CHICAGO, June 29, 2021 /PRNewswire/ -- United Airlines
today announced the purchase of 270 new Boeing and Airbus aircraft
- the largest combined order in the airline's history and the
biggest by an individual carrier in the last decade. The 'United
Next' plan will have a transformational effect on the customer
experience and is expected to increase the total number of
available seats per domestic departure by almost 30%, significantly
lower carbon emissions per seat and create tens of thousands of
quality, unionized jobs by 2026, all efforts that will have a
positive, ripple effect across the broader U.S. economy.
When combined with the current order book, United expects to
introduce more than 500 new, narrow-body aircraft: 40 in 2022, 138
in 2023 and as many as 350 in 2024 and beyond. That means in 2023
alone, United's fleet will, on average, add about one new
narrow-body aircraft every three days.
United's new aircraft order – 50 737 MAX 8s, 150 737 MAX 10s and
70 A321neos – will come with a new signature interior that includes
seat-back entertainment in every seat, larger overhead bins for
every passenger's carry-on bag and the industry's fastest available
in-flight WiFi, as well as a bright look-and-feel with LED
lighting. The airline expects to fly the first 737 MAX 8 with the
signature interior this summer and to begin flying the 737 MAX 10
and the Airbus A321neo in early 2023.
What's more, United intends to upgrade 100% of its mainline,
narrow-body fleet to these standards by 2025, an extraordinary
retrofit project that, when combined with the number of new
aircraft joining the fleet, means United will deliver its
state-of-the-art inflight experience to tens of millions of
customers at an unprecedented pace.
This order will also significantly boost United's total number
of mainline daily departures and available seats across the
airline's North American network, as well as the number of premium
seats, both United FirstSM and Economy Plus®.
Specifically, United expects it will have on average 53 premium
seats per North American departure by 2026, an increase of about
75% over 2019, and more than any competitor in North America.
"Our United Next vision will revolutionize the experience of
flying United as we accelerate our business to meet a resurgence in
air travel," said United CEO Scott
Kirby. "By adding and upgrading this many aircraft so
quickly with our new signature interiors, we'll combine friendly,
helpful service with the best experience in the sky, all across our
premier global network. At the same time, this move underscores the
critical role United plays in fueling the broader U.S. economy – we
expect the addition of these new aircraft will have a significant
economic impact on the communities we serve in terms of job
creation, traveler spending and commerce."
United expects to create approximately 25,000 well-paying,
unionized jobs at the airline as a result of adding these new
aircraft and, based on a study from the Federal Aviation
Administration, the airline expects to drive more than $30 billion in traveler spending when flying
United and contribute an estimated $50
billion annually towards the U.S. economy by 2026.
Plus, adding these new 737 MAX and Airbus A321neo aircraft means
United will replace older, smaller mainline jets and at least 200
single-class regional jets with larger aircraft, which the airline
expects will lead to significant sustainability benefits compared
to older planes: an expected 11% overall improvement in fuel
efficiency and an expected 17-20% lower carbon emission per seat
compared to older planes.
The best customer experience in the
industry
United's new aircraft reflect a vastly improved
customer experience standard – United's signature interior – that
places a premium on the overall comfort of flying – more overall
available seats in the market, more premium seats on each aircraft,
as well as better entertainment, overhead storage and technology
features. These standards will be applied to the airline's retrofit
plan - a nose-to-tail transformation of its mainline, narrow-body
fleet - that is expected to be 66% complete by 2023 and 99%
complete by the summer of 2025.
United's new narrow-body jets will help the airline increase its
total seats per departure for North American flights by 30 seats,
or almost 30%, by 2026. At the same time, the airline will quickly
grow the number of United FirstSM and Economy Plus®
seats for customers seeking an elevated experience.
