United Airlines reportedly stated it is currently updating its B777 aircraft configuration, to improve passengers' onboard experience (Chicago Tribune, 02-Apr-2010). United mechanics are currently overhauling the first of 46 B777s with the new configuration, in which the size of Premium cabins is being reduced, while lie-lat seats are being placed in Business and First Class cabins. 20 seats are also being added to Economy Plus cabins, as well as an additional three in Economy. Economy seat pitch will not be reduced, but the 2-5-2 seating configuration is being replaced with a 3-3-3 configuration, to allow for a new in-flight entertainment system. The carrier stated the new configuration is a reflection of many companies now requiring employees to fly in Economy, rather than Business.
United Airlines updating B777 aircraft configuration
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United, Delta, American Airlines: Cost creep, rising oil prices put pressure on the Big 3 to deliver
For the large three global US network airlines – American, Delta and United – the final quarter of 2016 offers some hope of negative unit revenue trends starting to stabilise, a welcome sign after two years of declines. But those positive developments are occurring against a backdrop of rising fuel costs and overall cost creep for those airlines, as labour expenses rise in the face of new collective bargaining agreements they have achieved.
Although each airline has offered a nuanced interpretation of domestic trends, the general consensus is that dynamics began to improve in Aug-2016 as close-in yields started to strengthen. After enduring tough conditions in Latin America driven by Brazil’s recession, American and Delta posted positive passenger unit revenues (PRASM) in their Latin entities in 3Q2016, and expect further improvement. Higher industry capacity is creating challenges for those airlines in the Atlantic and Pacific, but generally it seems that the path of unit revenue declines in those regions should moderate progressively.
Delta is aiming to post positive PRASM early in 2017, and American believes it can reach a positive result in total unit revenues in 1H2017. For now United is not offering a specific time period for a reversal of negative PRASM, but feels confident it is heading in the right direction, given the changing dynamics in certain areas of its network.
Air New Zealand defends Australia-USA transit market as Qantas plans further USA growth with 787-9s
Air New Zealand is turning up the volume. For years the airline had a tidy, under-the-radar business carrying transit passengers between Australia and the US over its Auckland hub. Air NZ is now directly targeting the Australia-USA market with a sales and marketing push that includes an advertising campaign called "Better Way to Fly". CEO Christopher Luxon said in a statement that "capturing just a little bit more of that market would see hundreds of thousands more Aussies flying with us to North and South America...Many Australian travellers still think of us as a trans-Tasman carrier and that’s a perception we’re determined to change."
The shift that Air NZ envisages is being sought now – and not five or even 10 years earlier – largely because of external factors and competition. Air NZ's marketing may suggest an opportunistic push, but the reality is Air NZ is on the defensive. In the Australia-Americas market competitors have lowered their costs, adding city pairs, product improvements and significant capacity growth. 2017 and 2018 are expected to mean even more growth as a resurgent Qantas adds 787-9 services between Australia and the US, and in particular – to Dallas.