United Airlines CEO Scott Kirby Talks Business and Geopolitics
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What is the main topic discussed in this episode?
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Bloomberg Audio Studios. Podcasts. Radio. News. Yesterday, after the bell, United Airlines reported earnings. This follows Delta reporting earnings. United beat expectations across the board. Joining us now to discuss is the Chief Executive Officer, Scott Kirby, right before that earnings call with investors. Scott, thank you so much for being with us. I want to start on the transformation in the airline industry. Just this incredible focus on revenues coming from premium and loyalty. Really, they doubled relative to the pace that you're seeing in the main cabin. Can you give us some more color about why that is?
Well, you know, we've spent a decade at United trying to build what we call a brand loyal airline to get customers, but really all customers, to choose to fly United, to get out of the commodity cycle of the business. And 2025 is a great year for that. Despite all the headwinds, United Airlines was the only airline to grow EPS last year. We've started with a really strong booking environment. in 2025 it really is the culmination of this brand loyal strategy and yes that's over indexes to the premium those are the customers that fly the most and have the most loyalty and that part of the business has done the best but you know we've seen pretty significant strength in the in the back of the airplane as well we had seven percent growth in basic economy last year and we've been investing there you know i think one of the cool things we recently announced is we're the only airline in the country that has ovens in coach
And so we're going to be serving hot meals in coach for customers that pre-order, give the customers the ability to pre-order hot meals. And that applies obviously to the entire cabin and is not just focused on premium. Premium has over-indexed, but really we're seeing strength across the board.
That strength across the board, and this is what I was trying to get into, and I'd love your color on this. How much are the main cabin customers increasingly cost conscious, even as the more premium and loyalty customers seem willing to pay for quality, for the perks that come along with some of your new offerings?
But while we index higher end kind of across the board, even in main cabin, so we're not a perfect indicator of the economy. You know, one of the things I would say is customers are across the board willing to pay for better product service, better technology, better experience across the board. But also I'd add like airline traffic, you know, in 2025 airfares were 2% lower than they were in 2019. So we've been deflation, inflation is about up about 23% over that period. We've been deflationary and our costs in many cases have grown even more, you know, 50% increase in airport costs. It's sort of the norm across the industry. So airfare remains a pretty good value, pretty good travel for customers.
That's put a lot of pressure on the low end of the airline industry, as you can see, but air travel remains a good value. And we are increasingly finding that really across the board, customers are willing to pay for at least a little bit for a better experience.
You know, that deflation that you were talking about, how much do you need to see consolidation at the lower end of the offerings in order to actually bring supply into balance?
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Chapters
4 chapters
1
What is the main topic discussed in this episode?
0:00–4:37
2
What insights does Scott Kirby share about United Airlines' earnings report?
4:37–5:44
3
How is United Airlines transforming its business model?
5:44–6:30
4
What strategies is United Airlines implementing to enhance customer loyalty?
6:30–9:10
Speakers
4 identifiedMore from Bloomberg Talks
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