United Airlines passenger revenue grew 7.1 percent year over
year to $8.7 billion during the first quarter, which CEO Oscar Munoz said
"was not an easy quarter" in terms of operations. Besides "harsh
winter weather," United also faced the
grounding of Boeing 737 Max aircraft and temporary suspension
of its service to New Delhi.
United's fleet has only 14 Boeing 737 Max aircraft, which
represents 1.4 percent of the carrier's capacity, so the suspension has had
"only a modest operational impact, though that grows the longer the
grounding lasts," EVP and COO Greg Hart said. United has pulled the Max
from its schedule through early July, and adjustments include larger aircraft
on some routes to make up for lost capacity. Hart said, that "costs us
money in the short term but is the right thing to do for the customer."
Suspension of New Delhi service, due largely to the closure
of Pakistani airspace, also has extended through July 2.
EVP and chief commercial officer Andrew Nocella said United
saw strong business demand during the quarter. Performance was strongest on
transpacific routes, where passenger revenue increased nearly 5 percent,
despite little growth in capacity. Performance on transatlantic routes was
"challenging" due to "weak main cabin pricing," but premium
class transatlantic pricing was strong, he said. Domestic passenger revenue
rose 8 percent amid a 7.4 increase in capacity.
United's total traffic increased 6.5 percent year over year
in the quarter, and capacity rose 5.9 percent. The carrier's load factor
increased 0.5 percentage points to 80.9 percent. Yield rose 0.5 percent.
United reported a net income of $292 million in the first
quarter, up from $145 million in the first quarter of 2018.
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