Oil Rise Could Lead UAL to Ground Planes

[Smarta$$]

I cannot help but notice that the "recession" card is being thrown around by the press just as the news out of Iraq/Afghanistan is getting better, much better. The media can't scare folks into voting Democratic because of the war (heck the news is good and folks would actually realize that the present administration has been correct all along...therefore making the present Dem controlled Congress look even worse). So, now the media has locked on to RECESSION thinking that will cause the voters to elect a Democratic president. This too will backfire as folks realize that is recession is not right around the corner.
Bottom line, this economy survived 9/11 w/o a recission and will do just fine. Might I suggest that folks stop spouting off liberal talking points.

Wow, your head is in the sand.

 

[luckytohaveajob]

The storm is coming, get ready

.....the company has the option of grounding planes......
.....planning at the biggest carriers said that other airlines are also talking about idling aircraft......
.....bigger airlines like United, American Airlines, and Northwest Airlines historically have had flexibility with their aircraft.



http://biz.yahoo.com/rb/071109/airlines_fuel_us.html?.v=3

 

[luckytohaveajob]

Bottom line, this economy survived 9/11 w/o a recission and will do just fine. Might I suggest that folks stop spouting off liberal talking points.

I am as far left as one can get. Liberal Talking points. What are you talking about?

I really like your point about the economy surviving 911 with out a recession.

What did you call 2002, 2003, 2004, and the beginning of 2005? The stock market crumbled to half it value. The dollar deflated. The White House cut taxes to ease the recession, and the Fed cut interest rates down to an artificial 1%.

There is no easy fix for the current problems. The US govt. has already played all the cards.

 

[stillflyn]

Not going to happen

November 9, 2007​

Fear – Part Deux​

United’s “100 - 100 Plan”​

On Wednesday, November 7th at Goldman Sachs’ Investor Conference, United Airlines Executive Vice President and Chief Financial Officer Frederic “Jake” Brace postulated that United and its rivals have two major ways to deal with crude-oil prices approaching $100 per barrel:
“Either the industry passes on higher fuel prices or we're going to have to lower capacity. Jake went on to say that “We have a lot of flexibility in our fleet” intimating that United has more than 100 aircraft unencumbered that it could ground or sell if oil prices get too high.
Within hours, a retraction by Jake was released to employees from corporate communications noting that he wanted “…to put the story right and get the facts into the right context.” As the Bard would say, “methinks thou dost protest too loudly.”
Even in trying to calm the waters, Jake couldn’t help but let his true colors shine when he continued to babble on in his retraction email...“Because [our 100 aircraft] are unencumbered, if oil prices stay high and if we cannot pass the costs on to our customers, one way to manage our capacity could be to ground aircraft, which we could do without incurring ongoing costs. It was one point in a larger conversation about the possible responses we would have in an extreme environment…” It really does make us smile when Jake makes our job so easy.
This is exactly what we warned you about in our Special Transition Update entitled “FEAR.” Make no mistake, you have now seen the top three corporate officers, Tilton, McDonald and now Brace, in as many weeks, trot out variations of a theme meant to manipulate your emotions, specifically your fear.
We’re going to call this latest management faux-pas the “100-100 Plan” because Jake seems to equate $100 oil with the need to park 100 airplanes.
For a senior management team that speaks incessantly of non-core asset sales in order to return cash to shareholders; who trumpets their cost controls and industry leading margins; who generally tells the financial markets that the place is hitting on all cylinders, it seems strange that they are now crying poormouth because of $100 oil.
It should be a given that the revenue presently generated by these 100 aircraft is essential if the company is to remain in compliance with the financial requirements set forth in the exit loan covenants. So let’s dig deeper into Brace’s statement and speak to the facts — facts that will demonstrate to you that gutting the fleet of 100 aircraft is easier said, by an Executive Vice President no less, than done.
1. Contractual prohibition: As pointed out in the MEC Friday update, your MEC negotiating committee recently concluded an agreement with the company on minimum block hours that must be maintained at the mainline. It is referred to as Section 1-F-1. In short, gutting 100 aircraft from the fleet, and the resultant block hour reduction, would put the company in violation of that agreement which was ratified by your MEC at their September special meeting.
2. Furlough/Training issues: To park 100 airplanes would require a massive furlough of roughly 1,000 pilots. This would require a massive downbid of the airline causing untold training events. How would that fit into Jake’s statement that such an event could occur “…without incurring ongoing costs?”
3. Marketing/Revenue: Unless our competitors match our reductions, customers would abandon us and move to other airlines. Unless the industry colludes in a reduction plan, the increases in fares brought about as a result of capacity reductions would be difficult to attain. In addition, cutting flights associated with a 100 aircraft reduction would ripple throughout the entire revenue structure, causing even greater revenue loss than that lost from the 100 aircraft reduction.
4. Exit financing loan covenants: As part of the exit loan financing package, the company is required to comply with several loan mandates that include minimum interest coverage levels and cash flow requirements. Such a severe reduction to the revenue base presently generated by these 100 aircraft would most likely result in the company being in non-compliance with these covenants.
We could go on but why waste your time or ours. Bottom line, Jake failed to engage his brain before opening his mouth. The result was a laugh on our part but should be a lesson on yours. This is what you will continue to see in the coming months in what we can only surmise is a calculated, conscious effort by the senior management group of this company to “herd” you in a direction of their choosing.
Plain and simple…..don’t allow it. Do not allow these people to control your emotions. Do not allow them to loosen your resolve. Do not allow them to cause you to take your eye off the ball.

