United Airlines Said to Plan Los Angeles Push in Comeback EffortBy
Kirby tells pilots he’s looking for additional terminal space
Carrier has fallen behind rivals at busiest West Coast airport
United Continental Holdings Inc. is targeting a major expansion at Los Angeles International Airport in an effort to reverse a slide that’s left the airline languishing behind its biggest rivals at the busiest West Coast hub, said people familiar with the plans.
President Scott Kirby told United pilots this month that the company needs more space and is studying plans to claim most or all of a future terminal, said the people, who asked not to be identified because the information is private. He didn’t discuss a timetable, the people said.
United, once the leader in Los Angeles, has dropped to No. 3 behind American Airlines Group Inc. and Delta Air Lines Inc. United Chief Executive Officer Oscar Munoz is trying to win back passengers at key airports as part of a broader renewal effort, which includes plans to cut costs and catch up with Delta’s industry-leading profits. Delta and American have been building international gateways in Los Angeles to compete with United’s lucrative hub in San Francisco.
“Domestically, they would be doing it for the local market,” Craig Jenks, an airline consultant, said about United. “Internationally, they would simply be doing it as a kind of blocking maneuver to counter American and Delta.”
Delta, which announced a $1.9 billion project to relocate among terminals at the airport, known as LAX, handles almost more than 16 percent of passengers compared with United’s 15 percent. American leads the pack with 20 percent and has announced five new Pacific destinations from Los Angeles since late 2015.
Kirby, who joined United from American in August, discussed his vision for Los Angeles at a meeting of the Air Line Pilots Association in Rosemont, Illinois, earlier this month. He told pilots he’s confident the airline could win a major position or full use of a future terminal, people who attended the meeting said. Kirby also referred to a plan for what he called a new “Terminal 9” without providing details, the people said.
Los Angeles World Airports has held broad discussions with the Chicago-based carrier, said Nancy Castles, a spokeswoman for the airport operator. She didn’t provide details. United spokeswoman Megan McCarthy declined to say what the two sides have talked about.
“We are in discussions with LAWA about the future of the airport,” McCarthy said. “We continue to invest significantly in LAX and are currently renovating all of our customer-facing space at the airport.”
United has 22 gates in Terminals 7 and 8, though two of the gates are closed for renovations. The airline is spending more than a half-billion dollars to spruce up its existing ticketing and gate areas and frequent-flier clubs there.
Any expansion by United would add to a flurry of construction at LAX. A new structure called the Midfield Satellite Concourse will add 11 gates in its first phase, while the airport also is considering a proposed new Terminal Zero and starting environmental reviews for a small Terminal 1.5. The latter building will have extra space for ticketing and baggage check-in but no additional gates, Castles said.