United Airlines buys two Spirit gates at O'Hare for $30M in battle with rivalry American

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United Airlines agreed to buy two gates from bankrupt Spirit Airlines at Chicago's O'Hare International Airport, according to the Chicago Business Journal. The deal covers gates G12 and G14 for about $30 million. A bankruptcy hearing on the sale is set for later this month.

"We expect to begin operating from these gates late in the second quarter," said Omar Idris, vice president of United's O'Hare hub, in an internal memo, as reported by Chicago Business Journal.

Escalating battle for Chicago dominance

This purchase follows American Airlines' $30 million buy of Spirit's gates G8 and G10 two months ago. Both moves ramp up the fierce contest between the carriers at O'Hare. United, already the larger player there, aims to match any growth by American.

United CEO Scott Kirby has vowed to counter American's expansions, as reported byView from the Wing. "Whatever growth American engages in there, United will match," Kirby has reportedly said.

Spirit filed for bankruptcy in August. It has cut flights nationwide while using common-use gates to keep a reduced O'Hare schedule. One of United's new gates returns to the Chicago Department of Aviation by late September; the other stays longer, according to the Chicago Business Journal.

American plans over 500 daily O'Hare departures this spring, up 30% from last year, the Chicago Business Journal said. Its chief commercial officer, Nat Pieper, told staff that Chicago shines for loyalty programs. "Chicago is one of the best markets from a loyalty perspective and it's growing like crazy. 20% enrollments over the last 9 months," Pieper said, per View from the Wing.

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"We are not looking to gain gates at the expense of competitors," Idris wrote, as reported by the Chicago Business Journal. The gates support United's growth while holding its lead in Chicago.

Analysts see billions in loyalty revenue at stake. According to View from the Wing, Deutsche Bank's Mike Linenberg estimates American's O'Hare net margin near 9%. United's push pressures American amid slot and gate limits elsewhere.

Chicago remains vital as American seeks credit card gains after setbacks in New York and Los Angeles. United bets it can outlast the fight, driving competition that may lower fares in the short term.

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