United Airlines plans to cut $2 billion in costs, collect more fees
United Airlines announced long-term plans Tuesday to cut costs by $2 billion annually and increase revenue from passenger fees over the next four years.
The plans come as the airline continues to improve its on-time performance but struggles to meet analysts’ expectations with its recent financial performance.
“We are working together to build on United’s core strengths and deliver excellent long-term results for our investors,†said Jeff Smisek, president and chief executive of the Chicago-based airline.
The long-term financial plans were announced during the airline’s investor day in New York.
The $2 billion in annual savings by 2017 are expected to come from cutting fuel consumption by flying more fuel-efficient planes, increasing productivity with new technology and improving maintenance procedures, among other efforts, airline officials said.
Meanwhile, United officials said they want to increase by $700 million the revenue the carrier generates from bag check fees, onboard meals and entertainment and access to airport lounges and roomier seats. The airline estimates it will collect $2.8 billion in such revenue in 2013.
Smisek also announced the airline would launch a new website, following the recent launch of its mobile app. He also said the airline’s flight crews were also undergoing training to improve customer satisfaction.
“We can do better,†he said. “We can do more.â€
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