CHICAGO (Reuters) - United Airlines canceled dozens of flights on Wednesday, adding to the more than 1,100 cancellations since December 23 that the No. 2 U.S. carrier blamed on weather but its pilots blamed on insufficient staffing.
By Kyle Peterson
CHICAGO (Reuters) - United Airlines canceled dozens of flights on Wednesday, adding to the more than 1,100 cancellations since December 23 that the No. 2 U.S. carrier blamed on weather but its pilots blamed on insufficient staffing.
UAL Corp's <UAUA.O> United has canceled more than four times as many flights as its closest competitor, AMR Corp's<AMR.N> American Airlines, since a December 23 storm hit its Chicago hub.
United had canceled 58 flights as of Wednesday afternoon, compared with 78 on Tuesday. The cancellation rate, while lower than the peak rates last week, is tracking well ahead of rivals, according to data from FlightStats, which tracks airline performance.
!ADVERTISEMENT!"The majority of today's cancellations are as a result of continued recovery from yesterday's weather," said UAL spokeswoman Megan McCarthy.
"Weather for December was the worst in our history," McCarthy said. She said United was "uniquely impacted" by fog and snow storms in its hub cities of Chicago and Denver.
United's pilots union, however, said the airline was simply understaffed during the hectic holiday travel season. Other experts also doubted UAL's explanation but declined to speculate on the airline's staffing needs.
"Management is feeling the pressure from consumers and the pilots to explain what happened," said Joe Schwieterman, transportation expert at DePaul University.
Between December 23 and December 31, United canceled 1,033 flights, compared with 243 cancellations by American, which also has a hub in Chicago, FlightStats said.
"United's cancellation rate during the holidays was off the charts compared to its rivals who serve the same general markets," said David White, FlightStats' vice president of business development, in an e-mail.
STAFFING CONCERNS
United's pilots union blamed management for the poor operational performance over the holiday period.
"They have pared employee staffing to the bare minimum, making them unable to respond to even well-anticipated weather events," the Air Line Pilots Association (ALPA) said in a newspaper ad that ran on Sunday.
United disputed ALPA's claim, saying it had 115 more pilots in December than it did a year earlier. That equates to a 2 percent increase in the number of pilots, despite a 1.5 percent decrease in flying, United's McCarthy said.
"The fact is that we have better pilot staffing levels than we've had in recent years," she said.
ALPA has long criticized UAL management for labor cost-cuts during the airline's bankruptcy, which ended in February 2006. UAL used its court protection to cut its work force by 25 percent and dump its underfunded pensions on government pension insurers.
TOUGH OPERATING ENVIRONMENT
The cancellations, as well as an extremely high number of delays over the last two weeks, underscore a tumultuous operating environment as the industry contends with soaring fuel costs and the prospect of weaker travel demand in a softening U.S. economy.
The airline industry has been struggling to extend a recovery that began in 2006 with airline cost-cutting and a series of fare increases.
With oil prices touching a record $100 a barrel <CLc1> on Wednesday, airline shares fell sharply. UAL fell 10.7 percent to $31.83 on Nasdaq. Northwest Airline Corp <NWA.N> fell 9.7 percent to $13.10 on the New York Stock Exchange. Delta Air Lines <DAL.N> fell 7.9 percent to $13.71 on the NYSE.
"I would attribute today's action in airline shares to the rise in oil prices and concerns about the economy," said Standard & Poor's analyst Jim Corridore.
In light of the tough market conditions, airlines can ill afford operational snafus that could increase costs and alienate travelers. Last year, JetBlue Airways Corp's <JBLU.O> reputation for customer service was sullied when a winter storm forced it to cancel more than 1,000 flights.
United's performance in December and on January 1 was not in that league, however, as many of its cancellations were made in advance of the weather to mitigate the impact on travelers.
(Additional reporting by Chris Reiter, editing by Gerald E. McCormick)
