Glenn Tilton's Message to Employees — Investing in Our Future
Dear fellow employee:
We have been talking with you about the progress we are making against Focus on 5, our operating agenda for the company. The work you all are doing is delivering results, improving our cost structure, our on-time performance and, importantly, our customer satisfaction.
We now have the opportunity to further leverage the good work we are doing with a fleet replacement strategy as one of the building blocks to running a great airline. This week, we sent a request for proposal (RFP) to Airbus and Boeing that could result in a potentially significant number of aircraft that could ultimately replace our widebody fleet. We will also be assessing appropriate replacement of our Boeing 757 fleet.
We have had ongoing discussions with both manufacturers for the last several years, and, as we have consistently said over that time, we will not invest in aircraft until we believe we can generate a return on our investment.
The analysis we have conducted for more than a year suggests that time may be now, and we will begin more specific discussions with the manufacturers about a potential order that could be placed as early as the fall, with deliveries extended well into the future.
The decision of whether to move ahead with new aircraft will be based on facts and analytical rigor. In addition to earning a return, any aircraft order must be financed in a way that strengthens our balance sheet over the long term and does not impact our cash position. We must also be able to retain fleet flexibility for the long term.
This work clearly presents a strategic opportunity for both United and the manufacturers, as this program will define our fleet strategy for the next 25 years. Our timing is opportune, as this is a competitive environment for manufacturers, and, if the economics are compelling, the winner will place its new generation aircraft with one of the largest operators of twin-aisle aircraft in the world.
The fleet decisions we have already made, notably retiring the B737 fleet, also positions us well as we review our options.
An aircraft order that meets the requirements we have outlined will provide the opportunity to further improve our cost structure and better our operational performance while reducing our environmental impact and creating an improved onboard experience for our people and our customers. Next-generation aircraft also provide the capability to serve new destinations and further strengthen our network.
Clearly, new aircraft provide us the opportunity to tailor and customize the customer experience, building off of the work we have done to reconfigure our international fleet.
We believe the work we now have under way has the ability to benefit all of our stakeholders - our customers, our stockholders and our people. We look forward to beginning the negotiation process with the manufacturers and to building on the good work we have accomplished together. We will keep you posted on our progress.
Glenn