United's 737 MAX 8 has 16 United FirstSM seats and 54
Economy Plus® seats – more than double the number of extra leg room
seats offered by competing airlines on similar-sized aircraft. The
737 MAX 10 - the largest member of the MAX family - makes up the
majority of United's new order and will include 20 United
FirstSM seats and 64 Economy Plus® seats and the new
A321neo aircraft are expected to have a United
FirstSM and Economy Plus® seat count similar to
that of the 737 MAX 10.
By flying bigger jets with a signature interior that includes
more premium seating, United will give customers more choice when
selecting their onboard experience, provide MileagePlus® members
more opportunity for upgrades, and position United to better meet
the demand among United's business customers while creating even
more connectivity to its global long-haul network, helping to fuel
growth to all corners of the world.
"We'll deliver a better, more consistent experience, with more
features for more customers, faster than ever. While some airlines
are reducing the number of economy seats with extra leg room,
United will offer the most premium seats in North America, taking a different, more
customer-friendly approach," said Andrew
Nocella, United's EVP and Chief Commercial Officer. "This is
United playing to our strengths - the location of our U.S. hubs
means we're uniquely positioned to focus on premium products,
business travel and global flying like no other U.S. airline. Our
new, signature interior creates a more consistent product across
our mainline fleet - with a focus on the amenities that customers
value most like seat back screens, fast WiFi and extra storage - to
further set ourselves apart."
United's inflight entertainment – 13-inch high-definition
screens in every first class seat and 10-inch HD screens in every
United Economy seat on the 737 MAX – includes free access to more
than 2,800 selections including movies, TV shows and international
selections, as well as audio playlists, podcasts, and games.
Customers also can watch documentaries and live concerts through
United's exclusive collaboration with the Coda Collection. Plus,
every seat on these aircraft has access to electrical power and USB
charge ports and provides a seatback experience with accessibility
features for people with hearing or visual disabilities.
Each new 737 MAX and A321neo will have the industry's fastest
available in-flight WiFi that lets customers stream video from
online services. The aircraft also will have Bluetooth technology
throughout for easy connections between wireless headphones and the
seatback entertainment screens.
United's new, significantly larger overhead bins will provide
space for one carry-on bag for every person onboard, addressing
several of the biggest pain points among customers and employees.
United expects that the availability of these larger bins will help
alleviate gate crowding and anxiety, reduce the number of
gate-checked bags and decrease the time it takes to board.
More Flights, New Destinations
United's plan to add hundreds of signature interior narrow-body
aircraft to its fleet will give customers access to more modern
seats and planes while reducing flights that use smaller,
single-class regional jets. These new aircraft also will give
customers even more options to fly between U.S. cities, including
some new destinations, when they travel through the airline's major
U.S. hubs. Finally, the larger mainline fleet will help accelerate
United's plans to expand service in partnership with local airport
authorities across the United
States.
Impact in Newark/NYC
United expects to resume its full schedule of flights out of
Newark by November 2021 when the FAA slot waiver period
ends. The airline is already the leading carrier from Newark - United's largest global gateway -
with 430 daily flights that include international destinations like
Johannesburg, Tel Aviv, Mumbai and Hong
Kong.
United expects the number of Newark departures on mainline aircraft to
increase from 55% in 2019 to 70% by 2026. And by late 2021, United
expects 100% of Newark departures
to be on dual-class aircraft, including the 737 MAX and the
airline's new, dual-class 50-seat CRJ-550 jet. Today's aircraft
order means the airline can create quality, union jobs, as well as
grow domestic and international capacity from Newark for years to come by replacing smaller
mainline jets with larger aircraft, while at the same time driving
international growth, by connecting more customers from U.S. cities
to Newark/NYC for their international flights.
United is in the midst of a significant facility expansion and
upgrade project at Newark. The
work includes renovating an existing United Club SM
location in Terminal C, building a completely new lounge in
Terminal C that is capable of accommodating 500 travelers and will
have panoramic views of Manhattan,
as well as building a brand new United Club in Terminal A where
United will operate from 12 new gates.
