the UK. We're going to move that

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Speaker 4: now next year to Italy, Sweden, Hungary where they're abolishing

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Speaker 4: travel taxes, so we have the flexibility to move that

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Speaker 4: capacity around. And again I think it'll be good for

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Speaker 4: my pricing in the UK next year. Bad for growth.

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Speaker 4: I mean, the UK has no chance of growing if

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Speaker 4: this idiot Chancellor thinks that the way forward is going

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Speaker 4: to be increasing.

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Speaker 3: Tax on air travel. You want to grow, scrap air

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Speaker 3: travel taxes.

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Speaker 4: The Italians get it, the Swedes get it, The Irish

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Speaker 4: God of the bridge will eventually work it out. But

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Speaker 4: you know, these guys haven't been in powerful about fifteen years,

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Speaker 4: and I think they're going to learn some very harsh

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Speaker 4: lessons in the next year or two.

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Speaker 2: I asked you if you Spikin's calliop, but have you

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Speaker 2: spouken to Chancellor Race now?

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Speaker 4: And I suspect the chances of me having a conversation

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Speaker 4: with her in the next couple of weeks will be

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Speaker 4: are diminishing rapidly, you know, Like I mean, this is

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Speaker 4: a girl who you know, her background was in the Treasury.

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Speaker 4: She should understand that the way to you know, you

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Speaker 4: really want to deliver growth in the UK, particularly in

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Speaker 4: the regions, tourism is the one industry you can turn

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Speaker 4: on turn off at the drop of a hat. And

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Speaker 4: her first measure is to increase travel taxes.

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Speaker 3: You've got to be insane to do that.

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Speaker 2: When you do that, Micaelde, two pounds on showhold travel

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Speaker 2: per passenger, grand scheme of things. You step back your site.

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Speaker 2: Two pounds might not sound back a lot from your perspective,

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Speaker 2: you're fantastic with the numbers. Walk us through how two

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Speaker 2: pounds changes the game for you? How does that ripple

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Speaker 2: through the system.

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Speaker 4: See the point is it's two pounds up in the UK.

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Speaker 4: But in Italy at the moment they're reducing the municipal tax.

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Speaker 4: There's scrappy municipal tax which is a reduction of six

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Speaker 4: fifty so.

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Speaker 3: On all of it. The move now is ten euros.

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Speaker 4: So do I put another flight into Italy next year

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Speaker 4: or do I put another flight into the UK? I

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Speaker 4: move capacity out of the UK into Italy. Sweden, they've

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Speaker 4: bought Sweden, the home of travel, the home of flight shaming.

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Speaker 4: Greta Tonberg where she got her limited education up there

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Speaker 4: have now scrapped aviation taxes. There's a new right Wing

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Speaker 4: Transport minister se who gets it. Greta was wrong. She

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Speaker 4: should go back to bloody school and stop boycotting school.

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Speaker 3: They're scrapping the traffic. So if I move an aircraft

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Speaker 3: from the UK next year, it's.

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Speaker 4: Not a too quid differential, But if I move that

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Speaker 4: up to Sweden, it's a ten euro differential and that's transformative.

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Speaker 4: If I can lower my fares to Sweden next year

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Speaker 4: by ten euros, I will carry many more passages to Sweden.

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Speaker 3: I'll carry fewer in the UK.

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Speaker 4: Airfares in the UK will rise, Regional traffic and tourism

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Speaker 4: in the UK will fall, Sweden will boom, Italy will boom.

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Speaker 4: Until Ratio re works it out that this is not

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Speaker 4: the way forward.

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Speaker 2: Michael A. Larry continue the conversation if you like, if

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Speaker 2: you want to stick around it because.

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Speaker 3: Nay love you see you all come back to Europe.

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Speaker 2: We need you the Ryan Essa Michael Alarry