Leverage does not just show up, unannounced, on one’s doorstep. Unified pilots create leverage.​

 

[MJ42]

"What did you call 2002, 2003, 2004, and the beginning of 2005? The stock market crumbled to half it value. The dollar deflated."

I must be very smart then because I've made a lot of money off my stocks, mutual funds and 401k the last few years. (or you're just wrong).

 

[luckytohaveajob]

"What did you call 2002, 2003, 2004, and the beginning of 2005? The stock market crumbled to half it value. The dollar deflated."

I must be very smart then because I've made a lot of money off my stocks, mutual funds and 401k the last few years. (or you're just wrong).

Stay fully invested and see what happens. I bet you lose your a$$, Mr. I'm So Smart.

For those of you interested in the truth I suggest watching this:
http://video.google.com/videoplay?d...308&start=0&num=10&so=0&type=search&plindex=0

Soft money has a huge price. Mr. I'm So Smart is going to find it out the hard way.

And all of you shills who think Greenspan is such a genius, get a clue. He is just a legalized criminal.

 

[luckytohaveajob]

"If the American people ever allow private banks to control their currency, first by inflation and then deflation, the banks and corporations that will grow up around them will deprive the people of all their prosperity until their children will wake up homeless on the continent their fathers conquered." Thomas Jefferson

Greenspan is making you and your children homeless and you don't even understand what I am talking about.

Oil is controlled by a cartel called OPEC. And money is controlled by a cartel just like the mafia called the FEDERAL RESERVE.

 

[DH106]

OK, my two cents.

UNITED IS NOT GOING TO PARK ANY AIRPLANES.

Why would they do their competitors such a huge favor by reducing industry-wide capacity? They wouldn't. They're not going to park their own airplanes, just so that their competitors can fill up theirs.

I mean, seriously... if they're genuinely concerned about costs (which they're not), wouldn't you expect the top clowns at UAL to attempt another BK filing? I think the industry learned that UAL can file BK all they want, and nothing bad will happen to them. I'm speaking from the viewpoint of their top management.

This whole thing is nothing more than a union scare tactic.

 

[kommutrdog]

I cannot help but notice that the "recession" card is being thrown around by the press just as the news out of Iraq/Afghanistan is getting better, much better. The media can't scare folks into voting Democratic because of the war (heck the news is good and folks would actually realize that the present administration has been correct all along...therefore making the present Dem controlled Congress look even worse). So, now the media has locked on to RECESSION thinking that will cause the voters to elect a Democratic president. This too will backfire as folks realize that is recession is not right around the corner.
Bottom line, this economy survived 9/11 w/o a recission and will do just fine. Might I suggest that folks stop spouting off liberal talking points.

I apologize for the bold & large font, but sometimes I get so dumbfounded that I feel the need to start screaming from the rooftops.

