United to delay Boeing jets in $4.8 billion savings push

United Continental Holdings will defer delivery of 61 of Boeing’s smallest passenger jets as the airline seeks to close its profit gap with Delta Air Lines and American Airlines.

United plans to convert the order to the larger, newer Boeing 737 Max to be delivered at an undetermined date, slowing near-term capacity growth as recent hires President Scott Kirby and Chief Financial Officer Andrew Levy start to reshape the fleet strategy.

The shift will trim spending by $1.6 billion over the next two years, according to a statement Tuesday by the Chicago-based carrier.

The fleet changes are part of $4.8 billion in initiatives intended to bolster the airline’s profitability through 2020. Chief Executive Officer Oscar Munoz is looking for ways to elevate profit margins and match Delta, which has led the industry in recent years.

United’s operating profit amounted to 13.6 percent of sales last year, trailing Delta’s 19 percent margin and American’s 15.1 percent.

United climbed 2.8 percent to $64.71 at 11:51 a.m. in New York, a day after Warren Buffett’s Berkshire Hathaway Inc. said it had invested in the airline and three major rivals. Berkshire is an “anchor tenant” investor, Munoz said in a meeting with analysts. United’s gain was the second biggest on the Bloomberg U.S. Airlines Index, which rose 1.6 percent.