Wednesday, January 15, 2014

An interesting piece of United News as it relates to IAH

United Cancels $1.08 Billion of Airbus Orders in Fleet Shift. Mary Schlangenstein and Robert Wall, Bloomberg BusinessWeek

United Continental Holdings Inc. (UAL:US), the world’s second-biggest airline, canceled orders for 12 Airbus SAS single-aisle planes valued at about $1.08 billion that the carrier said were no longer needed. The move affects six Airbus A319s and six A320s, Christen David, a spokeswoman for Chicago-based United, said today by e-mail. The A319s have a list price of $85.8 million each, while the A320s retail for $93.9 million, according to an Airbus statement yesterday. Airlines typically buy at a discount.


Remember that, back in 2012 when United was up-in-arms (allegedly) over the Southwest/Hobby(HOU) International terminal deal United stated that it was moving newer 737's to Chicago(ORD) and Denver(DEN) and shifting older A319/20 metal to IAH where it was establishing a base.

Now it appears that United has decided they don't need any new Airbus' single aisle aircraft and are going to continue the (glacially-paced) retrofits on the old ones. (In most cases, these are the much-older legacy United planes)

Not that the elmination of a 12 plane order is going to be felt at IAH, but it does speak volumes about where United's corporate focus stands right now. I think it's safe to say that IAH is now viewed as a "regional" hub rather than a key hub in United's network.

And they're treating it as such, except for the 787, which is still having trouble with batteries. You can't read too much into the 787 base staying at IAH, Continental (and United) spent a lot of money installing it, and it would take even more money to relocate it elsewhere.