There is no possible way that you are dumb enough to actually believe what you wrote here. No way. You fly a jetliner and were smart/persistent/driven enough to get hired by SWA.

Do you REALLY believe that it is the "liberal media" behind all that recession talk? Do you even remotely pay attention to the economic fundamentals shifting? Housing prices dropping, rapidly. $4.00 gas by Grinchmas time, $100 oil and the once-mighty US dollar sinking towards Peso status?

Homebuilder stocks and the Banks have been getting KILLED on Wallstreet. All the high-flyers in tech, RIMM, Google, Apple, Amazon...all cracked 7-10% in 2 days and now have broken charts.

You think that is just a reasonable pull-back? Countrywide Financial, the USA's largest mortgage issuer has gone from $60+ to $14 !

Rome is burning, you fool!

Come on. Turn off Fox & CNBS for just ONE WEEK and start digging on your own. Peel the onion...you won't like what you will find.

Homework assignment: Bill Fleckenstein & Peter Schiff. Use google & start reading. Your family will be better prepared. Mine is.

 

[kommutrdog]

"If the American people ever allow private banks to control their currency, first by inflation and then deflation, the banks and corporations that will grow up around them will deprive the people of all their prosperity until their children will wake up homeless on the continent their fathers conquered." Thomas Jefferson

Greenspan is making you and your children homeless and you don't even understand what I am talking about.

Oil is controlled by a cartel called OPEC. And money is controlled by a cartel just like the mafia called the FEDERAL RESERVE.

At least somebody else on this board gets it. I was getting lonley around here.

 

[MJ42]

Stay fully invested and see what happens. I bet you lose your a$$, Mr. I'm So Smart.

For those of you interested in the truth I suggest watching this:
http://video.google.com/videoplay?d...308&start=0&num=10&so=0&type=search&plindex=0

Soft money has a huge price. Mr. I'm So Smart is going to find it out the hard way.

And all of you shills who think Greenspan is such a genius, get a clue. He is just a legalized criminal.

I watched your video and it states the obvious.

So you think I'll find out the hard way, huh? As you know, you can't depend on any airline for retirement planning. I've done quite well for myself and will continue to invest SMARTLY! Your fully invested losing "my a$$" BS is only true if you are not diversified as well as greedy. You believe what you want, you can always find supporting info on the internet for any opinion you might have. That does not mean it's reality.

FWIW I agree with your OPINION on Greenspan. As for everything else, we disagree. I didn't attack you in my original post, I just did not agree with your opinion. Yet you chose to attack me...classless!

 

[AWACoff]

[

"Greenspan is making you and your children homeless and you don't even understand what I am talking about."




Who is this Greenspan person you are talking about?!

 

[climbhappy]

help me out here. first, the dems are in disarray. pelosi and her pals can't agree on a funding measure for the war. language too soft, too hard. that deal is falling apart. somebody said the Bush was right all along. hey, they have admitted to colossal blunders along the way. all their foreign policy has changed diametrically with n korea, iran. they have reversed course. he has been like a pilot asking for 180 degrees right for weather the last four years.

a falling dollar will lower the trade deficit and our gov't securities will be unattractive? if nobody finainces our debt, we'll be debtor nation.?
we have sold so many assets here to foreigners it is pathatic.

now, as long as corp profits are strong, the market will be fine? right? if interest rates go up, the market will tank and bonds become popular? with the market tanked, all the wealth created by the market will make folks think they're not as rich and they quit spending, the economy tanks, we get laid off?

do i have this half right?

 

[freightdogfred]

"If the American people ever allow private banks to control their currency, first by inflation and then deflation, the banks and corporations that will grow up around them will deprive the people of all their prosperity until their children will wake up homeless on the continent their fathers conquered." Thomas Jefferson

Greenspan is making you and your children homeless and you don't even understand what I am talking about.

Oil is controlled by a cartel called OPEC. And money is controlled by a cartel just like the mafia called the FEDERAL RESERVE.

Could you provide a link to where you got this quote?
I don't think the word or concept of "corporation" existed in 1776.

 

[luckytohaveajob]

Could you provide a link to where you got this quote?
I don't think the word or concept of "corporation" existed in 1776.

I got it out of a video I was watching called the Fiat Economy.