United Continental Holdings (UAL) recently announced that it will invest approximately $550 million in revamping its fleet.
The carrier is looking forward to enhancing the storage capacity of the planes along with other infrastructural upgrades.
United Continental plans to double the overhead storage space in over 150 aircraft and add flat-bed seating on approximately 62 long-haul planes. Other amenities will include streaming wireless video on its 747-400 aircraft.
United Continental is also in the process of re-branding its fleet, offering Wi-fi in more than 200 Continental Boeing 737 and 757 aircraft through LiveTV and reconfiguring its international aircraft with new flat-bed seats in first and business classes. The fleet will also improve customer experience on-board with winglets, direct TV in every seat back, and the new Boeing Sky Interior.
United Continental operates one of the most fuel-efficient fleets in the industry with luxurious seats and other activities. The carrier expects to take delivery of 25 Boeing 787 Dreamliner aircraft, becoming the first U.S. airline to receive it. This milestone move will take the company a step ahead of its peers Delta Air Lines Inc. (DAL) and AMR Corporation (AMR). Additionally, the company will also deploy 25 Airbus A350XWB aircraft from 2016 to 2019.
Continental expects to take delivery of 84 new aircraft (59 Boeing 737 and 25 Boeing 787) from April 2011 to 2016. Continental took delivery of two Boeing 737 aircraft in March and is expected to take delivery of two more in the remainder of 2011.
We maintain our long-term Neutral recommendation on the stock supported by a Zacks #3 Rank (Hold).
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