A Ryanair order for additional Boeing 737s is “highly unlikely to happen,” according to the airline’s CEO Michael O’Leary.

The carrier and the manufacturer have been negotiating the order for up to 200 aircraft for months without reaching an agreement. O’Leary said Boeing still has until Dec. 17 to come up with a proposal acceptable to the airline. Ryanair’s next board meeting is scheduled on that day.

O’Leary said the two sides have agreed as far as prices are concerned, but he claimed the manufacturer is offering terms and delivery conditions that are inferior to what Boeing was prepared to accept in previous orders. Boeing declined to comment on the Ryanair campaign.

Ryanair has a fleet of 202 Boeing 737s, although a significant number of aircraft is parked in the winter low season. It has firm orders outstanding for a total of 102 aircraft that are to be delivered by the end of 2012. Traditionally, Ryanair is an active and early seller of existing aircraft. The airline placed big orders with Boeing at huge discounts, with industry sources saying it has bought Boeing 737-800s at less than $30 million a piece when the official list price was more than $60 million.

The airline has warned that if it does not reach an agreement with Boeing it could curtail its growth in the next few years and focus on maximizing profits and dividends. However, the airline is facing tougher market conditions for its business model, too. It is continuing its growth pattern, but can only do so at double-digit drops in average yields putting pressure on profit margins. Rival Easyjet has reduced its annual growth rate from 15% to 7%.

Airbus Chief Operating Officer, Customers, John Leahy, said in an interview yesterday that he “would not have a problem selling aircraft to O’Leary at reasonable prices, but I have not seen anything reasonable from him.” Industry sources said there are no current negotiations between Ryanair and Airbus.

Photo: Boeing