UAL getting 43 New 777's

[Twotter Driver]

A buddy called me today saying yahoo finance had an article stating that UAL had put an order in for 43 new 777's to replace older aircraft in UAL's widebody fleet. A split of 200's and 300's with the first to be delivered in late 2010. Then the article was removed from yahoo finance. Interesting none the less. It also stated UAL had options for up to 10 freighters. Maybe a premature news leak?? Any UAL folks hear similar info?

 

[AWACoff]

UALALPA,

This is Glen Tilton. I have announced an order for 43 777s which will dramatically better your career. We have procured financing contingent on our pilot contract. I know you have taken draconian pay cuts and had your quality of life degraded to that of a sewage plant blockage technician but in order to take delivery of these 43 aircraft, we cannot afford to give you any increases in your current contract. Concessions have not been discussed at this time but are of course a possibility.

Love,

Glen

 

[Volasl]

Hoax. Mod you should remove thread

 

[General Lee]

Bait and switch for CAL. United and Tilton would love to have the merger (so he can cash out), so maybe he let it out so CAL would be more interested?? Probably is a hoax.


Bye Bye---General Lee

 

[EMBpilot]

Haven't heard anything.

What would they be replacing?

 

[Metro752]

777 they merge with continental
A350XWB they merge with US Airways

http://www.chicagotribune.com/business/chi-united-planeorder-nov19-,0,867224.story


chicagotribune.com

United close to first new plane order in more than a decade

By Julie Johnsson
Tribune reporter
7:17 PM CST, November 19, 2009

United Airlines is close to placing its first aircraft order in more than a decade and has narrowed its search to two ground-breaking airplanes: Boeing's 787 Dreamliner or Airbus's counterpart, the A350-XWB, sources told the Tribune.

United is being furiously courted by both Chicago-based Boeing Co. and France-based Airbus SAS, sources said, even though the carrier's finances appeared shaky just months ago.

 

[Yuppyguppy]

I say an order first a merger eventually second...proly early mid 2010. UAL-CAL have to compete head on with the likes of DAL. Somebody has to shut up General Lee.

 

[sstearns2]

My WAG is that a big 777 order by UAL would result in the the rest of the 747 fleet being parked.

Scott

 

[ualdriver]

1) I think that thread on our internal forum was a hoax, which led to the start of this thread.

2) I don't think our management is stupid enough to believe that we're going to exchange pay for an aircraft order. Well, maybe they're stupid enough but we aren't.

3) I, for one, am not particularly excited about the anticipated order. If they're not growth aircraft and just replacement aircraft, well, I guess it's nice to have shiny new jets but it won't do much for our career prospects or those of the guys we have on the street and want to come back. We'll still have the worse management team in the business.

4) I'd second the opinion that if there is a 777-XXX order, the 747's will be gone at some point.

 

[General Lee]

I say an order first a merger eventually second...proly early mid 2010. UAL-CAL have to compete head on with the likes of DAL. Somebody has to shut up General Lee.

NEVER! WE WILL CRUSH YOU! Whatever dude, I can't wait to see that seniority list merge.


Bye Bye---General Lee

 

[ACL65PILOT]

Look at your media page and post the other financing that you did yesterday. That is more interesting.

 

[wmuflyguy]

Analyst Blog
UAL Corp. Raises Funds


By: Zacks Equity Research
November 18, 2009 | Comments: 0
Recommended this article (1)
UAUA | AMR | DAL | LCC | JPM | GS | MS

Print Share


UAL Corporation (UAUA - Analyst Report), the parent company of United Airlines, has announced the issue of $810 million notes to pay off existing debt. The $810 million in pass-through securities raised consists of $697 million of Class A certificates with a coupon interest rate of 9.75% expiring in Jan. 2017 and $113 million of Class B certificates with an interest rate of 12.0% expiring in Jan. 2016. A pass-through security is a fixed-income certificate against certain mortgage-backed securities, generally aircraft.

