United Airlines Evaluates Airbus A350 Order in Strategic Fleet Renewal
United Airlines is revisiting its decision on the long-standing order for Airbus A350 aircraft as part of its comprehensive fleet renewal strategy. CEO Scott Kirby has raised international aviation concerns, describing it as a “trade deficit” needing governmental attention.
Delays in Airbus A350 Deliveries
The airline has deferred the delivery of its Airbus A350-900 units until 2030 and beyond. Kirby emphasized to pilots the necessity of deciding on the replacement of aging Boeing 777 aircraft by the end of this year. This decision weighs economic, political, and pilot training implications against its extensive backlog of Boeing 787 orders.
Evolution of the Airbus A350 Order
- 2009: Initial order for 25 Airbus A350-900s
- 2013: Order revised to 35 A350-1000s
- 2017: Further adjustment to 45 A350-900s
Despite repeated deferrals, the A350 order remains active with first deliveries now expected in the next decade. Industry experts had anticipated cancellations, especially given United’s substantial investment in the Boeing 787 Dreamliner program, which still includes over 140 units yet to be delivered. However, Kirby confirmed that the A350 is still under consideration.
Advantages of the Rolls-Royce Engine Deal
United had earlier signed a Rolls-Royce engine agreement, initially seen as unfavorable. Yet, with rising inflation, supply chain challenges, and increasing travel demand, this contract now appears beneficial. This agreement could notably enhance the A350’s operating economics, causing Rolls-Royce some reluctance in fulfilling the contract terms.
Fleet Transition and Pilot Retraining
United’s strategy coincides with the phase-out of its Boeing 757s and 767s, necessitating pilot retraining irrespective of the replacement aircraft chosen. Given the inevitability of retraining costs, Kirby proposes considering the introduction of the A350s instead of indefinite postponement. By the end of the decade, United plans to fully retire the 767 fleet, prompting a timely reassessment of the Airbus order.
Current commitments include 50 Airbus A321XLRs intended as 757 replacements, leaving the 767 and 777-200 models as prominent candidates for renewal.
Addressing the ‘Trade Deficit’
Kirby has been vocal about the U.S. experiencing a “trade deficit” in long-haul aviation. He points out that foreign carriers operate two-thirds of such international seats, though 60% of passengers are U.S. citizens. Kirby attributes this to foreign airlines benefiting from subsidies and strategic advantages, unlike U.S. carriers. This narrative aligns with prevailing political themes advocating for “fair trade.”
However, the U.S. airline sector still receives substantial governmental support, evidenced by over $100 billion in pandemic-related grants and loans, alongside favorable regulatory conditions.
The Airbus A350 vs. Boeing 787
While United’s Boeing 787 order remains critical for long-haul operations, the Airbus A350 presents a potentially complementary option due to its larger capacity and extended range, suitable for markets less efficiently served by the 787. Opinions diverge on whether United will balance Airbus acquisitions with further Boeing purchases to foster political and industrial favor.
As A350 deliveries are earmarked for the 2030s, decisions could be influenced as much by Washington’s optics as by practical operational factors.
Conclusion
United Airlines is navigating complex choices about its Airbus A350 orders amidst CEO Scott Kirby’s emphasis on foreign carrier dominance in long-haul operations. The airline faces the necessity to renew over 120 widebody aircraft, including 767s and the initial batch of 777-200s. As United continues to balance fleet needs with strategic concerns, the decision on its Airbus A350 order remains pivotal.
