29th June, 2021
United Airlines on Tuesday unveiled its largest ever order for 270 Boeing and Airbus jets worth more than $30 billion at list prices as it seeks to grow domestically after the pandemic.
The order for 200 Boeing 737 MAX and 70 Airbus A321neo planes, will replace older, smaller mainline jets and at least 200 small regional jets between 2022 and 2026, the airline said.
That will allow America’s third largest airline by revenue to boost the number of seats it has across its domestic network, which lags major rivals, by almost 30% and get better use out of hubs.
Chicago-based United is the most exposed U.S. airline to international travel, which suffered heavily during the pandemic and is rebounding more slowly than domestic travel.
Chief Executive Scott Kirby said the fleet shake-up would “accelerate our business to meet a resurgence in air travel”.
The deal includes 50 Boeing 737 MAX 8 and 150 MAX 10, accelerating a recovery for the MAX in the wake of a two-year safety crisis overlapping with a COVID-19 travel slump.
However, it maintains European rival Airbus’s grip on a lucrative segment for the largest, long-range single-aisles, where Boeing has been losing sales to the A321neo.
The MAX 10, which made its first flight this month, is the largest member of the MAX family and holds up to 230 seats.
The Airbus A321neo is slightly larger and has more range, giving United extra capacity at constrained airports like Newark and San Francisco that play a key role in its growth plans.
“That’s one of the primary reasons that the order includes both jet types,” Chief Commercial Officer Andrew Nocella said.
A United spokesperson said it had the option to convert the MAX order to other variants before they were built.
The new Boeing and Airbus jets will include new interiors as part of a sweeping cabin overhaul.
United, which unlike major rivals did not retire aircraft during the pandemic despite having one of the oldest U.S. fleets, said it plans to fly the first MAX 8 with the new interior this summer and the MAX 10 and A321neo in early 2023.
The order includes 25 737 MAX “white tails”, or orders cancelled by other buyers during a lengthy safety grounding.
The airline, which received $10.5 billion in government aid during the pandemic, devoted a large part of its release to a pledge to create 25,000 unionized jobs as part of the purchase.
United’s use of 50-seat jets will fall to less than 10% of its domestic departures versus about one third currently, Nocella said.
The order also serves to replace United’s aging Boeing 757-200 fleet, though the airline has not yet decided on a replacement for its 757-300s, he told reporters.
*Reuters via NAN