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United Airlines to slash fleet, 1,100 jobs as fuel prices soar

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United Airlines, the second-largest U.S. carrier, said Wednesday it was cutting its fleet, operations and up to 1,100 additional jobs to compete amid soaring fuel prices and a weakening domestic economy.

United said it would trim U.S. capacity by 17-18% through 2009 and remove 100 aircraft from its fleet, including 30 Boeing 737s that were previously announced.

United, a unit of UAL Corporation, is the latest major U.S. airline to announce a downsizing in the face of skyrocketing oil prices that have the industry reeling. The leading carrier American Airlines took similar action to stem losses from the crisis two weeks ago.

The International Air Transport Association on Monday forecast its 230 member airlines faced losses of $2.3 billion this year due to record fuel costs that have more than doubled in the past year.

United said current fuel prices created a "challenge" of more than $3 billion, and that the measures would offset that challenge by 2009, assuming the industry as a whole takes similar actions.

"This environment demands that we and the industry act decisively and responsibly. At United, we continue to do the right work to reduce costs and increase revenue to respond to record fuel costs and the challenging economic environment," said Glenn Tilton, United's chairman, president and chief executive.

The Chicago-based airline said it expects to reduce the number of salaried and management employees and contractors by 1,400 to 1,600 by the end of the year. The work force reduction includes a previously announced reduction of 500 employees.

As part of these changes, United is eliminating its low-cost domestic carrier Ted, reconfiguring that fleet's 56 Airbus 320s by year-end 2009.

Of the 100 aircraft slated for removal, United wants to retire all 94 of its Boeing 737s, as well as six Boeing 747s. The company said the retirement of the 737s is dependent on reaching a deal with its leasing firms.

The fleet reduction is expected to retire United's oldest and least fuel-efficient jets, and will lower the company's average fleet age to 11.8 years, the airline said.

The reduction represents roughly 20% of United's operating fleet of 460 aircraft, with an average age of 13 years, at the end of 2007.

The company said fourth-quarter domestic capacity would be reduced by 14% from the same period in 2007.

International operations would be streamlined less dramatically. United said it would lower international capacity by up to 4.5% in the fourth quarter, and by 5% in full-year 2009, compared with 2007 capacity.

United Airlines currently operates more than 3,200 flights a day to more than 200 domestic and international destinations and is a founding member of the Star Alliance.

UAL reported on April 22 a pre-tax loss of $542 million for the first quarter, $305 million higher than the first quarter of 2007, driven primarily by a $618 millionincrease in fuel expenses.

The struggling airline's downsizing comes amid strenuous cost-cutting and consolidation as airlines grapple with record fuel prices, a global credit squeeze and a slowing U.S. economy.

AMR Corporation, the parent of the largest U.S. carrier, American Airlines, announced on May 21 it would cut domestic flight capacity by up to 12% during the fourth quarter and retire at least 75 aircraft.

And in mid-April Delta Air Lines and Northwest Airlines announced a merger agreement that would create the world's biggest airline.

© Wire reports

©2022 GPlusMedia Inc.

10 Comments
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due to record fuel costs that have more than doubled in the past year.

how does the doubling of the fuel cost warrant quadrupling my "fuel surcharge"? something fishy here... my most recent trip(for 2) has a whopping 95000 yen surcharge, the previous trip on the exact same route and airline on had a 12000 yen surcharge... not to mention that the ticket price it self was already double the previous flight...

guess I can't feel sorry for them... sounds like bad management.

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time to throw the peanuts out the window... toss in pillows and blankets too.

hello bus and train, good bye airplane.

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"toss in pillows and blankets too."

I'd pay some extra $$$ to see a pillowfight onboard.

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Kenji ...you're saying there are buses and trains to Europe, North America and Oz??

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Boeing/Airbus/GE/Rolls royce have to work on super energy saving, efficient lighter aircrafts,that need less thrust power pounds, of energy. They need come up with new alternative tech energy sources/new tech jet engines for aircrafts.

High energy costs, will change the outdated, world air transport titans,old believes of low energy costs and other believes of present air titans.

The present obsolute thinking systems in air transport is doomed, like obsolete administrations, need more dynamic changes, to address present woes of job loss, in air transport industry.

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How about replacing heavier and outdated cabin attendants for efficiency?

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treebeard, sounds like you got ripped by rhe japanese travel agency, not by UA directly

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as for the fuel, being a flight sim2004 buff, even a short hop from london egll to paris orly lfpo requires at least 30,000lbs of fuel, that's nearly ten cars in weight. and the cross-atlantic and pacific flights, lord, let's not go there...

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would you like a blanket sir? that'll be five dollars. and a pillow? two dollars please. headphones? that's five dollars.

the barf bags are still there sir, no they're free. (for now...)

btw - inflight airline monthly magazine cancelled.

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I may have to swim home if this keeps up...

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