How United Airlines is trying to plan around the pandemic
When the coronavirus pandemic wiped out travel in the spring, United Airlines slashed its flight schedule, salted away aircraft in the New Mexico desert and parked planes at hangars around the country.
That was the easy part.
Now, with what is normally the peak summer season behind it and travel proceeding in fits and starts, the airline is continuing to fine-tune every facet of its business, from maintenance to flight planning, as it tries to predict where a wary public will fly, a challenge even in the best of times.
“We can really throw away the crystal ball, which was hazy to begin with,” said Ankit Gupta, United’s vice president for domestic network planning.
This month, the airline announced a $1.8 billion loss during the third quarter, with revenues down 78% compared to the same period a year ago. While United said it was ready to “turn the page” from survival to rebuilding, it said it didn’t expect a recovery to begin in earnest until 2022.
Passenger volumes for U.S. airlines are down about 65%, according to an industry group, and major carriers have taken on enormous debt as they lose billions of dollars each month. After hopes for a second congressional rescue package faded last month, United furloughed more than 13,000 workers and American Airlines furloughed 19,000.
But while every airline is struggling, each struggles in its own way. United relies far more than its rivals on international travel, which is deeply depressed and is expected to take far longer than domestic travel to bounce back. Lucrative business travel will be slow to return, too, and the airline said this week that it had amassed more than $19 billion in cash and other available funds to cope with the downturn.
“We’ve got 12 to 15 months of pain, sacrifice and difficulty ahead,” United’s chief executive, Scott Kirby, said on an earnings conference call Thursday. “But we have done what it takes in the initial phases to have confidence — it’s really about confidence — in getting through the crisis.”
In navigating that path, the airline has focused on finding savings while positioning itself to serve the few passengers who still want to fly. When the virus devastated travel in March and April, the airline took hundreds of planes out of circulation. Among the first to go were twin-aisle jets used for international flights, which dropped early as countries closed borders. Single-aisle planes — the kind used for domestic routes — followed soon after.
About 150 planes were sent to long-term storage in Roswell, New Mexico — yes, that Roswell — where the dry conditions are better suited for long-term aircraft preservation. Many others were parked at United’s hub airports in and near cities including Chicago, Washington and Newark, New Jersey, where technicians could more easily get them back into service if needed.
Since July, United has brought back over 150 of the planes that the airline or its regional carriers had grounded, it said Thursday. About 450 are still stashed away, but must be maintained in a way that allows flexibility.
To get it right, Tom Doxey, United’s senior vice president for technical operations, and his team consult models created by computer scientists and solicit guidance from maintenance crews. Generally, two considerations loom large: how soon a plane will need substantial maintenance and the likelihood that it will be among the first to start flying again.
Fortunately for Doxey and United, some travel trends have started to emerge. Most of the people still flying are staying within the country, visiting friends and relatives or vacationing outdoors. If airline planners are right, travel to powdery ski slopes in the West may pick up soon, too. Those flights would put United’s single-aisle planes to use.