Flying into the Future: How FAA Reforms Could Lift United Airlines’ Stock
9min read The aviation industry is bracing for a major overhaul, and United Airlines CEO Scott Kirby is at the center of the storm. In a high-stakes interview on Face the Nation (May 11, 2025), Kirby revealed unprecedented optimism about fixing the Federal Aviation Administration (FAA)—a move that could reshape the airline’s financial trajectory.
The Catalyst: Newark’s Chaos and Kirby’s Bold Vision
Kirby’s remarks followed two recent air traffic control outages at Newark Liberty International Airport, which caused ground stops, flight cancellations, and a 90-second radar failure. These disruptions highlighted systemic flaws in the FAA’s aging infrastructure. Yet Kirby framed the crisis as a catalyst for change, stating, “This is the most optimistic I’ve been in my entire career about finally getting the FAA fixed.”
The CEO emphasized bipartisan support for overhauling the agency, including a Trump administration plan to modernize air traffic control systems with “billions—lots of billions” in funding. Kirby praised Transportation Secretary Sean Duffy for his “action-oriented” leadership and noted reforms would address staffing shortages (30% below required levels) and outdated technology.
The Investment Case: Risks and Rewards
1. Immediate Operational Challenges
United has already cut 35 daily roundtrips at Newark to align with FAA capacity limits, a move Kirby called “necessary” to prioritize safety. While this reduces revenue in the short term, it reflects the airline’s proactive approach to minimizing passenger disruptions. Kirby also noted deploying larger aircraft to maintain seat availability, mitigating concerns about rising ticket prices.
2. Long-Term Systemic Fixes
The FAA’s modernization plans could reduce delays and operational costs over time. Kirby highlighted “backups to backups to backups”—advanced safety protocols like onboard radar systems and alternative communication frequencies—that ensure safety even during outages. These measures, coupled with infrastructure upgrades, could stabilize United’s operations and improve investor confidence.
The Political and Financial Landscape
The reforms’ success hinges on funding. Kirby stressed the need for “upfront funding” to avoid past stop-start cycles, estimating total costs in the tens of billions. While Congress has shown rare bipartisan support, delays could strain airlines further.
Key Data Points:
- Newark’s runway repairs alone will take until June 2025, with capacity halved until then.
- The FAA’s controller training program produces only 1,800 candidates annually, yet net gains are just 300/year due to attrition.
Conclusion: A Risky Gamble with High Reward
United’s stock (UAL) has fluctuated amid the FAA saga, but Kirby’s optimism reflects a pivotal moment. If reforms pass, the airline stands to gain operational stability, cost efficiencies, and a competitive edge. However, risks remain: delayed funding, regulatory hurdles, and lingering passenger safety concerns could weigh on earnings.
Investors should monitor UAL’s stock performance and the FAA’s progress closely. With bipartisan momentum and Kirby’s aggressive advocacy, the skies might finally clear for United—and the broader aviation sector.
Final thought: The FAA’s fate isn’t just about air traffic control—it’s a test of whether U.S. infrastructure can adapt to 21st-century demands. For United, the answer could mean soaring—or stalling.
