(Recasts with UAL president's comments, outlook, background,
By Jeffrey Dastin
Oct 18 A glut of seats on transatlantic flights
may weigh on United Continental Holdings Inc's results
through all of 2017, the president of the third largest U.S.
carrier by traffic said on Tuesday.
Attacks in Europe have hurt travel demand, and a weaker
sterling has dampened sales to British travelers in dollar
terms, United said in a regulatory filing earlier on Tuesday.
United and other established airlines have also been forced
to cut prices as Gulf carriers such as Emirates and
budget airlines like Norwegian Air Shuttle ASA have
added flights to the United States.
As a result, President Scott Kirby told analysts on a
conference call, it was unclear whether a key revenue measure
would stop declining in 2017 for transatlantic flights.
Kirby's remarks came a day after United released
third-quarter results, which showed a 6 percent drop in pretax
income, partly due to higher wages.
For Europe, the measure, called passenger unit revenue, is
expected to fall between 7.5 percent and 10.5 percent in the
fourth quarter, according to the filing. It compares passenger
revenue to flight distance and number of seats.
For Norwegian alone, the number of one-way flights across
the Atlantic has risen 44 percent to 2,916 this year, according
to schedules as of Sept. 9 from air travel intelligence company
That is dwarfed by United's more than 22,000 transatlantic
flights, but the competition is undermining efforts by legacy
carriers to shrink capacity and firm up prices.
Transatlantic service has only accounted for 19 percent of
United's flight capacity this year.
Passenger unit revenue for flights to Asia, which account
for about 16 percent of United's capacity, will grow in 2017,
Kirby said. For Latin America, the measure will rise between 2
and 5 percent in the fourth quarter, according to the filing.
United's biggest market, the United States, is improving as
Some 43 percent of domestic routes posted a rise in unit
revenue in the third quarter from a year ago, Kirby said.
Corporate travelers are also booking more expensive last-minute
The airline plans to fine-tune how it prices flights
relative to demand, he said.
Kirby, who joined United from American Airlines Group Inc
in late August, said the company lacks an automated
process for measuring how demand forecasts compare to actual
"As great as people are, you can't do that as well as a
robust system with thousands and millions of data points," Kirby
(Reporting By Jeffrey Dastin in New York; Editing by Chizu
Nomiyama and Richard Chang)