CHICAGO — As part of its bid to emerge profitably from bankruptcy, United Airlines announced plans Wednesday to slash its domestic flight schedule, increase its more profitable international schedule and reduce the size of its fleet over the next six months.
United’s parent, UAL Corp., said that by March, it would increase the number of international flights by 14 percent and reduce domestic flights by 12 percent, shifting some to United Express.
The changes would result in a 3 percent overall decrease in available passenger seat miles.
“Fundamental changes in our industry, including ongoing high fuel costs, intense pricing pressure and continuing overcapacity, demand that we take aggressive steps now in implementing this plan to ensure that United remains competitive,” said Glenn Tilton, UAL’s chairman, president and chief executive officer.
With the changes, international operations would account for more than 40 percent of United’s capacity and 50 percent of its revenue, officials said. The airline has been expanding its international service, launching 30 new international routes since February 2002, including increased service to Asia.
Despite the reduction in domestic flights, Tilton said United would continue to operate its five U.S. hubs, in Chicago, Denver, Washington Dulles, San Francisco and Los Angeles. Delta Airlines, which recently warned it might have to file for bankruptcy, announced last month it would stop using Dallas-Fort Worth as a hub.
United also said it would reduce its fleet to 455 aircraft, 68 fewer than it flew in August. Officials said the airline had already reduced its fleet by 112 aircraft, or nearly 20 percent, since 2002.
The actions announced Wednesday are part of United’s efforts to reduce costs to competitive levels, Tilton said. He said the airline is on pace to achieve $5 billion in “annual costs improvements by 2005.”
United’s thinning of its fleet is exactly the kind of cut the airline needs to make if it is going to compete against point-to-point carriers, said George Novak, an airline industry analyst at George Washington University’s Aviation Institute. He said he wouldn’t be surprised to see more job cuts as a result.
“When you reduce your fleet, you have the need for fewer pilots, fewer flight attendants and fewer mechanics,” Novak said.
United said last month that job cuts would be part of a new plan to emerge from bankruptcy. The second largest airline has about 62,000 employees, down from more than 100,000 three years ago.
Like other major U.S. airlines, the Elk Grove Village, Ill.-based carrier is struggling amid an unprecedented slump that has worsened this year because of soaring jet-fuel prices and discount competition.
Despite slashing labor expenses last year by more than $2.5 billion annually, United seeks more than $1 billion in additional cutbacks and wants to dump its pension obligations in order to attract financing to get out of bankruptcy.
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