United Airlines slashes 2024 aircraft delivery plan as Boeing crisis leads to delays

United
Airlines
on
Tuesday
cut
its
aircraft-delivery
expectations
for
the
year
as
it
grapples
with
delays
from


Boeing,
the
latest
airline
to
face
growth
challenges
because
of
the
plane-maker’s
safety
crisis.

United
expects
to
receive
just
61
new
narrow-body
planes
this
year,
down
from
101
it
said
it
had
expected
at
the
beginning
of
the
year
and
contracts
for
as
many
as
183
planes
in
2024.

“We’ve
adjusted
our
fleet
plan
to
better
reflect
the
reality
of
what
the
manufacturers
are
able
to
deliver,”
CEO
Scott
Kirby
said
in
an
earnings
release. “And,
we’ll
use
those
planes
to
capitalize
on
an
opportunity
that
only
United
has:
profitably
grow
our
mid-continent
hubs
and
expand
our
highly
profitable
international
network
from
our
best
in
the
industry
coastal
hubs.”

United
said
it
plans
to
lease
35
Airbus
A321neos
in
2026
and
2027,
turning
to
Boeing’s
rival
for
new
planes
as
the
U.S.
manufacturer
faces

caps
on
its
production
and
increased
federal
scrutiny.
In
January,
United
said
it
was
taking
Boeing’s
not-yet-certified
Max
10
out
of
its
fleet
plan.
The
airline
said
it
has
converted
some
Max
10
planes
for
Max
9s.

It
lowered
its
annual
capital
expenditure
estimate
to
$6.5
billion
from
about
$9
billion.

United
is
also
facing
a
Federal
Aviation
Administration
safety
review,
which
has
prevented
some
of
its
planned
growth.
A
spokeswoman
told
CNBC
earlier
this
month
that
the
carrier
will
have
to
postpone
its
planned
service
from
Newark,
New
Jersey,
to
Faro,
Portugal,
and
service
between
Tokyo
and
Cebu,
Philippines.

United
earlier
this
month
postponed
its
investor
day,
which
was
scheduled
for
May, “because
our
entire
team
is
focused
on
cooperating
with
the
FAA
to
review
our
safety
protocols
and
it
would
simply
send
the
wrong
message
to
our
team
to
have
an
exciting
investor
day
focused
primarily
on
financial
results.”

The
airline
said
it
would
have
reported
a
profit
for
the
quarter
if
not
for
a
$200
million
hit
from
the
temporary
grounding
of
the
Boeing
737
Max
9
in
January.

The
FAA
temporarily
grounded
those
jets
after
a

door
plug
blew
out
minutes
into
an


Alaska
Airlines
flight,
sparking
a
new
safety
crisis
for
Boeing
and
slowing
deliveries
of
its
planes
to
customers
including
United,


Southwest
and
others.

The
airline
posted
a
net
loss
of
$124
million,
or
a
loss
of
38
cents
a
share,
in
the
first
quarter
compared
with
a
$194
million
loss,
or
59
cents,
a
year
earlier.
Revenue
rose
nearly
10%
in
the
first
quarter
compared
with
the
year-earlier
period
to
$12.54
billion,
with
capacity
up
more
than
9%
on
the
year.

Here’s
what United
reported
in
the
first quarter
compared
with
what
Wall
Street
expected,
based
on
average
estimates
compiled
by
LSEG:

• 
  Loss
  per
  share:
  15
  cents
  adjusted
  vs.
  a
  loss
  of
  57
  cents
  expected
• 
  Revenue: $12.54
  billion
  vs.
  $12.45
  billion
  expected

The
airline
expects
to
post
earnings
of
between
$3.75
and
$4.25
in
the
second
quarter,
ahead
of
analysts’
estimates
of
about
$3.76
a
share.
Airlines
make
the
bulk
of
their
profits
in
the
second
and
third
quarters,
during
peak
travel
season.

The
carrier
also
reiterated
its
full-year
earnings
forecast
of
between
$9
and
$11
a
share.

United’s
shares
were
up
more
than
4%
in
after-hours
trading
on
Tuesday.

United
executives
will
hold
a
call
with
analysts
at
10:30
a.m.
ET
on
Wednesday.