United's used aircraft speculation article
 

What used aircraft could United buy? - Airline Business

What used aircraft could United buy?
by Edward Russell on 28 October, 2014 in Airlines, Americas
United Airlines is on the market for used aircraft with a focus on narrowbodies to replace its rapidly shrinking fleet of 50-seat regional jets.

The move comes nearly two years after the Chicago-based carrier’s pilots ratified a contract that allows it to add a “new small narrowbody aircraft” to its mainline fleet and more than a year after it announced its first order for E175s as part of a plan to replace some of the more than 300 50-seat regional jets in its Express fleet.

A United Express Embraer ERJ145. (United Airlines)
A United Express Embraer ERJ145. (United Airlines)
John Rainey, chief financial officer of United, said the airline is “too reliant” on the small jets and that buying used aircraft allow it to replace some of those 50-seaters in a “financially disciplined way”, during an earnings call on 23 September.

The airline has already purchased two used 737-700s from lessors, he says. It also has plans to add another 101 E175s to the 19 in its regional fleet at the end of September by 2017.

What other aircraft could United buy?

George Dimitroff, head of valuations at Ascend, says that likely candidates are either used Airbus A320s or the 20 Air Canada Embraer 190s that are coming on the market beginning next year.

“A320s could be more available [than 737NGs],” he says. “Since supply of new ones has dried up, airlines have started absorbing older A320 inventory. As the A320neo is due to enter service sooner than the 737 Max, I could see more A320s becoming available in the next three years whereas NGs should remain tight through to the end of the decade.”

A United A320. (Edward Russell)
A United A320. (Edward Russell)
United could use the A320s on routes flown by smaller Airbus A319s or 737-700s, which could then in turn take over routes flown by 70- and 76-seat regional jets freeing those to replace 50-seaters as they exit the fleet.

The carrier configures its A319s with 128 seats, A320s with 150 seats and 737-700s with 118 seats.

There are 117 A320s in storage around the world with only 18 bound for new operators, the Ascend Fleets database shows.

“If they plan a multiple aircraft acquisition, Air Canada is the most likely source,” says Dimitroff. While narrowbodies that are already in United’s fleet are its focus, Rainey does say that the E190 is on its “radar”.

An Air Canada E190. (Air Canada)
An Air Canada E190. (Air Canada)
The Montreal-based carrier will shift 10 E190s in 2015 and 10 in the first half of 2016 to Boeing, as part of its order for up to 109 737 Max aircraft. The airframer is responsible for either leasing or selling those aircraft.

There are another 13 E190s in storage with eight of them potentially available for lease or sale, the Ascend database shows.

There is always the possibility that United could acquire used A319s, more used 737-700s or another type of narrowbody aircraft. Ascend shows that there are 33 A319s in storage with 21 potentially available for lease or sale and 19 737-700s in storage with six potentially available.

With at least 101 50-seat regional jets coming off contract in 2015 and deliveries of only about 53 E175s scheduled that year, United needs to move fast in order to maintain its capacity targets as it continues to reduce its reliance on small regional aircraft.

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That would be welcome news!

The 101 EMB175s ??? Awesome , maybe, if United pilots are flying them.

With the E190 top CA pay of $135 / hr :eek: (starting 01/2015) that will make for some pretty junior captains..
Also 1st and 2nd year fo pay is the same :eek: no raise for new hire until year 3 if hired and stay on the E190!!

Don t get me wrong, I d rather see more planes for mainline but this pay sucks..

Wow...guppy boy f/o pays more...go figure that one...what is jet blues 190 Cappy rates.

Why not just buy Frontier? You get 60 A320 series and increase market share/eliminate a competitor in one of your hubs.

No one in the top 6,000 pilots will bid it most likely since 12 yr FO on a narrowbody pays more than this and probably better schedules than these would have.

This is more of a "future job security" than benefiting most of the pilots because almost no one on the property is going to bid these except for pilots hired in the last few years that want to be a Captain on something sooner.

I predict virtually no existing seniority list pilots bid FO on this, that it be the fleet the new hires go to.

If we get them that is.

IMHO, three reasons for UA not to buy FR:

1) It's not exactly a common fleet (FR has different motors than UA)

2) One can lease 60 used Airbuses for the same market rate that FR is paying but without the expense or complications associated with buying an entire airline. Why buy the cow when there's plenty of milk on sale?

3) Potential anti-trust issues with dominant DEN market share

I was more blindly thinking the airbus and 737 would be the ones they want. The E175 are probably inevitable and I see management giving those aircraft to regional operators up the the contractual scope limits. Just like Delta does. Hopefully American pilots hold the line on scope or pushes it further down. Mainline needs to be flying these routes with mainline equipment even if they are E190s. In the end it will be better for everyone and the profession.

Who cares!!! Just get them at mainline!!!