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Air Transport: United Ready To Expand

United Airlines has no plans to retire aircraft following the devastating coronavirus crisis, saying it stands ready to resume normal services and to offer more long-haul flights to overseas destinations once travel restrictions lift.

On its quarterly analyst call on 22 July, Chicago-based United’s executives say that despite suffering the worst financial quarter in the company’s almost-100-year history, they remain optimistic their path will bear the most fruit.

“I look forward to the day when we are past the pandemic and can talk about something other than cash burn,” chief executive Scott Kirby says on his first earnings call since ascending to the CEO position in May.

On 21 July, United said it posted a $1.6 billion loss for the quarter that ended on 30 June, and that it continues burning cash to the tune of $40 million per day. That number is expected to fall to $25 million in the third quarter. The carrier is operating under the assumption that passenger demand during the current quarter will be down about 83% from last year’s figures during the same period.

“When demand returns, we will be in the best position to reach cash-burn break even,” chief financial officer Gerry Laderman adds. “There’s still a tremendous amount of uncertainty ahead” and the recovery, he says, will be “jagged”.

While United has numerous aircraft in storage, it has no plan to follow US competitors Delta Air Lines and American Airlines in streamlining its fleet with retirements. “We put a lot of aircraft into some type of storage, and we are moving aircraft in and out of storage based on maintenance cycles and engine time,” Kirby says. “When we went into this we didn’t have a plan to retire any fleet types and will hesitate to make final decisions until we better understand the length and duration of the situation.”