CHICAGO (Reuters) – United Airlines Holdings Inc <UAL> said on Tuesday it was suspending some flights between the United States and Beijing, Hong Kong and Shanghai between Feb. 1 and Feb. 8 due to a “significant decline in demand” as the new coronavirus spreads.
“We will continue to monitor the situation as it develops and will adjust our schedule as needed,” United said in a statement.
The coronavirus that originated in Wuhan, China has killed 106 people in the Asian country and spread across the world, rattling financial markets.
United’s suspension affects a total of 24 flights.
The other two U.S. airlines that fly to China, Delta Air Lines Inc <DAL> and American Airlines Group Inc <AAL>, said they had not reduced their flights at this time but were closely monitoring the situation.
(Reporting by Tracy Rucinski; Editing by Chris Reese and Bill Berkrot)
CHICAGO (Reuters) – United Airlines Holdings Inc <UAL> on Tuesday beat Wall Street estimates for quarterly profit and held to its 2020 profit target, with a turnaround strategy overseen by its outgoing CEO underpinning growth even as the Boeing 737 MAX remains grounded.
Chicago-based United is one of three U.S. airlines cancelling more than 1,000 monthly flights in a hit to profits as the 737 MAX remains grounded following two deadly crashes in Indonesia and Ethiopia. Boeing Co <BA> said on Tuesday it does not expect approval for the 737 MAX’s return to service until mid-year, later than previously forecast.
While United has warned of a hit from the MAX grounding, it did not disclose any estimated financial impact from the fallout and stood by its full-year adjusted EPS range of $11 to $13.
Total operating revenue rose 3.8% to $10.89 billion, boosted by strong travel demand and Chief Executive Oscar Munoz’s three-year strategy to build up the airline’s flight connections through its main U.S. hubs. United President Scott Kirby will succeed Munoz as CEO later this year.
Revenue per mile flown, a closely watched industry measurement, rose 0.8% in the fourth quarter and United forecast similar growth in the first quarter given solid bookings.
However, unit costs excluding fuel and profit-sharing expenses, a concern for investors in a year of contract negotiations with pilots, rose 2.7%.
United had already announced a non-cash impairment charge of $90 million in the fourth quarter related to its Hong Kong routes, following anti-government protests in the city.
Shares of United closed 4.4% lower at $85.79 before the earnings release, tracking sharp declines for U.S. airline and travel stocks on concerns over the Wuhan coronavirus in China, which J.P.Morgan analyst Jamie Baker said poses a near-term overhang for airlines.
United did not comment on the outbreak in its results but separately said there is no impact on its operations and it remains in close contact with U.S., Chinese and other Asian authorities on safety.
United management will host a conference call to discuss results on Wednesday at 10:30 a.m. EST (1630 GMT).
Adjusted net income rose to $676 million, or $2.67 per share, in the fourth quarter to Dec. 31, from $657 million a year earlier, topping a Wall Street consensus forecast for $2.65 per share.
Fellow U.S. MAX operators Southwest Airlines Co <LUV> and American Airlines Group Inc <AAL> are due to report quarterly results on Thursday.
The three airlines are scheduling without the MAX until early June though that timeline will likely need to be pushed back following Tuesday’s guidance from Boeing.
United, which had 14 737 MAX jets in its fleet at the time of the grounding, said it plans to take delivery of 28 MAX variants in 2020 depending on U.S. regulatory approval and Boeing’s subsequent pace of production and deliveries.
Among other aircraft orders, it expects to take delivery of two Boeing 777-300’s and 15 Boeing 787’s in 2020 but has decided to assign its purchase obligations for 20 Embraer 175’s to one of its regional partners once each jet is delivered.
(Reporting by Tracy Rucinski in Chicago; Additional reporting by Dominic Roshan K L in Bengaluru; Editing by Matthew Lewis)
An American Airlines Boeing 737 MAX 8 flight approaches to land at Reagan National Airport in Washington
A Boeing 737 Max aircraft taxis the runway at the Renton Municipal Airport in Renton
SYDNEY (Reuters) – Papua New Guinea carrier Air Niugini has updated its contract with Boeing Co <BA> to delay the delivery of its four 737 MAX jets on order until at least 2024, the airline’s chief executive said on Tuesday.
The carrier had been due to receive its first 737 MAX this year.
Air Niugini Chief Executive Alan Milne told Reuters the delay would give the airline more time to complete a broader review of its fleet plans, including a replacement for its smaller Fokker jets.
“This will then determine if the MAX is still appropriate for Air Niugini, or whether another Boeing product would better suit as a replacement for the 737/767,” he said, in reference to older models in the airline’s fleet.
