Tuesday, July 18, 2017

United Airline Pushes Back From Terminal Transactions.

United Airlines ordered 35 A350-1000, but it has since pushed back the delivery of its first four of the type on order.

Reading too far into the significance of this push back would be premature. A good background report is provided by:

Flight Global: 

Considering the Boeing order fire drill is a start. United had ordered 100 Max 9's it also had ordered 65 737 Max 7's and then converted those orders with Max 8's and then converted most of its Max 9's into 100 Max 10's. The United whirlwind is a dynamic churning out orders with conversion on its mind.

The Airbus A350-1000 push back is to be expected considering trying to follow what United is trying to do. United has aging wide body 767 and 747 models. It also has a mixed fleet of Boeing and Airbus. Something has changed in its leadership thinking and has reopened consideration for other replacement strategies. Below is a view "sans" recent 737 Max orders in its fleet chart of airplanes in service and future delivery. Notice no A350-1000's or Max are listed for future delivery.
Fig. 1

United has 14 -747-400 units in its fleet. It also has 88 777's in its fleet. Consider the 767 and 757 as types to be dismissed from the fleet. Counting the 747, 757, and 767 units, the total is 142 units that would be replaced in the near term. The 737-10 Max sounds like it will replace the 757 fleet. The 777 fleet is vulnerable to the A350-1000 replacement. However, since the Airbus wide body order is for only 35 A350-1000 units, the 777X has emerged. The consideration for new 777-300ER are on the table for a relatively cheap price . Boeing needs to fill the 777-300-ER model production until the 777X is ready. The 777-300-ER door opens for United at a way cheaper price than taking delivery on the A350-1000. United fleet of 88 777's only has 14 777-300ERs in the mix of large body aircraft. 

The 777-200 are its oldest 777's in the fleet. There is an immediacy for replacing old 777's for which the A-350 1000 could not deliver in a timely manner for United's plans. Hence the A350 push back. What is not known at this time is how the 777X could play into United's fleet strategy. Boeing maybe offering United a wide body deal it can't refuse. The Airbus order now becomes an impediment to United's fleet replacement plans as it has yet to be delivered and Boeing would make room for a United deal if it would order some 777-300ER's by this fall. A wide body replacement flow from Boeing could retire the United inventory just as each 747 and 777 needs to go from aging considerations.