United Airlines to Reduce U.S. Flights

Wednesday, October 6th 2004, 10:59 am

By: News On 6

CHICAGO (AP) _ UAL Corp., parent of United Airlines, announced Wednesday it plans to slash the number of domestic flights and increase its more profitable international schedule, while at the same reducing the size of its fleet.

United says that by March 2005, it will increase the number of international flights by 14 percent and reduce its domestic flight schedule by 12 percent, shifting some of them to United Express.

The airline says the changes will result in a 3 percent overall decrease in available passenger seat miles. Officials also say international operations will account for more than 40 percent of the airline's capacity and 50 percent of its revenue.

``Fundamental changes in our industry, including ongoing high fuel costs, intense pricing pressure and continuing overcapacity, demand that we take aggressive steps now in implementing this plan to ensure that United remains competitive,'' Glenn Tilton, UAL's chairman, president and chief executive officer said in a statement.

United says it plans to reduce the fleet to 455 aircraft, 68 fewer than it flew in August. Officials say the airline has reduced its fleet by 112 aircraft, or nearly 20 percent, since 2002.

Tilton said that despite the reduction in domestic flights, United will continue to operate its five hubs in Chicago, Denver, Washington Dulles, San Francisco and Los Angeles.

He said the actions are part of United's efforts to reduce costs to competitive levels, adding that the airline is on pace to achieve $5 billion in ``annual costs improvements by 2005.''

Like other major U.S. airlines, the Elk Grove Village, Ill.-based carrier is struggling amid an unprecedented slump that has worsened this year because of soaring jet-fuel prices and deepening discount competition.

Despite slashing labor expenses last year by more than $2.5 billion annually, United seeks more than $1 billion in additional cutbacks and wants to dump pensions in order to attract financing to get out of bankruptcy _ a restructuring now in its 23rd month.