United Air board faces a long to-do list, from chairman to jets

Bloomberg

United Continental Holdings Inc. directors face a series of momentous decisions as the board gathers this week at the airline’s Chicago headquarters.
The to-do list ranges from naming a new chairman to initiating a search for a new chief financial officer. There’s also the debate about long-range planes that will make up the company’s future fleet.
The deliberations will shape the No. 3 US carrier into the 2020s, as President Scott Kirby deepens his impact on operations. He favours a simplified fleet, which would suggest adding more Boeing Co. wide-body jets such as the 787 Streamliner, said aviation consultant Robert Mann. Andrew Levy, the recently departed CFO, focussed on the most cost-effective aircraft, whether used planes or Airbus SE models, Mann said —even if they added operational complexity.
The airline has been weighing an order for more Boeing 787-8 planes to replace another aging twin-aisle model. But the decision is probably wrapped into a broader discussion of a new midrange jet family that Boeing is studying. That plane — nicknamed the 797 by outside analysts — would target many routes currently served by Boeing’s long-in-the-tooth 757 and 767, two big components of United’s existing fleet.
“I’m not sure this is the meeting where they finalise an order, but they are pretty far along in having those conversations,” Savanthi Syth, a Raymond James Financial Inc. analyst, said of a decision on new planes.
United fell less than 1 percent to $69.99 on May 22. The shares have advanced 3.8 percent this year, the only increase on a Standard & Poor’s index of five major US airlines.
That’s an improvement over last year, when United fell 7.5 percent even as the broader gauge climbed 11 percent.

Turnaround Effort
The board is meeting this week as United CEO Oscar Munoz was expected to host the company’s annual shareholder meeting on Wednesday in Chicago. The company didn’t respond to a request for comment about details of the board meeting.
Kirby and Munoz are working to improve operations, catch up to the profitability of Delta Air Lines Inc. and restore customer confidence after several public-relations debacles.
The company was pilloried in March when a dog died on one of its planes, after a flight attendant had the pet and its crate placed in an overhead bin. That came less than a year after United drew worldwide scorn when a passenger was dragged off a flight by security officials in Chicago.
Another challenge: turnover in the upper ranks. The board was expected to name a new independent chairman on Wednesday to replace Robert Milton, who said last month that he would step down. The oversight panel itself will shrink to 14 directors from 16, with Laurence Simmons retiring after more than eight years. Milton became a director in March 2016, and was named chairman three months later following a proxy battle with two hedge funds.