Of the total proceeds raised from the offering, $493 million will be used to pay off equipment trust certificates issued from 2000 to 2002, while the remaining of the funds will be used for general corporate purposes. J.P. Morgan (JPM - Analyst Report), Morgan Stanley & Co. (MS - Snapshot Report), Goldman Sachs & Co. (GS - Analyst Report) are acting as joint book-running managers for the issue.

In addition to the drop-off in travel because of the recession, United and other airlines have been struggling as profitable business travelers either stay home or fly cheaper elsewhere. United Airlines reported a 1.6% fall in October 2009 traffic. Capacity was reduced 4.3% to 11.64 billion available seat miles. With jet fuel prices on the rise, the company’s cash flow is expected to remain under pressure.

Other carriers that have raise funds include AMR Corporation (AMR - Snapshot Report), Delta Air Lines Incorporated (DAL - Snapshot Report) and US Airways Group Incorporated (LCC - Snapshot Report). According to the IATA a total of $8 million has been raised in new cash in the past two months by the world’s leading airlines.

http://www.zacks.com/stock/news/27428/UAL+Corp.+Raises+Funds

Filler

 

[ACL65PILOT]

That is the one!

 

[EMBpilot]

Isn't Doug in heat to merge again? It might be UAL+USair.

And CAL will merge with Copa, that way they can outsoure half of their flying to $3K/month crews.

 

[whymeworry?]

NEVER! WE WILL CRUSH YOU! Whatever dude, I can't wait to see that seniority list merge.


Bye Bye---General Lee

First you gotta' make money. DAL's losses are simply not sustainable. DAL/ NW has proven to be a merger dudd on all accounts thus far. Of course, it's still early in the merge, but history is riddled with big airlines that got too big only to fail in the end (Pan Am, TWA) . Not saying that will happen to Delta but with $44 billion in liabilities and $13 billion in net losses they have a long way to go before they'll "crush" anyone. As far as UAL/ CAL needing to merge in order to compete with DAL, we'll see. If mgmt can create enough synergies within the Star Alliance, as they seem poised to be doing right now, and if DAL continues to lose money, the playing field will somewhat be leveled.

That's not to say there won't be a merger. Any merger than may occur will only occur because mgmt wants a huge payday (ala DAL/NW reasons), not because it is necessary to take on DAL (though that will indeed be the line mgmt tows in order to pass muster). All other stakeholders will lose, just as they have with DAL till date.

 

[Anonymous2]

Here comes the 748 intercontinental!

 

[EMBpilot]

First you gotta' make money. DAL's losses are simply not sustainable.

Look at the route map and think who flies politicians in their Delta Elite fleet. The losses can be sustainable for a long-long time

DAL/ NW has proven to be a merger dudd on all accounts thus far. Of course, it's still early in the merge, but history is riddled with big airlines that got too big only to fail in the end (Pan Am, TWA) . Not saying that will happen to Delta but with $44 billion in liabilities and $13 billion in net losses they have a long way to go before they'll "crush" anyone.

Delta is 17 billion in debt. I think they have 4 in cash.


As far as UAL/ CAL needing to merge in order to compete with DAL, we'll see. If mgmt can create enough synergies within the Star Alliance, as they seem poised to be doing right now, and if DAL continues to lose money, the playing field will somewhat be leveled.

UAL/CAL create a lot of overlap and massive furlowghs, both have pilots on the streets already. Not to say anything about the employee moral and sharing cockpits with so many scabs and minorities.

That's not to say there won't be a merger. Any merger than may occur will only occur because mgmt wants a huge payday (ala DAL/NW reasons),

I wouldn't say 13 mil is such a huge payday in RA's case. Think of CAL selling airplanes with one hand and leasing them with another. A LOT more and a lot quieter.

not because it is necessary to take on DAL (though that will indeed be the line mgmt tows in order to pass muster). All other stakeholders will lose, just as they have with DAL till date.

Actually, I made money with DAL stock.

Regards

 

[Fly2AK]

EMBpilot

As far as UAL/ CAL needing to merge in order to compete with DAL, we'll see. If mgmt can create enough synergies within the Star Alliance, as they seem poised to be doing right now, and if DAL continues to lose money, the playing field will somewhat be leveled.

