United aims at budget travellers with ‘basic economy’ fares

UNITED AIRLINES is making a pitch to passengers at both ends of the plane – budget flyers and luxury passengers – as it attempts to boost profits.

The airline announced Tuesday that it will sell lower ‘basic economy’ fares that don’t let buyers pick seats ahead of time and limit them to a single carry-on bag that fits under the seat. They’ll be the last to board.

The new fares will go on sale in January for flights starting after March, a spokeswoman said.

United hopes the lower fares lure passengers who pick carriers like Spirit and Frontier on price. Delta Air Lines already sells a similar, stripped-down ticket, and American Airlines plans to follow.

NEW SERVICE

Meanwhile, the airline plans to begin a new service called Polaris for premium passengers on international routes next month, and may expand it to domestic flights.

United said it expects those and other changes, coupled with cost controls, will increase profit by US$4.8 billion between now and 2020.

United Continental Holdings Inc, also said that it will postpone delivery of 61 of the 65 new Boeing 737 jets that it planned to buy and convert the orders to a new, more fuel-efficient model that Boeing calls the 737 Max. The four jets that United gets next year will be slightly larger planes than it originally ordered. The shuffle will reduce United’s capital spending through 2018 by US$1.6 billion.

CEO Oscar Munoz, who became CEO last year, made the