Analysts expect United to benefit from labour problems at American Airlines

Victoria
By Victoria September 26, 2012 14:13

Analysts expect United to benefit from labour problems at American Airlines

Although 2012 has been below expectations for United Continental (UAL), the labour troubles at American Airlines stand to help its rival claw back market share. American has been suffering from labour problems as it attempts to restructure under bankruptcy protection. A bankruptcy court judge allowed the airline to cancel its pilot contract earlier this month, forcing many pilots to call in sick and an abnormally high number of maintenance requests have also been submitted.

Although the union denies this is a “sickout”, the pilots’ actions have forced American to cancel as much as 5% of its scheduled flights on some days.

The airline’s on time rating has also suffered due to the additional maintenance requests, with on time performance below 50% for Sunday, Monday, and Tuesday of last week. The airline is still suffering from delays and cancellations event though it has cut its September/October capacity by 2%.

As passenger become more frustrated with American problems, there is the expectation that United will be able to win customers back to its brand. Although Southwest, JetBlue, and Delta will be fighting to reap the benefits from American’s misfortunes also.

Victoria
By Victoria September 26, 2012 14:13
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