UAL/CAL create a lot of overlap and massive furlowghs, both have pilots on the streets already. Not to say anything about the employee moral and sharing cockpits with so many scabs and minorities.

Maybe I misunderstood this comment that I underlined, but it makes you seem like a racist, correct me if I am wrong.

 

[SpauldingSmails]

United is being furiously courted by both Chicago-based Boeing Co. and France-based Airbus SAS, sources said, even though the carrier's finances appeared shaky just months ago.

Good credit? Bad Credit? No Credit?

It doesn't matter! Guaranteed financing with proof of an operating certificate!

We've got an airframe for you! Nobody walks, Everybody flys!

 

[get2flyin]

Isn't Doug in heat to merge again? It might be UAL+USair.

And CAL will merge with Copa, that way they can outsoure half of their flying to $3K/month crews.

USAir is toxic....again. I can't imagine they will be merging with anyone.

 

[PHXFLYR]

Please...no more mergers . I've already been thru one too many...pick someone else.


PHXFLYR

 

[whymeworry?]

EMBpilot,

Look at the route map and think who flies politicians in their Delta Elite fleet. The losses can be sustainable for a long-long time

Seriously? You regard DALs sustainability because of it's correlation to the politicians they fly? Sounds like all the AQ pilots who said their 61 yr airline could never go out of business because: "Hawaii politicians would never allow it." Or the Air India pilots who claim their government will never let the state-run airline fail. As of today, AI is on the verge of going under, 98% of their routes lose money (Forbes Nov 2009) and they haven't paid their pilots in 4 months (a strike is scheduled for next week).

BTW, CAL flys political big-wigs too. So does everyone. Why do you think SWA gets so much support in Washington?

In business, you either have a sustainable model or you don't. No company is too big, or too connected, to fail. But I suppose you know all this already (que the GM/ GS/ AIG bailout history to make your point, I get it. Those were the exception. Beside the US gov't is broke).

As far as your making money on DAL. So did I... when the stock went from $7 to $8. Whoopy. Big deal. The fact is, the stock traded lower from the day the merger was announced and has never meaningfully recovered. Even today it is lower. Shareholders have been clobbered. But I doubt many noticed since so many lost money last year. For the time being the pilots are content because no significant cross-bidding has occurred and no furloughs have been announced as yet.

Regarding DAL's liabilities, I rechecked my numbers... to clarify, DAL lost $14.5 billion from 2000-2008. I should have been more clear about that. But it was an amount far higher than any other airline. And yes, they are $44 billion in debt.

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.

Of course, these are just my opinions. But I have done the research based on current info.

Back to the point. Until DAL makes money, I don't think a merger is a forgone conclusion. Thus far the only thing a mega-carrier has amounted to is one heaping loss and debt-load. But I will agree it is early in the game as yet and they may actually pull this off. Their timing sucked and all those DC-9s aren't helping (despite what GH says).

It does beg the question though, why are Anderson and his team unloading all their shares right now if DALs future is so bright? I'm no rocket scientist but I'm pretty sure mgmt's lack of faith in the stock is not a good sign.

As humans, we all tend to see life through rose-colored shades. DAL pilots really exaggerate this point. I recall in 2003 when my good DAL buddy, who was furloughed at the time, made some rather foolish moves with his career at the company he was flying for. When I warned him to be careful he told me he wasn't worried 'cause he'd be going back to DAL soon (that didn't happen until 4 yrs later in 2007). I went on to warn him that I thought DAL was in a precarious position because they had more than $2.5 in liabilities coming due in 2004 and that he should be prepared to hunker down. You'd have thought I just stole his wife based on his response. Folks, this is all public information. I hardly think I am being biased about it when I'm merely sifting through financial data (not a hobby, it's just so easily available if you know how to read a financial report). So dont' shoot the messenger. Get educated and enlighten yourself.

Belive me, I am under no illustions that UAL is a sinking ship that may eventually bring CAL down. But there isn't much I can do about it except hope that my merger committee is prepared for the battle that may come; or that UAL will get its act together and become a great carrier once again. In the meantime, we wait.

