Last edit by: WineCountryUA
Please do not modify or remove
In recent days a number of threads have started touching on the impacts on UA as a business going forward due to the travel disruption of COVID-19 --- including multiple Viability / Bankruptcy / Bailout discussions. While inconceivable a few months ago, UA (and all commercial airlines) is facing challenges that are uncharted.
This consolidated thread has been created by merging a number of existing threads that trend to address essentially the same subjects.
Some thread guidelines
-- This thread / forum is for discussing UA and the UA traveler, so please focus on UA in these discussions. Other forums exist to discuss other carriers or the industry in general -- we do just UA here.
-- This thread is for discussion of how UA gets from here to its future state.
-- All the standard FT rules apply. We will have a civil, constructive, collegial discussion -- even in these turbulent times.
-- While much of this will play out in the political arena, this forum is not the place for political / OMNI discussions. Please use threads in appropriate forums for that, such as Covid-19 US tax cuts or fiscal stimulus
-- Similarly, discussions of the evils / greed of corporations or other broad societal issues are out of scope, those are for OMNI -- let's stick to discussing UA, its past and its future here
-- Please do not start new threads on these topics in the UA forum. One reason for this consolidated thread was to minimize the redundant posts in separate threads. There is plenty of room in the scope of this thread to cover all aspects of these topics. (Note things like M&A, restructuring, ... would all be in scope).
-- Please once you have laid out your position, do not repetitively re-state that opinion. It is usually a better discussion if many participate vs a few dominating the thread
On behalf of the UA Moderator Team
WineCountryUA
In recent days a number of threads have started touching on the impacts on UA as a business going forward due to the travel disruption of COVID-19 --- including multiple Viability / Bankruptcy / Bailout discussions. While inconceivable a few months ago, UA (and all commercial airlines) is facing challenges that are uncharted.
This consolidated thread has been created by merging a number of existing threads that trend to address essentially the same subjects.
Some thread guidelines
-- This thread / forum is for discussing UA and the UA traveler, so please focus on UA in these discussions. Other forums exist to discuss other carriers or the industry in general -- we do just UA here.
-- This thread is for discussion of how UA gets from here to its future state.
-- All the standard FT rules apply. We will have a civil, constructive, collegial discussion -- even in these turbulent times.
-- While much of this will play out in the political arena, this forum is not the place for political / OMNI discussions. Please use threads in appropriate forums for that, such as Covid-19 US tax cuts or fiscal stimulus
-- Similarly, discussions of the evils / greed of corporations or other broad societal issues are out of scope, those are for OMNI -- let's stick to discussing UA, its past and its future here
-- Please do not start new threads on these topics in the UA forum. One reason for this consolidated thread was to minimize the redundant posts in separate threads. There is plenty of room in the scope of this thread to cover all aspects of these topics. (Note things like M&A, restructuring, ... would all be in scope).
-- Please once you have laid out your position, do not repetitively re-state that opinion. It is usually a better discussion if many participate vs a few dominating the thread
On behalf of the UA Moderator Team
WineCountryUA
UA's Viability / Financial Future due to the COVID-19 Era [Consolidated]
#31
Join Date: Dec 2014
Programs: UA GS ,QF Plat
Posts: 686
I think this is very contingent on govt guidance,and I am sure the airlines are getting it. If regions of the US find themselves in a Lombardy/Northern Italy situation, the airline marketing departments are not in play.
#32
FlyerTalk Evangelist
Join Date: Oct 2001
Location: Austin, TX
Posts: 21,412
I take it you're not in the "there's not enough competition in the US airline market" camp, then? Because the only companies that would be buying the profitable assets are other US airlines.
#33
FlyerTalk Evangelist
Join Date: May 2012
Location: MCO
Programs: AA, B6, DL, EK, EY, QR, SQ, UA, Amex Plat, Marriott Tit, HHonors Gold
Posts: 12,809
Oh, I am, there's nowhere near enough competition. But AA contributes basically nothing at this point other than a product I don't want to fly, so let them fail and let more modern airlines come in and replace them.
#34
Join Date: Jul 2016
Programs: UA1K | *A Gold
Posts: 767
The American public sees the auto industry in a lot more favorable light than the airline industry. There was a lot more support for saving "American Made" cars than there probably is to save an industry that has repeatedly screwed over the customer at every turn.
Maybe the bad-will generated by a decade of baggage fees, minimal seat pitch, and poor customer service will be coming home to roost?
Maybe the bad-will generated by a decade of baggage fees, minimal seat pitch, and poor customer service will be coming home to roost?
#35
FlyerTalk Evangelist
Join Date: Oct 2004
Location: SAN
Programs: Nothing, nowhere!
Posts: 23,303
I said it in the AA thread and at the risk of repeating myself, the US3 are too big to fail - not just in terms of jobs but in terms of what it is they do for the US economy. They will not be allowed to fail.
