United Airlines (NYSE: UAL) has begun initiatives that are expected to drive USD3.1 billion in incremental value to United by 2018 through a combination of cost savings and increased value, the company said.
The value-driving initiatives include commercial enhancements across the organization that will drive approximately USD1.5 billion of value through increased customer segmentation, updates to its MileagePlus program and modifications to its revenue management system.
The company is upgauging aircraft and installing slimline seats, combined with continued sensible cost management, which is expected to drive approximately USD1.3 billion of benefit.
The company expects to realize approximately USD300 million of value from running a more reliable airline. This operational improvement will grow United´s share of premium customers, reduce costs associated with delays and cancellations, decrease the number of passengers re-accommodated on other airlines and improve schedule utility.
Since the beginning of 2016, United said it has achieved significant improvements in its on-time arrival performance, and has achieved top-tier performance in baggage handling for 19 of the last 24 months.
United Airlines and United Express operate an average of 5,000 flights a day to 336 airports across six continents. In 2015, United and United Express operated more than 1.5 million flights carrying more than 140 million customers.