Jobs
Today, the airline supports about 68,000 union jobs - 89% of the
airline's total domestic workforce.
All United employees – even part-time workers – earn more than
the federal minimum wage, are eligible to receive
company-sponsored medical coverage, participate in company-funded
retirement programs like 401(k)s and receive paid sick leave, paid
vacation and flight privileges when space is available to
destinations around the world. Plus, these jobs offer opportunities
for career growth – about 69% of the airline's senior leaders were
internally promoted and more than 1,500 frontline employees have
been promoted into management roles in the past seven years.
"The addition of these 270 new aircraft and reduction of
single-class regional jets is not only good news for customers, it
is excellent news for the 12,000 current United pilots, and the
10,000 more we expect to hire before the decade is out," said
United ALPA Chair Capt. Todd Insler.
"This is exactly what we planned for when we reached our
industry-leading pandemic recovery agreement last year and kept
United pilots on the property, trained and ready to take advantage
of the rapid recovery in passenger demand. With the strength of our
network, fleet, and pilot compensation, we are sure United will
remain the destination of choice for the most highly qualified
airline pilots."
United's new aircraft order is expected to create about 25,000
well-paying, unionized jobs by 2026, including the following at
each of the airline's seven, major U.S. hubs:
- Newark /
EWR: up
to 5,000 jobs
- San Francisco /
SFO: up to 4,000
jobs
- Washington, D.C. /
IAD: up to 3,000 jobs
- Chicago /
ORD: up
to 3,000 jobs
- Houston /
IAH:
up to 3,000 jobs
- Denver /
DEN:
up to 3,000 jobs
- Los Angeles /
LAX:
up to 1,400 jobs
United has contracts in place with the following unions and
these descriptions provide an overview of each frontline group as
well as salary details for each position:
- Contact Center, Ramp and Customer Service Agents
(represented by IAM): United employed about 28,000 agents in
2019 - 14,000 who help load each aircraft, 12,000 customer service
representatives in airports and 3,000 contact center agents
(including about 900 based at the airline's Houston Reservation
Center and 700 at United's Chicago
facility) who help customers find the best option for their travel.
Most of these jobs include entry-level opportunities for people
directly out of high school and college, and their combined wages
and benefits in 2019 totaled more than $90,000 at the top of their pay scale. Several of
United's top leaders started out working on the ramp or in customer
service, including United's current Senior Vice President of
Airport Operations who started on the ramp, the airline's Vice
President of San Francisco, who
started as a customer service agent and United's current Managing
Director of Customer Care, who started as a lead travel
consultant.
- Dispatchers (represented by PAFCA): United has 400
dispatchers and in 2019 their combined wages and benefits totaled
more than $200,000 at the top of
their pay scale. These positions are certified by the FAA and share
joint responsibility with the captain for the safe operation of
every United flight. The airline has many dispatchers working in
United's Network Operations Center who came from positions across
the company including agents and management positions.
- Flight Attendants (represented by AFA): United had
about 24,000 active flight attendants in 2019 and their combined
wages and benefits totaled more than $90,000 at the top of their pay scale. With the
unique ability to see the world while working, it's no surprise
that flight attendant jobs are highly desired. In 2019, United had
over 65,000 applicants for fewer than 1,500 flight attendant
positions. New hires go through a six-week training course at
United's Houston Training Center and visit one of the airline's
seven training facilities every year to keep their skills fresh.
Additionally, those interested in becoming a flight attendant do
not require special schooling or a college degree and are fully
trained once hired. United's current Senior Vice President of
Inflight Services started as a flight attendant.
