AP – United Airlines said on Wednesday it earned more than USD1 billion in the second quarter despite cancelling 3,800 flights in the last two weeks of June, when it struggled to recover from storms that crippled its key operation in the New York City in the United States (US).
United indicated that it sees no let-up in strong demand for tickets: It raised its forecast of third-quarter and full-year profit.
The report underscores how airline revenue and profits are soaring as travel bounces back after the pandemic.
Big carriers like United are benefitting especially from the strong recovery in international travel after the lifting of COVID-19-related restrictions. Last week, Delta reported record quarterly revenue and profit.
From April through June, more than 2.4 million travellers per day on average went through US airport security checkpoints, virtually identical with numbers from the same period of 2019 and a 10-per-cent jump from last year.
Airlines at times have struggled to handle those crowds, although they have hired enough new workers to replace ones they encouraged to quit during the COVID-19 pandemic. United has been hit the hardest this summer. In late June, United cancelled nearly four times as many flights as any other US carrier, according to data from FlightAware. Many of those cancellations occurred at United’s hub in Newark, New Jersey.
Chief Executive Officer Scott Kirby blamed the Federal Aviation Administration for restricting flights at the airport, then apologised for taking a private flight out of the New York area while thousands of United passengers were stranded.
Since then, Kirby has said the airline must consider reducing its schedule in Newark to limit future disruptions.
The airline is also getting a huge boost from cheaper fuel. United spent USD1 billion less on fuel than it did in the same quarter last year, when fuel was its largest single expense.
Now the biggest cost is labour. United’s spending on pay and benefits jumped USD874 million, or 31 per cent, to USD3.71 billion in the latest quarter.
Just last weekend, the airline agreed to a USD10 billion deal that, if ratified by pilots, will raise their pay by up to 40 per cent over four years.
