United Airlines Commits to Embraer E175 Regional Jets in $1 Billion Deal
Key Points
- 1Order for 19 Embraer E175 jets is valued at US$1.1 billion at list price, reinforcing United's regional fleet.
- 2Aircraft will be operated by SkyWest under a Capacity Purchase Agreement (CPA) for the United Express network.
- 3The 70-seat E175 fits critical pilot contract scope clauses, enabling continued regional network growth.
- 4Deliveries for the new three-class regional jets are slated to begin in the fourth quarter of 2024.
United Airlines has placed a substantial order with Brazilian manufacturer Embraer for its E175 regional jet. The deal is valued at over US$1 billion at list prices. This move significantly expands the United Airlines Embraer E175 fleet. It underscores the carrier’s commitment to its regional network strategy. The order was included in Embraer’s commercial aviation backlog. The E175 jet remains a cornerstone of US regional airline strategy.
Key Details of the Aircraft Order
The agreement covers 19 new Embraer E175 regional jets. The contract's value is specifically US$1.1 billion based on current list prices. This billion dollar aircraft deal was structured for operation within the United Express network. The aircraft will be operated by regional partner SkyWest, Inc. under a Capacity Purchase Agreement (CPA). Deliveries of these new 70-seat aircraft are scheduled to begin in late 2024. Each jet will feature a three-class configuration for passenger comfort.
Strategic Fleet Modernization
This United Airlines aircraft order is vital for United Airlines fleet modernization. The E175 is the dominant aircraft in the 70-76 seat segment. Embraer commands over 80% of the market share in this category. The jets will replace older, less efficient aircraft in the United Express fleet growth. This includes some older 70-seat jets currently in service. The E175 offers better fuel efficiency and an improved passenger experience.
The Role of Regional Aviation
Regional jets like the E175 are crucial for connecting smaller markets. They feed traffic into United Airlines's major hubs. The E175 platform is often called the "backbone of North American regional aviation". Its size is strategically important due to pilot contract limitations. These union agreements, known as scope clauses, restrict major airlines. They limit the number and size of aircraft regional partners can fly. The 70-seat E175 fits perfectly within these existing contractual limits. This ensures continued growth without violating labor agreements. The order highlights the ongoing reliance on regional carriers. This reliance is expected to continue for the foreseeable future.
Industry Impact and Outlook
The order provides a significant boost to Embraer commercial aviation. It reinforces the company's strong position in the regional jet sector. For passengers, the new aircraft mean a better onboard product. The three-class configuration offers more premium seating options. For the industry, the deal signals confidence in regional jet market expansion. However, the industry still faces challenges. Pilot shortages continue to impact regional operations. The cost of new aircraft also remains a factor. This United Airlines Embraer E175 commitment shows a long-term investment. It secures essential regional connectivity for the carrier's network.
- Order for 19 Embraer E175 jets is valued at US$1.1 billion at list price.
- Aircraft will be operated by SkyWest under a Capacity Purchase Agreement for United Express.
- The 70-seat E175 is key to United's regional strategy due to pilot contract scope clauses.
- Deliveries are scheduled to begin in the fourth quarter of 2024.
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Ujjwal SukhwaniAviation News Editor & Industry Analyst delivering clear coverage for a worldwide audience.
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