Regarding United Airlines. I doubt that they will go bankrupt. When Jim Goodwin announced that UA would go bankrupt, people forgot that he said "if we keep loosing money at this rate." Right now, United is loosing close to 1 million a day...not 13 million a day when Goodwin made that statement. It has been going down since Novemeber.
Currently, there are four 747s in storage. The other 40 747s are flying the line. Most of them are sent to Asia, or the south pacific once a day. Most of the flights to Asia are going out full/oversold in all cabins.
I saw the pictures of the 777s at PAE, and the deal with those are that there are not enough 777 engines for 777s. They are being put on an "out of service" status, not "stored" status. United has not yet stored a single 777, like it has with the 747. Just to set the record straight.
United's average load factor is around 77% compared to 68% at most other carriers. They also cut more flights post september 11th, but kept the ones at the peak periods. They have cut east-west redeyes as they get in after midnight/1am. They kept west-east red-eyes as they arrive early in the morning.
United is also taking delivery of new Airbusses. Sadly, these planes are going to Ansett for two years. On the plus side, United is making a lot of money by doing this. At the moment, they do not need the extra busses, so leasing them out is a good move for UA.
So, whats wrong with United? Well, United is loosing around 1 million a day. Our average load factor is not high enough, and the premium cabin yeilds are not as high as they once were. United also has to pay its labor force more than any other carrier. Expect pay cuts to come before summer from all employee groups, especially ALPA.
As a cost saving measure, United is starting to contract out many more flights to its Express carriers. SkyWest is opening up a RJ hubs in SFO, LAX and DEN. AirWisconsin RJs are being spotted several times aday in LAX to assist SkyWest. New routes are going to Express that were once shuttle. Where 737s would go out empty to places like SBA and BOI, RJs are now/soon going to these markets. Many of the ex Shuttle routes are going to Express. While the thoughts of an hour in an RJ is not the most pleasent, it saves the company tons of money.
To fix the problems, United fired Jim Goodwin as its CEO and hired Jack Creighton who is accepting no pay for his job, just stock options.
To reduce costs, routes are going to RJs, service items are being cut/reduced, and non-ecential flights are being cut.
A positive effort is being made so that United will fly you where you need to go when you need to go. West to east transcons depart around 11am, for an evening arrival. East coast to west coast transcons leave in the evening for nightime arrivals. Connecting flights to Latin America, Europe, Asia and the South Pacific meet these flights.
United still has one of the best route maps, and has some of the strongest alliance partners. They still offer a award winning product, even with the service cuts. As more and more people begin to fly, sources tell me that by April, United will have a positive cash flow.
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