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United Airlines Defers Plane Deliveries To Beyond 2022 As Air Travel Remains Muted

Courtesy of ZeroHedge View original post here.

United Airlines Holdings Inc. said Wednesday morning, all new aircraft deliveries due in 2022 have been deferred as air travel for the next several years will remain depressed. The Chicago-based company also said 32,000 employees have volunteered for a temporary leave of absence.

Earlier in the morning, United Airlines' CEO Scott Kirby told CNBC that estimated sales would not recover in a V-shaped formation until there's a proven vaccine for COVID-19. 

"Our guess is that revenue will get to about 50% of what it was in 2019 in a pre-vaccine world," Kirby told CNBC. Once we get past a vaccine and it is widely distributed, we will quickly recover towards 100%, but our guess is we are going to plateau at 50% until we get to a vaccine."

On Tuesday, the airliner reported revenues of $1.48 billion in 2Q20, an 87% crash from $11.4 billion during the same time last year. It said capacity in 3Q would be down 65% compared with the same quarter a year ago.

In early July, United Airlines warned 36,000 employees were at risk of losing their jobs in October when the federal payroll stimulus expires. 

Shares of United Airlines slid nearly -2% on Wednesday. 

On Monday, the Transportation Security Administration (TSA) published new passenger data from US airports, showing the first slump in weekly air travel since April. 

h/t CNBC 


 

United Airlines' deferment of planes due in 2022 suggests the travel and tourism industry will remain muted for a couple of years. It also implies there's no V-shaped recovery in the economy this year


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