Milne said it was possible the 737 MAX orders could be switched to the smaller Embraer SA <ERJ> E2 family if Boeing’s deal to buy the bulk of the Brazilian planemaker’s commercial division closes.
“Air Niugini is a valued Boeing customer and we are working closely with the airline to meet its evolving fleet requirements,” a Boeing spokesman said. “Unfortunately, we do not disclose ongoing customer discussions and have no further comment.”
Some other Boeing customers, including Malaysia Airlines, Virgin Australia Holdings Ltd <VBHLF> and Norwegian Air Shuttle ASA’s <NWARF> leasing arm have also postponed the delivery of 737 MAX jets since the model was grounded globally last March after two fatal crashes.
Boeing confirmed on Monday that it has temporarily halted production of the 737 MAX in Washington State in recent days. The company had said in December it would halt production at some point this month.
(Reporting by Jamie Freed; Editing by Paul Simao and Sam Holmes)
13 daily flights between Washington’s Reagan National and Newark Liberty mostly aboard the world’s only two-cabin 50-seat regional aircraft – the Bombardier CRJ-550 starting March 29
New jet offers first class seating, Wi-Fi, more leg room and enough space for every customer’s roller bag
WASHINGTON, Jan. 17, 2020 /PRNewswire/ — United Airlines today announced a new hourly shuttle service between Washington’s Reagan National Airport and New York/Newark Liberty International Airport. United will operate the world’s only two-cabin 50-seat regional aircraft – the Bombardier CRJ-550 on most flights. The CRJ-550 is designed for business and leisure travelers who want true-first-class seating, Wi-Fi, more leg room and enough space for every customer to bring a roller bag on board.
With this new shuttle service, United will now offer more travel opportunities between these two cities than any other airline in the world. Tickets for the 13 daily flights between New York/Newark and Washington, D.C. will be available for purchase beginning January 18 and service starts on March 29.
“Our customers who regularly travel between Washington, D.C. and New York – one of the busiest routes in the country – have told us they value convenient flights and a comfortable ride above all else,” said Sarah Murphy, United’s senior vice president of United Express. “With our new shuttle service aboard the one-of-a-kind CRJ-550, United Airlines is the only carrier to deliver both.”
The CRJ-550 is a first-of-its-kind jet boasting a wide variety of premium amenities, including:
10 seats in United First, 20 seats in Economy Plus, and 20 Economy seats
Space for every customer to bring a roller bag on board.
A self-serve refreshment center for United First customers featuring a wide assortment of snacks and beverages.
More overall legroom per seat than any other 50-seat aircraft flown by a U.S. airline.
The ability to stay connected while in flight with United Wi-Fi.
Every customer. Every flight. Every day.
United continues to strengthen its commitment to its customers, looking at every aspect of its business to ensure that the carrier keeps customers’ best interests at the heart of its service. In addition to today’s announcement, United recently:
Announced that MileagePlus award miles will never expire
Committed $40 million toward a new investment initiative focused on accelerating the development of sustainable aviation fuels and other decarbonization technologies
Established Miles on a Mission, a first-of-its-kind crowdsourcing platform which gives customers a simple way to donate miles to non-profit organizations and charities in need of air travel
Launched ConnectionSaver, a digital tool dedicated to improving the experience for customers with connecting flights
Instituted PlusPoints, new upgrade benefits for MileagePlus Premier members
Gave Economy customers a choice of complimentary snacks on domestic flights
Made DIRECTV free for every customer on more than 200 aircraft
United Airlines logo. (PRNewsFoto/United Airlines)
El Al Israel Airlines is outsourcing operation of its main freighter route between Tel Aviv and Liege, Belgium, to Atlas Air Inc. under an extended charter arrangement.
Atlas, an aviation services company headquartered in Purchase, N.Y., said Tuesday it is leasing El Al a Boeing 747-400 all-cargo aircraft, operating it with its own crew and providing maintenance and insurance (ACMI) beginning this month.
El Al, a new customer for Atlas, is experiencing strong growth in demand across its freight network, according to the announcement. The Israeli carrier sells the space on the plane and covers expenses such as ground handling, landing fees and fuel.
No terms of the commercial cooperation were disclosed, but ACMI deals typically run for one to three years.
(Reuters) – United Airlines Holdings Inc <UAL> said on Tuesday it expects a non-cash impairment charge of $90 million in the fourth quarter related to its Hong Kong routes, following anti-government protests in the city.
The Hong Kong protests escalated in June over a now-withdrawn extradition bill, but have since developed into a broader movement.
“Due to a decrease in demand for the Hong Kong market and the resulting decrease in unit revenue, the company determined that the value of its Hong Kong routes had been fully impaired,” the U.S. carrier said.
