United to Drop Shuttle Service at End of Month

UAL Corp.’s United Airlines will eliminate its United Shuttle subsidiary at the end of this month, but will continue flying many of the same routes under its main brand, the carrier announced Wednesday.

United said the shuttle service, launched in 1994 to compete with low-cost Southwest Airlines throughout the West, was another casualty of the travel slump stemming from the Sept. 11 terrorist attacks.

“The Shuttle was premised on fast turns, frequent service and minimal amenities,” United spokesman Joe Hopkins said. “Now we’re in a new environment, as far as [airport] security and the economy, and with demand being down, we don’t think it makes sense today.”

Hopkins said United Airlines or its regional service, United Express, will continue to serve “nearly all” the shuttle markets, including Burbank, Ontario and Los Angeles International Airport. However, flights are expected to be less frequent after Oct. 31. Until Sept. 11, United Shuttle offered about 468 daily flights around the West.

Hopkins said the airline was still working on its November schedule but said that flights from LAX to San Francisco will be reduced from 21 a day to 17 a day. In early September, the airline operated 33 daily flights along that route.

In other cases, smaller United Express commuter jets may replace the 737s used by United Shuttle.

Chicago-based United, the second-largest carrier, said that its systemwide September traffic, or miles flown by paying passengers, dropped 32% from a year earlier. United’s planes were 53% filled, on average, after Sept. 11, down from 72% before.

The reduction in United Shuttle’s service could be a boost for Southwest Airlines, the only major carrier not to cut service in recent weeks. Passenger loads on Southwest were down to 45% in the last two weeks of September, from 66% before Sept. 11, said spokeswoman Kirsten Nelson, but bookings for the next two weeks suggest travelers are returning.

Still, she said, it was difficult to gauge the effect of the shuttle cut. “It’s too soon to say what will happen for the entire industry in general,” she said. “We’re doing what we can to inspire the traveling public to fly, but we will have to wait and see.”

Hopkins said United will continue to compete for short-haul travelers in California and other Western states. “We’re not ceding anything,” he said. “We are still going to be very competitive with Southwest and other carriers.”

United Airlines faced financial difficulties before the Sept. 11 attacks shut down airports for two days and sharply reduced demand for air travel. The company has cut its flight schedule 31% and announced plans to eliminate 20,000 jobs.

On Monday, United announced it will pull service from six cities, including Santa Barbara, at the end of this month, and that the routes will be flown by United Express carriers in regional jet aircraft. In Santa Barbara, the new carrier will be SkyWest.

Meanwhile, United is reportedly seeking investors for its new Avolar unit, which will provide business-jet service to corporate clients.

On Wednesday, shares of UAL rose 28 cents to close at $19.33 on the New York Stock Exchange.