* Ryanair deal with Boeing threatened by new delivery terms
* Dispute over pricing of 200 planes was almost resolved
* Ryanair says does not intend new bid for Aer Lingus
* O'Leary sees slow recovery in aviation business
(Adds detail, background)
By Pete Harrison
BRUSSELS, Dec 8 Ireland's Ryanair (RYA.I) is
likely to shelve plans to buy 200 Boeing (BA.N) aircraft because
the U.S. plane maker wants to change the delivery conditions,
Ryanair Chief Executive Michael O'Leary said on Tuesday.
"We have effectively almost reached agreement on price for a
200-aircraft order ... but the deal is unlikely to take place
because now they want to go back and change delivery
conditions," O'Leary told Reuters in an interview.
O'Leary, renowned in the industry for driving hard bargains,
had already warned last month that talks on ordering 200
aircraft for 2013-16 delivery had progressed little and that he
might slow down Ryanair's rapid growth from 2013.
"Last week we had pretty much reached agreement with them on
price, then over the weekend they wanted to change delivery
conditions," he said.
"We're going to make a final decision at the board meeting
next Thursday. Unless there's some change in their position over
the next week, it's off."
O'Leary said he had no alternative plan to buy aircraft from
Boeing's European rival, Airbus EAD.PA. But the European firm
said it was not interested in a bidding war over Ryanair.
"With what I know of the pricing levels they have in mind, I
think I can say this is one order that Boeing should win,"
Airbus sales chief John Leahy told Reuters in an interview.
The Boeing 737-800 aircraft used by Ryanair are worth $77
million at list prices, but planes are often sold at discounts.
Ryanair still has 102 planes due to arrive from a previous
order that have yet to be delivered, according to Boeing data.
Buying aircraft cheaply during industry downturns has
allowed Ryanair to pare costs to a minimum and take market share
from rivals unable to match its cut-price fares.
O'Leary famously placed an order for 100 new Boeing aircraft
and options on 50 more at rock-bottom prices in the wake of the
Sept. 11, 2001 attacks on the United States.
"I think you'll see a long, slow recovery here, not some
short, sharp rebound," he said of the economic crisis and its
effects on the airline industry.
"Clearly, I think, we've hit the bottom."
That industry slowdown has hit higher-cost airlines hard,
including Ireland's Aer Lingus AERL.I, which now plans to shed
almost a fifth of its staff as part of a plan to cut operating
costs by 97 million euros ($144 million).
But O'Leary, who has previously launched two unsuccessful
hostile bids for Aer Lingus, said he would probably not make
another offer for the carrier.
"I think we're highly unlikely to make a third bid for Aer
Lingus," he said.
(Additional reporting by Tim Hepher, Editing by Dale Hudson and