- Pilots (represented by ALPA): United has about
12,000 pilots - Captains of United's Boeing 787s and 777s can earn
more than $350,000. In addition,
United pilots receive one of the highest 401(k) matches in the
nation – 16% of base pay. United leads the industry as the only
major airline to own its own flight school – the United Aviate
Academy – and recently embarked on a plan to train 5,000 new pilots
by 2030 with the goal of at least half of them being women and
people of color. The company had previously announced that it
anticipates hiring more than 10,000 pilots by 2029. All United
pilots complete intensive simulator training with our pilot
instructors and evaluators every nine months at United's Flight
Training Center in Denver.
United's current Senior Vice President of Flight Operations started
as a First Officer, served as a U.S. Naval Aviator and retired as a
Navy Captain from the U.S. Navy Reserve.
- Technicians (represented by IBT): United had more
than 9,000 technicians in 2019 and their combined wages and
benefits totaled more than $140,000
at the top of their pay scale. This frontline team includes
aircraft mechanics, facilities technicians and ground equipment
technicians. These are highly skilled jobs – the airline actively
recruits from the military - and United provides an onramp to this
career through entry-level positions. Several United airlines
leaders started out as aircraft mechanics, including the airline's
current Vice President for Technical Operations.
Overall Economic Impact
In addition to creating jobs, the addition of these new aircraft
to United's fleet is expected to drive more than $30 billion in traveler spending when flying
United and contribute an estimated $50
billion annually towards the U.S. economy by 2026, based on
a study from the Federal Aviation Administration and United's
internal estimates:
- Jobs & Wages: In 2020, United paid more than
$10 billion in wages and this new
aircraft order has the potential to create an additional 25,000
United jobs by 2026, with billions of dollars more in potential
additional wages expected. United estimates that every new direct
airline job results in about two additional indirect jobs like
aircraft manufacturers, airport management and airport retail.
Furthermore, United's estimates indicate that each new direct and
indirect job induces an additional five jobs, potentially creating
a total wage impact of up to $12
billion annually.
- Visitor Spending: Based on the FAA study, United
estimates domestic air travelers spend about $500 per trip in addition to airfare (food,
lodging, recreation, gifts, entertainment, etc.). The addition of
270 new aircraft means the potential to carry tens of millions more
passengers per year through 2026, which, using this metric for
visitor spending, could contribute more than $30 billion in annual consumer spending when
traveling on United.
- Taxes & Fees: Each year, United generates about
$4 billion of direct (ticket excise,
fuel, and property) and payroll taxes. United's own internal
analysis estimates that these numbers will increase as a result of
purchasing these 270 new aircraft.
Sustainability
By 2026, United expects its use of aircraft in this new order
alone will lower the airline's total carbon emissions per seat up
to 15%. Specifically, the 737 MAX and A321neo aircraft offer
better overall range and environmental performance with their new,
more fuel-efficient engines and improved aerodynamics. Improvements
come from new engines, lighter-weight carbon composite airframes
and aerodynamic innovations like natural laminar flow that reduces
drag. United has set an ambitious goal to be 100% green by reducing
its greenhouse gas emissions 100% by 2050, without relying on
traditional carbon offsets.
About United
United's shared purpose is "Connecting People. Uniting the
World." For more information, visit united.com, follow @United on
Twitter and Instagram or connect on Facebook. The common stock of
UAL is traded on the Nasdaq under the symbol "UAL".
Cautionary Statement Regarding Forward-Looking
Statements1
Certain statements in this press release are forward-looking and
thus reflect United's current expectations and beliefs with respect
to certain current and future events and anticipated effects of the
new aircraft order and the broader United Next plan. Such
forward-looking statements are and will be subject to many risks
and uncertainties relating to United's operations and business
environment that may cause actual results to differ materially from
any future results expressed or implied in such forward-looking
statements. Words such as "expects," "will," "plans,"
"anticipates," "indicates," "remains," "believes," "estimates,"
"forecast," "guidance," "outlook," "goals," "targets" and similar
expressions are intended to identify forward-looking statements.
Additionally, forward-looking statements include statements that do
not relate solely to historical facts, such as conditional
statements, statements which identify uncertainties or trends,
discuss the possible future effects of current known trends or
uncertainties, or which indicate that the future effects of known
trends or uncertainties cannot be predicted, guaranteed or assured.
