United Airlines plans to order a fleet of 100-seat jetliners from either Bombardier Inc. or Embraer SA if it can agree on terms for a two-year contract extension with pilots in expedited bargaining.
Reaching a deal would assure labour peace with a crucial union for new Chief Executive Officer Oscar Munoz and bring back some flying now done by regional partners with cramped, less- efficient 50-seat planes. For Bombardier or Embraer, a sale to United would be a significant victory as they try to place their biggest narrow-body models at the largest U.S. carriers.
“This time of senior leadership change is a unique opportunity for us,” United Senior Vice President Douglas McKeen wrote in an Oct. 2 letter to union chief Jay Heppner, in a reference to Munoz’s hiring last month after the ouster of predecessor Jeff Smisek. McKeen proposed capping the talks at 45 days.
An airline spokeswoman, Megan McCarthy, confirmed the overture but declined to discuss the possible negotiating terms at the unit of United Continental Holdings Inc. Dave Kelly, a spokesman for United’s chapter of the Air Line Pilots Association, said: “We cannot discuss offers or proposals.”
United, buoyed by an upbeat investor update on third- quarter profit, rose 7.1 per cent to US$55.97 at 10:26 a.m. in New York. Bombardier shares rose about 5 per cent to $1.64 at mid-day on Friday. American depositary receipts for Brazil’s Embraer also advanced.
Buying new 100-seat planes for mainline flying would be a lure for pilots, because it would generate jobs and appeal to their interest in cutting-edge aircraft — an affinity jokingly referred to in the industry as “shiny jet syndrome.”