Several airlines including India’s SpiceJet Ltd <SPJT>, Malaysia’s AirAsia Group Bhd <AIABF>, South Korea’s JejuAir Co Ltd <089590> reduced the number of flights to the city in the fourth quarter as the protests grew increasingly violent, disrupting daily life.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Shounak Dasgupta)
Investment firm Bain Capital Credit will invest an initial $360 million in a joint venture with Atlas Air Worldwide Holdings (NASDAQ: AAWW), a major provider of outsourced all-cargo aircraft operations and other aviation services, to lease freighter aircraft, the companies said Wednesday.
Under the agreement, Atlas’ leasing subsidiary Titan Aviation Holdings Inc. will contribute $40 million of equity towards the portfolio, which ultimately could have a value of $1 billion with additional commitments to acquire aircraft over the next several years. The number and type of planes to be acquired are still to be determined. Titan will identify and source aircraft, as well as provide lease-management services to the venture.
The new company will be called Titan Aircraft Investment, Dan Loh, Atlas’ vice president of investor relations, told FreightWaves. “The parties are working expeditiously to complete and implement all elements of the joint venture,” he said.
Since its inception in 2009, Titan has grown to become the third-largest freighter lessor globally by fleet value with over 30 aircraft and a book value of over $1.5 billion.
Titan provides aircraft to airlines, which put them under their own operating certificate and then fly, maintain and insure them. Contracts are usually long term.
CHICAGO, Dec. 5, 2019 /PRNewswire/ — United Airlines (NASDAQ: UAL) today announced that Oscar Munoz, Chief Executive Officer, will transition to the role of Executive Chairman of the Board of Directors of United Airlines Holdings, Inc. in May 2020. As CEO, Munoz has transformed United’s culture and set new standards of operational and financial performance. J. Scott Kirby, President, will succeed Munoz as Chief Executive Officer.
“With United in a stronger position than ever, now is the right time to begin the process of passing the baton to a new leader,” Munoz said. “One of my goals as CEO was to put in place a successful leadership transition for United Airlines. I brought Scott to United three years ago, and I am confident that there is no one in the world better equipped to lead United to even greater heights. It has been the honor of my career to lead the 95,000 dedicated professionals who serve United’s customers every day. I look forward to continuing to work closely with Scott in the months ahead and supporting the company’s ongoing success in my new role.”
Kirby was recruited to United Airlines by Munoz in August 2016, after a three-decade career in the commercial airline business. His appointment reflects a commitment from Munoz and the Board to preserve leadership continuity and demonstrates confidence in the airline’s strategy and current trajectory.
“When I joined United as CEO, I laid out ambitious goals to build a new spirit of United by regaining the trust of our employees and customers – and I’m proud of how far we’ve come,” Munoz said. “Along with the successful implementation of the plan our team laid out in January 2018, United’s operational and financial performance isn’t just better – it’s better than ever. By instilling a culture of ‘proof not promise,’ we have transformed United even faster than we expected and there’s an incredible sense of excitement about the future.”
Kirby, a highly-regarded industry leader, has played a pivotal role in enabling United’s cultural transformation and successfully executing the company’s strategic growth plan.
“I am honored to be named the next CEO of United and to succeed Oscar, whose leadership has been truly transformational for United Airlines,” Kirby said. “I look forward to working with Oscar, the Board, our established leadership team and every United employee as we drive forward our proven strategy and focus on being the airline customers choose to fly and return to time and again.”
Munoz will serve as Executive Chairman for a one-year term and will continue to work closely with Kirby, the Board and the United team in shaping United’s employee and customer-centric culture. He will also lead the company’s Board and continue to engage on behalf of United with a range of external stakeholders.
As part of this transition, United’s current Chairman, Jane Garvey, will retire from the Board in May 2020 after more than a decade of exceptional service, including serving as Chairman since May 2018. At the request of the Board, Garvey agreed to remain in her role for a year beyond the Board’s mandatory retirement age.
“On behalf of the Board of Directors, I cannot thank Oscar enough for his outstanding leadership and commitment to United, and we are pleased that we will continue to benefit from his expertise and experience in his role as Executive Chairman,” Garvey said. “Oscar became CEO at one of the most challenging points in United’s history, and his focus on putting customers and employees first has transformed United’s culture today and successfully positioned the company for tomorrow. One of Oscar’s greatest legacies is the best-in-class leadership team he has built, and we have full confidence that Scott is the ideal candidate to lead United into the bright future that lies ahead.”
The company also announced that Ted Philip will become Lead Independent Director following the 2020 Annual Meeting of Shareholders. Philip joined the Board in July 2016 and chairs the Nominating/Governance Committee. He also currently serves on the Board of Directors of Hasbro, Inc. and BRP Inc.
