United Airlines has reported a third-quarter profit of $473 million. Coming off of a strong summer, United is getting ready to move beyond the crisis and turn to 2022. Next year, United expects a record for international capacity buoyed by the return of the Pratt & Whitney Boeing 777s next year. These aircraft have been grounded since February.
United’s third quarter
United Airlines recorded a third-quarter profit of $473 million, including government support. Taking that out of the equation, United saw an adjusted net loss of $329 million. This was on operating revenue of $7.8 billion, which was down 31.9% from the third quarter of 2019.
Total capacity for the quarter was down 28% compared to the same quarter in 2019. Looking at this by geography, United’s domestic capacity was down 19.5% from the third quarter of 2019. Atlantic revenue was down 34.9% and Pacific revenue was down 75.2% from the same quarter. However, something that was quite interesting was to see United flying 9.9% more capacity in Latin America than it has previously. Altogether, international capacity was down 39.7% compared to the same quarter of 2019.
The consolidated passenger load factor for the quarter was 76.1%. Domestic performed well at 82.4% – down from the domestic load factor of 86.6% in 2019. International load factor stood at 65.2%, down from the 85.4% United recorded in the same quarter in 2019.
Boeing 777s coming back to power international growth
United’s 52 Boeing 777-200s powered by Pratt & Whitney engines remain grounded. However, the airline is keenly eyeing the return of these aircraft to active service and is expecting the jets to return to the skies in 2022, likely before the summer season.
If the 777s get back in the air, United will be increasing its international capacity by 10% in 2022 compared to 2019 levels while keeping domestic capacity flat. Together, this would get United to a 5% growth in capacity compared to 2019 levels.
As part of the record 2022 capacity, United will be flying at its highest levels to markets in Europe, Latin America, India, Africa, and the Middle East. United has grown its Latin America network to already above 2019 levels. Meanwhile, the carrier added flights to Accra and Johannesburg this year. Cape Town is coming back. Lagos will be joining from late November, bringing United to its largest-ever international network.
United is, for now, the only US airline that is flying nonstop between India and the US. The airline added a new route to Delhi from Chicago late last year. Still, next year, the carrier is planning to launch its highly-anticipated San Francisco – Bangalore connection targeting corporate tech-based travelers.
Europe and the Middle East will be buoyed by United’s transatlantic route expansion announced recently. This includes the addition of five new destinations: Amman (Jordan), Tenerife (Spain), Azores (Portugal), Palma de Mallorca (Spain), Bergen (Norway). With transpacific travel down, United is moving planes devoted to extensive schedules to this part of the world to service destinations across the Atlantic that are open for travel.
Moving forward with United Next
At the end of June, United Airlines – with plenty of pomp and circumstance – announced its strategy coming out of the crisis. The plan has both customer-centric and financial targets. United states it is on track to meet both sets of targets, with expectations that 2022 unit costs, excluding fuel, will be below 2019 levels.
In addition, United has achieved its highest ever Net Promoter Score (NPS) year-to-date. Fleet-wise, United’s new Boeing 737 MAX 8 aircraft with the carrier’s signature interior received the highest scores. United has announced that it will be retrofitting its entire mainline narrowbody fleet to include larger overhead bins, improved WiFi, and seatback entertainment for all customers.
United is on track to build itself as a premier international carrier. With the most extensive international network of major US airlines, United is now looking to bolster its route network by focusing heavily on a more premium experience that will bring more customers on its planes at a higher yield. The next few years will be vital to determining the success of the United Next strategy.
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