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United Airlines said Tuesday that it is ordering 200 Boeing Max jets and 70 Airbus planes so it can replace some of its aging planes and grow after the pandemic eases, a deal set to create tens of thousands of jobs.
The Boeing planes are 737 Max jets, which were grounded for almost two years following two fatal crashes that took the lives of 346 people, a big bet on the future safety of the craft.
Late last year, the Federal Aviation Administration approved changes that Boeing made to an automated flight-control system that was implicated in the disasters and the planes returned to service in December 2020.
It is one of the largest orders ever for commercial planes and underscores that airlines see a recovery underway and expect to return to the profitability they enjoyed before the pandemic crushed air travel more than a year ago.
At list prices, the deal would be worth more than $30 billion, although airlines routinely get deep discounts, sometimes more than half, according to analysts. United declined to disclose terms.
The largest combined order in United’s history, it’s also expected to increase available seats on domestic departures by nearly 30 percent.
United Airlines said Tuesday that it is ordering 200 Boeing Max jets and 70 Airbus planes so it can replace some of its aging planes and grow after the pandemic eases
The largest combined order in United’s history, it’s also expected to increase available seats on domestic departures by nearly 30 percent
It is also, of course, a major boost for the world’s two main aircraft makers, especially Boeing. The Chicago-based company saw orders plummet after Max jets were grounded following two deadly crashes. The pandemic has hurt sales too.
Boeing ‘needs to play a bit of catch-up,’ and so it likely gave United a steep discount, said George Dimitroff, analyst with Ascend by Cirium.
‘From here forward, pricing will get firmer,’ Dimitroff said. ‘I think that United is probably taking advantage of the last of the good pricing.’
United claims the orders will create 25,000 jobs over several years, although executives did not describe how they arrived at that figure. The airline has about 68,000 employees now.
United said it ordered 50 Max 8 jets, 150 slightly larger Max 10s, and 70 Airbus A321neos, which are larger still and usually seat 220 passengers in economy and premium.
The breakdown involves 40 new planes in 2022, 138 in 2023 and up to 350 more in 2024 and beyond.
The larger Airbus planes will be particularly valuable in San Francisco and Newark, New Jersey, where limited runways prevent United from adding many more flights, said Andrew Nocella, United’s chief commercial officer.
About 300 of the planes will replace jets that United plans to retire by 2026, including most of its Boeing 757s, while 200 will be used for growth, Nocella said.
The new aircrafts will have seat-back entertainment in every seat, larger overhead bins and ‘the industry’s fastest available in-flight WiFi.’
United claims the orders will create 25,000 jobs over several years, although executives did not describe how they arrived at that figure. The airline has about 68,000 employees now
United said it ordered 50 Max 8 jets, 150 slightly larger Max 10s, and 70 Airbus A321neos, which are larger still and usually seat 220 passengers in economy and premium
Although the planes in the new order are all narrow, single-aisle jets designed for domestic flying, United also has pending orders for so-called widebody planes used on international routes, and Nocella predicted that 2022 will be a record year for U.S.-Europe travel.
U.S. air travel has been slowly recovering since April 2020, when it dove below 100,000 people a day – a 1950s level of flying.
The Transportation Security Administration screened nearly 2.2 million people on Sunday, the highest number in 15 months but still 18 percent below the comparable Sunday in June 2019.
The breakdown involves 40 new planes in 2022, 138 in 2023 and up to 350 more in 2024 and beyond. A 737 MAX production line inside the Boeing factory is pictured
A Boeing 787 airplane for Turkish Airlines is seen on the production line at a Boeing factory. The purchase is a major boost for the world’s two main aircraft makers, especially Boeing
To that end, a near-record number of travelers could hit the skies for the Fourth of July holiday weekend, with 3.5 million passengers projected to fly – up nearly 164 percent from last year.
If the projections hold, the number of fliers this year could bump up against the all-time record of Independence Day air travelers.
In 2019, 3.9 million passengers took to the skies for the weekend of July 1 to 5, according to AAA.
The travel projections come as COVID-19 vaccination rates climb and people who have been stuck inside for nearly a year are eager to get out of the house and do something besides stare at the same four walls.
Still, with airlines having cut back their schedules and staffing dramatically in the wake of the virus shutdowns, many now are having trouble staffing back up and bulking their schedules to meet the sudden demand. Already, they’re potentially canceling thousands of flights.
The near-record travel predictions come on the heels of news that American Airlines, the country’s largest, canceled a total of 303 flights the weekend of June 19-20, amid warnings a surprise surge in demand for post-COVID travel could see 3,000 AA flights canceled by the end of July.
Travel is bouncing back fast in America after a year of unprecedented lows. Airlines who struggled during the pandemic are now scrambling to meet the sudden resurgence in demand
Bosses explained that the ongoing issues could force them to cancel 50 to 60 flights a day for the remainder of June – equivalent to 600 planes, and up to 80 flights a day in July – a further 2,480 jets.
Americans have returned to the skies far more quickly than large airlines were expecting as COVID-19 numbers drop and quarantine rules are lifted amid widespread access to vaccines. That sudden surge in demand has caught carriers by surprise, ABC News reported.
US airlines suffered their worst year in history in 2020 – losing a combined $35 billion. American, which is the world’s biggest airline by fleet size and passenger numbers, accounted for more than a quarter of that loss, falling $9.5 billion into the red.
Overall, American says it plans to cancel around 1 percent or 950 flights for the first half of July as it struggles to adjust to a new uptick in demand as the coronavirus pandemic recedes, according to the Wall Street Journal.
The majority of cancellations were for the A320 and 737 aircraft, and American said it anticipates cancelling 50 to 60 flights per day for the remainder of June and 50 to 80 flights per day in July, with total of up to 3,000 the airline told ABC.
Source: Daily Mail