All forward-looking statements in this press release are based upon
information available to United on the date of this press release.
United undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events, changed circumstances or otherwise, except as
required by applicable law.
United's actual results could differ materially from these
forward-looking statements due to numerous factors including,
without limitation, the following: the adverse impacts of the
ongoing COVID-19 global pandemic, and possible outbreaks of another
disease or similar public health threat in the future, on the
business, operating results, financial condition, liquidity and
near-term and long-term strategic operating plan of United,
including possible additional adverse impacts resulting from the
duration and spread of the pandemic; unfavorable economic and
political conditions in the United
States and globally; the highly competitive nature of the
global airline industry and susceptibility of the industry to price
discounting and changes in capacity; high and/or volatile fuel
prices or significant disruptions in the supply of aircraft fuel;
United's reliance on technology and automated systems to operate
its business and the impact of any significant failure or
disruption of, or failure to effectively integrate and implement,
the technology or systems; United's reliance on third-party service
providers and the impact of any significant failure of these
parties to perform as expected, or interruptions in United's
relationships with these providers or their provision of services;
adverse publicity, harm to United's brand, reduced travel demand,
potential tort liability and voluntary or mandatory operational
restrictions as a result of an accident, catastrophe or incident
involving United, its regional carriers, its codeshare partners, or
another airline; terrorist attacks, international hostilities or
other security events, or the fear of terrorist attacks or
hostilities, even if not made directly on the airline industry;
increasing privacy and data security obligations or a significant
data breach; disruptions to United's regional network and United
Express flights provided by third-party regional carriers; the
failure of United's significant investments in other airlines,
equipment manufacturers and other aviation industry participants to
produce the returns or results United expects; further changes to
the airline industry with respect to alliances and joint business
arrangements or due to consolidations; changes in United's network
strategy or other factors outside United's control resulting in
less economic aircraft orders, costs related to modification or
termination of aircraft orders or entry into less favorable
aircraft orders, as well as any inability to accept or integrate
new aircraft into its fleet as planned; United's reliance on single
suppliers to source a majority of its aircraft and certain parts,
and the impact of any failure to obtain timely deliveries,
additional equipment or support from any of these suppliers; the
impacts of union disputes, employee strikes or slowdowns, and other
labor-related disruptions on United's operations; extended
interruptions or disruptions in service at major airports where
United operates; the impacts of seasonality and other factors
associated with the airline industry; United's failure to realize
the full value of its intangible assets or its long-lived assets,
causing United to record impairments; any damage to United's
reputation or brand image; the limitation of United's ability to
use its net operating loss carryforwards and certain other tax
attributes to offset future taxable income for U.S. federal income
tax purposes; the costs of compliance with extensive government
regulation of the airline industry; costs, liabilities and risks
associated with environmental regulation and climate change; the
impacts of United's significant amount of financial leverage from
fixed obligations, the possibility United may seek material amounts
of additional financial liquidity in the short-term and
insufficient liquidity on its financial condition and business;
failure to comply with the covenants in the MileagePlus financing
agreements, resulting in the possible acceleration of the
MileagePlus indebtedness, foreclosure upon the collateral securing
the MileagePlus indebtedness or the exercise of other remedies;
failure to comply with financial and other covenants governing
United's other debt; changes in, or failure to retain, United's
senior management team or other key employees; current or future
litigation and regulatory actions, or failure to comply with the
terms of any settlement, order or arrangement relating to these
actions; increases in insurance costs or inadequate insurance
coverage; and other risks and uncertainties set forth under Part I,
Item 1A., "Risk Factors," of United's Annual Report on Form 10-K
for the fiscal year ended December 31,
2020 as well as other risks and uncertainties set forth from
time to time in the reports United files with the U.S. Securities
and Exchange Commission.
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