#36
Join Date: Jan 2013
Location: Delaware
Programs: UA Mileage Plus, Amtrak Guest Rewards
Posts: 1,393
I'm sure this will be scant comfort to the 130,000 that work for American.
I said it in the AA thread and at the risk of repeating myself, the US3 are too big to fail - not just in terms of jobs but in terms of what it is they do for the US economy. They will not be allowed to fail.
I said it in the AA thread and at the risk of repeating myself, the US3 are too big to fail - not just in terms of jobs but in terms of what it is they do for the US economy. They will not be allowed to fail.
1. One of the big 3 failing will leave the 2 BigER, with even less competition than currently exists.
2. All 3 of them do so much for the economy. Loosing the value brougth by them as well as having that many people go unemployed at once is not something any politician wants to have happen on their watch.
#37
Join Date: Jul 2012
Posts: 1,115
I don't care about lower fares but would love to see lower load factors and less overcrowding in the clubs and the terminals in general, but for the time being, I haven't seen that really materialize. Maybe domestic load factors are lower, but not significantly enough to be noticeable for folks traveling exclusively upfront. I have heard that it is visible in the Polaris lounges, but I haven't had INTL in the past few weeks nor in the upcoming weeks.
Consider this an exercise for when the next recession strikes. As jsloan already mentioned, they simply don't need to cut prices. With their tight grip on a market that has been deprived of competition, the legacies can get by with just cutting capacity and increasing award availability, and they will still fill the remaining planes to the brim. In competitive markets like EMEA and Asia it's a whole different story and that's why you see LH slashing fares and crying for government assistance.
Consider this an exercise for when the next recession strikes. As jsloan already mentioned, they simply don't need to cut prices. With their tight grip on a market that has been deprived of competition, the legacies can get by with just cutting capacity and increasing award availability, and they will still fill the remaining planes to the brim. In competitive markets like EMEA and Asia it's a whole different story and that's why you see LH slashing fares and crying for government assistance.
#38
Join Date: Jan 2009
Location: LHR (sometimes CLE, SFO, BOS, LAX, SEA)
Programs: UA 1K
Posts: 5,893
I think the party line is that the customers who are leaving aren't price sensitive (no amount of fare slashing will get back the people who are worried about exposure to sensitive individuals after travel), so any fare cuts will just make things worse. IIRC a Southwest exec said this, and I assume it became industry consensus.
#39
Join Date: Sep 2014
Location: Houston, Texas
Posts: 206
How Much Longer Can United Bleed?
On UA247, 757-200, I counted 63 passengers LAX to EWR. It is even worse on international routes. UA143, 787-8 DEN to NRT has 6 seats sold in Polaris. Some of the southern routes to southern Cal fair a little bit better. I'd imagine UA and DL are in better shape then 90% of their competitors but how much longer can they continue to function at the current reduced level of occupancy?
#40
Join Date: May 2010
Location: AVP & PEK
Programs: UA 1K 1.9MM
Posts: 6,355
How Much Longer Can United Bleed?
Until they've alienated the last 1K and there's none left!
Until they've alienated the last 1K and there's none left!
#41
Join Date: Apr 2016
Programs: UA 1K 1MM, AA Gold, Marriott Titanium, Hilton Diamond, Hyatt Discoverist
Posts: 695
On UA247, 757-200, I counted 63 passengers LAX to EWR. It is even worse on international routes. UA143, 787-8 DEN to NRT has 6 seats sold in Polaris. Some of the southern routes to southern Cal fair a little bit better. I'd imagine UA and DL are in better shape then 90% of their competitors but how much longer can they continue to function at the current reduced level of occupancy?
#42
Join Date: Apr 2012
Location: SFO
Programs: AS MVP Gold 75K, UA Gold, Marriott LTT, Avis President's Club
Posts: 1,539
United could always use its frequent flyer program to entice people to book. However, they haven't done much of that. Seems they aren't in that much pain yet.
#43
Join Date: Apr 2013
Posts: 799
Think they are sorry they screwed us 1k's last year? A lot of us switched our flying to other airlines or partners. I guess assuming that we would all continue to pay exorbitant rates and not notice that 1k had effectively doubled its requirements was not the smartest thing to do.
BTW, the world is on sale as a result of this. I have been booking trips like a mad man at killer rates.
BTW, the world is on sale as a result of this. I have been booking trips like a mad man at killer rates.
#44
Join Date: Feb 2015
Programs: united
Posts: 1,636
You can't just shut down the airline. Travelers will eventually return. United's doing a good job at mitigating this.
#45
Join Date: Sep 2014
Location: Houston, Texas
Posts: 206
Interesting perspective. That may be the salvation if SFO and ORD are the only international gateways. You are correct on the seats sold. I do not have that answer so they could be "give aways". I note the loads on ORD/LAX seem to be much higher then those I quote in OP.