United Making Progress, But Rivals Are Miles Ahead

[mrfish3726]

http://www.chicagotribune.com/news/nationw...ack=2&cset=true


United has used the flexibility afforded it in bankruptcy court to slash its most crippling obligations. But industry experts say Chief Executive Glenn Tilton and his team haven't done enough to boost revenue or cut non-labor costs--the nuts and bolts of running a profitable airline.

"They're still losing a fair amount of money," said Philip Baggaley, chief airline analyst for Standard & Poor's. "They have to continue to pursue a whole range of other cost-reduction and revenue-enhancing initiatives."

But Ted, its no-frills alternative to low-cost airlines like Frontier Airlines and Independence Air, suffers from high costs and lackluster traffic. And most analysts agree that United has a lot more work to do to optimize its domestic network to produce more profitable revenue.

 

[FL030]

Ok i'll say it, what every body else is thinking on this forum. A UNITED forum.

Get a life (and some therapy so you can move on with your 'life')

SFOOV

 

[WorldTraveler]

I see several points I've made - particularly about domestic revenue and simplified operations.

In reality, if United does succeed at attracting the cash to get itself out of bankruptcy, it will likely be controlled by interests that will demand that UA do the work that AA and DL have done in order to unlock the value in United's franchise. When someone else comes in with the crowbar, it will make the last few years look relatively benign in comparison.

Let us never forget that United operates the most valuable international franchise among all US airlines - an incredibly attractive asset when other legacy airlines are becoming increasingly international. However, United has way too many assets and costs tied up in domestic operations not to make their domestic market work - and it really shouldn't be that hard to do given the location of their hubs and gateways in the world's top business destinations. United really has no choice but to quickly solve the revenue issues it faces - esp. domestically - particularly since several analysts are saying the airline industry is at the peak of the revenue cycle and revenue will only get worse from here.

Tilton may succeed at getting UA out of bankruptcy (but he also may not) but the chances of UA remaining independent and that UA employees will not face larger cuts are very small indeed.

 

[N230UA]

http://www.chicagotribune.com/news/nationw...ack=2&cset=true
But Ted, its no-frills alternative to low-cost airlines like Frontier Airlines and Independence Air, suffers from high costs and lackluster traffic.

[post="272731"][/post]​

This is an absolutely erroneous statement. He obviously doesn't have access to the actual numbers, like UAL employees do. While costs are not as LCC as they could be (i.e. not near WN, but close to F9), traffic has outperformed internal expectations for Ted and the LCO routinely runs at monthly LF above 80%, and in peak periods, above 90%.

 

[Fly]

Tilton may succeed at getting UA out of bankruptcy (but he also may not)

[post="273010"][/post]​

I guess you have yourself covered there.