- United Airlines announced this week that it’s permanently ending most ticket-change fees.
- A fee for changing a basic economy ticket will remain.
- The new policy takes effect January 1.
- United, like its peers, is struggling to attract as many passengers as possible in the face of steep cuts as it tries to remain solvent amid the coronavirus pandemic.
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Much-maligned change fees will be no more on most United Airlines flights starting next year.
The carrier said Sunday that it will eliminate the $US200 surcharge on all standard economy and premium tickets as it seeks to entice as many returning passengers as possible despite travel numbers that remain deeply depressed amid the coronavirus pandemic.
Basic economy tickets will still be subject to the fees, and passengers will have to pay any difference in fare, which could be steep if a change is made near the departure date. There’s no limit on how many times a flight can be changed, and the new policy takes effect January 1.
“When we hear from customers about where we can improve, getting rid of this fee is often the top request,” CEO Scott Kirby said in a press release.
Overall passenger traffic in the US is slowly starting to increase, according to numbers released by the Transportation Security Administration, but checkpoint counts remained at less than 30% of the prior year’s numbers during August. Worldwide, capacity is down about 40%, according to estimates from Stifel analysts.
That’s meant steep cuts at United – and virtually all of its competitors – in order to stay alive after the initial round of economic stimulus passed by US lawmakers in March. United said last week it plans to furlough 2,850 pilots this year, or about 21% of its total pilot jobs, without further government intervention. Up to 36,000 jobs could be at risk, the airline previously said.
Congress and the White House appear to remain at an impasse over further aid measures after a month of debate. Unemployment and the pandemic, meanwhile, show no signs of slowing anytime soon. The US reported 33,452 new cases on Sunday, while average daily case counts have fallen 18% in recent weeks.
July and August are usually the busiest time of year for airlines, thanks to a summer travel rush. Yet traffic is only barely above April lows, according to estimates from UBS. Business travel, long a boon for airlines’ bottom lines, doesn’t appear to be returning soon either.
In order to break even financially, United has said it needs to be flying at about half capacity.
“We believe that when demand returns, based on the work the entire United team has accomplished in cutting costs to respond to the crisis, we will be in the best position to reach cash burn breakeven, which we expect will be in an environment where demand and capacity are down around 50%,” CFO Gerry Laderman said in July.