“I could not be more excited about the opportunity that we have at United over the next several years to fulfill this airline’s incredible potential,” Philip said. “I am proud to work alongside Oscar in guiding United’s Board and leadership team, and I am eager to get to work on delivering for all of our stakeholders. The entire Board and I want to thank Jane for her many contributions to United over the last decade, including her highly successful tenure as Chairman.”
All of the changes announced today will take effect following the company’s Annual Meeting of Shareholders, scheduled for May 20, 2020.
Every customer. Every flight. Every day.
In 2019, United is focusing more than ever on its commitment to its customers, looking at every aspect of its business to ensure that the carrier keeps customers’ best interests at the heart of its service. In addition to today’s news, United recently announced that MileagePlus miles will now never expire, giving members a lifetime to use miles on flights and experiences. Customers now have more free on board snack options as well, with a choice of Lotus Biscoff cookies, pretzels and the Stroopwafel. The airline also recently released a re-imagined version of the most downloaded app in the airline industry, introduced ConnectionSaver – a tool dedicated to improving the experience for customers connecting from one United flight to the next – and launched PlusPoints, a new upgrade benefit for MileagePlus premier members.
CHICAGO, Dec 3 (Reuters) – United Airlines Holdings Inc announced on Tuesday an order for 50 Airbus SE A321XLR jets to fly between the U.S East Coast and Europe, becoming the latest U.S. airline to ink a deal for the European planemaker’s new passenger jet.
The long-range A321XLR jets will replace United’s 53 Boeing 757-200 planes beginning in 2024, the Chicago-based planemaker said, flying to cities like Porto, Portugal and other potential new destinations.
United’s 757 planes will reach the end of their lifespan in about a decade and Boeing Co is not building any more of the large single-aisle model.
Instead, the U.S. planemaker has been considering a new twin-aisle plane, provisionally known as the NMA, but has delayed a launch decision until 2020 while it manages the ongoing global grounding of its 737 MAX jets following two fatal crashes.
United’s chief operating officer Andrew Nocella told reporters the airline has worked closely with Boeing on the potential new aircraft and is still open to orders if the planemaker decides to move forward with developing the NMA.
Meanwhile, U.S carriers including American Airlines Group Inc, JetBlue Airways Corp and Spirit Airlines Inc have agreed orders for Airbus A320neo-family jets.
Among the benefits of the A321XLR is a 30% lower fuel burn per seat compared to previous generation aircraft, United said.
United has also ordered the larger A350 widebody jets but said it is deferring delivery of those jets until they are needed in 2027.
Its A321XLR order is the second for a U.S. carrier following tariffs that the United States is imposing on European-made aircraft.
(Reporting by Tracy Rucinski Editing by Chris Reese and Michael Perry)
PURCHASE, N.Y., Nov. 21, 2019 (GLOBE NEWSWIRE) — Atlas Air Worldwide Holdings, Inc. (AAWW) today confirmed that its subsidiaries Atlas Air, Inc. and Southern Air, Inc. have prevailed in another legal dispute with the union that represents its pilots in ongoing negotiations, the International Brotherhood of Teamsters.
The decision by the U.S. Court of Appeals for the Second Circuit affirms a March 13, 2018, decision by the Southern District Court of New York compelling the Teamsters to arbitrate whether the merger provisions in Atlas Air and Southern Air’s collective bargaining agreements apply to the bargaining process. Today’s decision, as well as two binding decisions by arbitrators rendered in favor of both Atlas Air and Southern Air this summer, have made clear that IBT must engage in the current Atlas Air and Southern Air collective bargaining agreements’ expedited and defined process for achieving a joint collective bargaining agreement.
In a separate labor-related decision rendered in July 2019, the U.S. Court of Appeals for the District of Columbia unanimously affirmed a federal district court ruling in November 2017 that ordered the union to stop an intentional and illegal work slowdown by Atlas Air pilots in violation of the Railway Labor Act. The unanimous ruling from a three-judge panel upheld the lower-court order that blocked the union from continuing to engage in improper activities such as excessive sick calls on short notice or refusing to volunteer for open time.
“With these decisions behind us, it’s time for the union to honor its obligations under the collective bargaining agreements and these binding decisions. Specifically, the union has an obligation to produce an integrated seniority list and engage in direct bargaining for a defined and limited period of time. In ongoing negotiations, the union has yet to provide us with a comprehensive economic proposal covering pay and benefits for evaluation. We remain committed to working collaboratively with union leaders to efficiently negotiate and complete the contract,” said William J. Flynn, Chairman and Chief Executive Officer, Atlas Air Worldwide.
For more information about the contract negotiations process and updates, please visit AtlasAir5YPilots.com and follow @AtlasAir5Y on Twitter.
