United Airlines Holdings makes largest aircraft order in its history

United Airlines Holdings Inc. (NASDAQ: UAL) unveiled its largest-ever airplane order of 270 narrow-body jetliners from Airbus SE (ESBBSE:AIR) and Boeing (NYSE: BA) as the company looks to expand in the post-pandemic era, CNBC reported.  The airliner aims to capture more travelers, especially high-paying ones in coastal hubs.

United Airlines expanding its fleet

According to the company’s chief commercial officer Andrew Nocella, the A321neo and Max 10 aircraft, which are the most significant models in the series, will help United Airlines expand in its most important markets markets with capacity limits. The company plans to grow in places such as Chicago and  Denver with an annual systemwide growth target of 4%-6% in the coming years.

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United’s order includes 200 Boeing Max aircraft, with 150 of those being from the Max 10 family while the remaining are from the famous Max 8 family. United will separately purchase 70 A321neo planes from Airbus. All combined, the price tag could total $30 billion although bulk discounts could put the final cost closer to $15 billion,  Rob Morris, global head of consultancy at Ascend by Cirium, told CNBC.

The airline said it plans to introduce seatback entertainment and roomier chairs as part of a broad growth strategy, reversing an initial goal. United Airlines CEO Scott Kirby said on CNBC:

“What we’re trying to do is upgrade the whole customer experience and the single seat, 50 class, 50 seat regional Jets or some of the toughest customer experience. And at United, we really needed to get that to be a world-class, first class product.”

From oldest fleet to one of the youngest

CNBC’s airline industry expert Phil LeBeau noted that United has the oldest fleet in the industry with an average aircraft age of 16 years. But as part of the company’s buying spree, it will take delivery of one new plane every three days in 2023. Kirby commented that he is not sure of any other airliner in history that has “even come close” to that pace of delivery.