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United Prepares For Take Off With New Destinations, Services and Fare Options
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United Continental Holdings, Inc. (UAL - Free Report) , the holding company for United Airlines and Continental Airlines, announced on Monday that they are expanding their domestic and international services after introducing the New Basic Economy fare option for Twin Cities travelers last week.
The Chicago-based United Airlines said it is expanding and adding a total of 31 new services to domestic and international destinations. One of the newly added international services is the seasonal daily flight between San Francisco International Airport and Munich Airport. On the domestic side, United is adding 13 new cities to its services, including Champaign/Urbana, IL, Columbia, MO, Cincinnati, OH and Rochester, MN. The airline also increased the number of daily flights from 15 existing destinations.
The updated domestic services will begin in June. This move looks to attract more passengers with more travel options and optimal flight times.
"Starting this summer we're offering more flights, to more destinations at more convenient times than in recent memory," said Scott Kirby, president of United Airlines. "And with bigger and more modern aircraft for many of our flights, we'll be getting you to the moments that matter most - relaxed and ready to go."
Prior to the schedule updates, United introduced the option of Basic Economy Fare, mimicking the pricing strategy of budget airlines. Starting on Feb. 21, customers traveling between Minneapolis/St. Paul and any of United’s seven U.S. hubs (Chicago O’Hare, Denver, Houston Bush International, Los Angeles, New York/Newark, San Francisco and Washington Dulles) have an additional fare option, Basic Economy, which posts the lowest fare.
"The launch of our Basic Economy product is transformational,” said Kirby. “Offering customers seeking the most budget-conscious fares United's comfortable and reliable travel experience across our unmatched network of destinations."
United expects to expand the Basic Economy Fare option across the U.S. eventually. The lowest fare option is aimed at the market of customers that look for discounted airfares like Spirit Airlines (SAVE - Free Report) and Frontier Airlines.
United isn’t the only large airline that offers additional fare options. Both American Airline (AAL - Free Report) and Delta Air Lines (DAL - Free Report) also put out similar pricing strategies. These large airlines are offering cut-rate prices and similar restrictions (use of overhead bins and advance seat assignment) but are hoping the customers will be willing to pay more to retain those privileges back.
If the expansion and pricing strategy work out, it could put a stop on United’s falling revenue. For fiscal 2016, United reported annual revenue of $36.6 billion, which is a 3.5% decrease from the year-ago period. The company also saw a 2.7% decrease in annual revenue when comparing fiscal 2015 to 2014.
United opens the market in red with 1% drop to $74.44 per share. The company is Zacks Rank #2 (Buy).
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United Prepares For Take Off With New Destinations, Services and Fare Options
United Continental Holdings, Inc. (UAL - Free Report) , the holding company for United Airlines and Continental Airlines, announced on Monday that they are expanding their domestic and international services after introducing the New Basic Economy fare option for Twin Cities travelers last week.
The Chicago-based United Airlines said it is expanding and adding a total of 31 new services to domestic and international destinations. One of the newly added international services is the seasonal daily flight between San Francisco International Airport and Munich Airport. On the domestic side, United is adding 13 new cities to its services, including Champaign/Urbana, IL, Columbia, MO, Cincinnati, OH and Rochester, MN. The airline also increased the number of daily flights from 15 existing destinations.
The updated domestic services will begin in June. This move looks to attract more passengers with more travel options and optimal flight times.
"Starting this summer we're offering more flights, to more destinations at more convenient times than in recent memory," said Scott Kirby, president of United Airlines. "And with bigger and more modern aircraft for many of our flights, we'll be getting you to the moments that matter most - relaxed and ready to go."
Prior to the schedule updates, United introduced the option of Basic Economy Fare, mimicking the pricing strategy of budget airlines. Starting on Feb. 21, customers traveling between Minneapolis/St. Paul and any of United’s seven U.S. hubs (Chicago O’Hare, Denver, Houston Bush International, Los Angeles, New York/Newark, San Francisco and Washington Dulles) have an additional fare option, Basic Economy, which posts the lowest fare.
"The launch of our Basic Economy product is transformational,” said Kirby. “Offering customers seeking the most budget-conscious fares United's comfortable and reliable travel experience across our unmatched network of destinations."
United expects to expand the Basic Economy Fare option across the U.S. eventually. The lowest fare option is aimed at the market of customers that look for discounted airfares like Spirit Airlines (SAVE - Free Report) and Frontier Airlines.
United isn’t the only large airline that offers additional fare options. Both American Airline (AAL - Free Report) and Delta Air Lines (DAL - Free Report) also put out similar pricing strategies. These large airlines are offering cut-rate prices and similar restrictions (use of overhead bins and advance seat assignment) but are hoping the customers will be willing to pay more to retain those privileges back.
If the expansion and pricing strategy work out, it could put a stop on United’s falling revenue. For fiscal 2016, United reported annual revenue of $36.6 billion, which is a 3.5% decrease from the year-ago period. The company also saw a 2.7% decrease in annual revenue when comparing fiscal 2015 to 2014.
United opens the market in red with 1% drop to $74.44 per share. The company is Zacks Rank #2 (Buy).
A Full-Blown Technological Breakthrough in the Making Zacks’
Aggressive Growth Strategist Brian Bolan explores autonomous cars in our latest Special Report, Driverless Cars: Your Roadmap to Mega-Profits Today. In addition to who will be selling them and how the auto industry will be impacted, Brian reveals 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>