 

[contrail67]

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.


What are some of the "major" differences that would cause 3000 more pilots? Not sure of how CAL does their staffing.

 

[G4G5]

Since UAL has emerged from BK, Tilton has managed to accumulate $8 BILLION in debt. Their will be no sale of the Pacific routes because they are in essence owned by Citi as collateral on the debt. Citi and all of the other banks understand that UAL needs cash flow to service the debt. How would selling or merging help the banks?

UAL has managed to put it into a position where it's debt is to large for a merger.

Cal mgt will never merge with UAL, code share yes, merge never. No creditor will accept anything less then 100% on the UAL debt because UAL is currently servicing the debt. That puts CAL or AMR in the position of having to pay $8 billion to the banks before they incur a single penny of merger costs. Delta(15+ billion in debt) may have been willing to take on huge debt but AMR (9 billion in debt) and CAL's mgt (5+ billion in debt) appears to be of the mind set that in this economy cash and not debt is king.


The banks will continue to lend UAL money for assets just like October's $800+ million dollar loan for aircraft (12% pay out to the banks) until UAL has nothing left. At that point they will keep them on life support by purchasing FF miles.

It's going to be a long slow death by paper cuts until they either turn it around or reorganize under another BK.

Tilton burning through an average of $2 billion a year (in debt) and growing.........

Not so sure that DAL taking on $15+ billion in debt in a recessionary economy is a good thing, only time will tell....

 

[Yuppyguppy]

wow....you are such an expert G4G5 holy ********************

 

[G4G5]

wow....you are such an expert G4G5 holy ********************

Thanks

 

[atpcliff]

Hi!

I read that UAL thinks the -777ER is old technology, and won't be buying any more (Emirates agrees).

cliff
NBO

 

[whymeworry?]

As far as a UAL/ CAL merger, most of us think think the SLI process will be a blood-bath. No doubt! But overlap and excess staffing? No way. Much less overlap than NW/DAL. And if we adopt UAL's staffing formulas (which we and they will obviously push for) , there will be a need for up to 3000 more pilots. CAL's workrules suck, we've been understaffed for years because of it. But if they adopt our rules, there will be a furlough of an additional 1200 pilots between the two carriers.


What are some of the "major" differences that would cause 3000 more pilots? Not sure of how CAL does their staffing.[/QUOTE]

You know, I'm not exactly sure. Some of the items might be that we DH our IROs out to Europe, UAL works them. UAL has some sort of rigs and perhaps better contractural staffing formulas. I got the info from one of our guys who sat down with the UAL NC last year when it looked like a merger was imminent (shortly before the CAL BOD rejected UAL's advances). He told me so long as we take their work rules and keep our pay rates we would all do pretty well in a merger. But now that I think about it, 3000 new pilots might be a high number considering both airlines have considerably reduced fleet size since I was told that number in Spring 2008 (CAL parking 67 737s, UAL parking 100 737s). But starting in 2010, CAL willl grow its fleet again. At the moment UAL doesn't have any fleet growth plans but I assume they will eventually replace at least half the airframes they parked. So factoring in "re-growth" to where we all were Spring '08 and their staffing formulas, we could see close to that 3000 number if a merger ever occurred... again, assuming we took their work rules.

 

[contrail67]

Well I am all for keeping United's work rules but I don't want CAL's current pay rates OR UAL's current pay rates. It would not surprise me at all if there is a "merger" contract already written....in some drawer somewhere.

 

[ATRCA]

3000 more pilots? What a joke! You can't be serious. No merger has EVER LEAD TO HIRING IN THE HISTORY OF THE WORLD! and this one won't either. There will be at least 1200 furloughes. CALALPA has already hinted about reductions at both companies should they merge.

Furloughs and workforce poison, that's what you're gonna get. I'll throw in a fist fight here and there for good measure too. This merger will be like all of it's predecessors, it will create wealthy executives who will all be on a 5 year exit plan, the employees will forever blame one another for their woes and the company will bleed cash and shrink. That's been the formula for decades in this industry. Anyone who thinks otherwise is foolish.