United Continental Holdings will generate billions of dollars from no-frills fares, fewer delayed flights, cost cuts and other efforts, the airline said Tuesday. The announcement, which sent United shares up nearly 3%, detailed some plans to catch up to larger rival Delta Air Lines. United said it expected an extra US$3.1b in operating income per year by 2018 from the programs, although rising wages, fuel and airport costs would partly offset that. The company also said passenger unit revenue would fall 6.5% to 7.5% in Q2 from a year earlier, compared with earlier expectations for a drop of as much as 8.5%, as sales to Latin America, Europe and the Middle East have been higher than expected. The estimate of the operating income gain marks a new push by United for transparency with investors. <br/>
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United Continental Holdings said Tuesday that it is reviewing the role of its 8 big airport hubs as part of a broader effort to close its profit gap with rivals. Analysts don’t expect the airline to close any hubs that funnel passengers through its wider domestic and international network, but it may shuffle more flying between the cities. United has wrestled with operational and service problems that have lost it lucrative corporate fliers, who have found it easier to switch to rivals. The airline has a lower market share at its big hubs compared with those operated by American Airlines and Delta Air Lines. “We’re going to refine the mission,” United CE Oscar Munoz said of the hubs, with the results to be announced later this year. <br/>