2013 L-CAL System Bid Out

[eaglesview]

I know, I know. You are right, and I would do good to adapt that same perspective. I'm just reading this bid and I realize this is it for CAL pilots. I know L-UAL guys are looking forward to bidding these positions with whatever new seniority they get in SLI. My fellow CAL pilots are looking forward to....? What? What did United bring to the party? You'd take ORD over IAH?! Really? Out of IAH I go all over South America and the Caribbean , and it's a blast. I did ORD trips last week and I overnighted in BUF and BDL. It sucked... GUM does the island hopper. I've heard that base is the best flying you'll ever do. Is NRT even a base? SFO and EWR might be a close comparison... Idk. The good stuff UAL did bring isn't going to have much for openings. There's all sorts of new stuff in this merger, IF you are L-UAL. There is no future meaningful career expectation that a CAL pilot would not have had, or had sooner, absent this merger. Not that I can see. Can you show me where I'm wrong?

Dude each side has sacrificed for this merger. ALL of our 737 were parked to get this done. As for the bases I was reffering to $$$$ to be made for the company. I'm so sorry you suffered through a BUF layover. From now on every bid will be for all of us. There will be bids opening up on "both sides." (I'm not sure why you still "speak" in these terms) Do you think there are no retirements going on on L-UAL side. Do you think the required manpower as a result of the JCBA only affects "your" side. The sooner you stop moping and complaining the better off you will be. IMHO: or maybe you enjoy complaining in which case, carry on.

 

[calfo]

ALL of our 737 were parked to get this done

Delusional.

 

[taxicabdriver]

Lol.... Omg... The first time I heard that I started laughing, until I realized the person actually believed this

 

[eaglesview]

Delusional.

OK you tell me why they were parked.

 

[Flopgut]

Bids like this current one, were part of our recent past and our immediate future. You tell me what you think the next bid is going to look like?

I'd really like an answer to this from a sUAL pilot. You all love to compare your DOH to our bids, BESs and staffing numbers. I listen as you do your Jepps and marvel at all the new destinations (while I'm adding plates to rustbelt sh!tholes). So what's the next bid going to look like guys? Spread some cheer, if you can. Are there any pleasant surprises in the L-UAL system?

Dude each side has sacrificed for this merger. ALL of our 737 were parked to get this done. As for the bases I was reffering to $$$$ to be made for the company. I'm so sorry you suffered through a BUF layover.

Yeah, I know I'm being a bit dramatic about having to go to BUF. I realize that is a stupid complaint.

OK you tell me why they were parked.

They got parked for some/any deal. "This" turned out to be the deal that happened, but you were being groomed for ANY eventual merger. You can't project the negative effects onto anybody but yourselves. In fact, you're damn lucky it was us and you ended up wrecking our scope clause. How about by way of apology, you try a little harder to contain your enthusiasm when you look at our bids? Or, explain to us what we can look forward to taking a crack at?

 

[taxicabdriver]

Or maybe they were parked when they sold out scope and let the 70 seat rjs do the flying??

 

[Skychief]

OK you tell me why they were parked.

Because they were dinasaurs... plus the company could replace their flying with 70 seat airplanes at fraction of the cost....

if you want to argue the LUAL 737's were parked for the merger, then I argue LCAL parked all of their classic 737's for the merger as well...

so either way the point is moot.

 

[densoo]

'United to Park Dozens of Jets"

June 04, 2008|By Julie Johnsson, TRIBUNE REPORTER

United Airlines is expected to ground dozens of its least-fuel-efficient aircraft, including Boeing 747 jumbo jets, as part of a sweeping round of cuts intended to help the carrier conserve cash and survive as a stand-alone company in daunting times.

The Chicago-based airline intensified planning for the initiative as it cooled on a potential merger with US Airways in mid-May, say people familiar with its plans. United is expected to announce the cuts as early as Wednesday.

With the economy in a downdraft, capital constraints have made large-scale mergers largely unfeasible, forcing carriers like United to seek other ways to cut capacity in an effort to gain sufficient pricing power to cover rising fuel costs.

United plans to retire the workhorses of its domestic fleet: 94 decades-old Boeing 737 jets, single-aisle planes that seat up to 123 passengers and cover medium-range distances, say people close to the company.

Doing so would eliminate more than 20 percent of the 460 aircraft in United's fleet, likely leading to job reductions, sources said. The airline is in talks with its unions about ways to soften the blow, including offering workers special leaves of absence.

United already had planned to ground all of its 30 Boeing 737-500s, which seat just 108 passengers but burn as much fuel as the larger, narrow-body jets that it uses for flights within North America.

But the nation's second-largest carrier also will phase out the 64 Boeing 737-300s that it operates, the oldest jets in its fleet, which have an average age approaching 20 years, sources said.

"Aging goes hand in hand with fuel inefficiency," said aviation consultant Robert Mann, president of R.W. Mann & Co. "At these fuel prices, more and more of the domestic network is uneconomic."

While the price of crude oil has fallen 8 percent, to $124, from peak May prices, fuel costs still pose a threat to the airline industry's viability, analysts said. Also worrying is a drop in passenger demand that will make it difficult for carriers to raise prices without additional capacity cuts.

United Airlines said Tuesday that May traffic declined by 4.1 percent, while its load factor, or percentage of seats filled, weakened to 82.6 percent from 84.6 percent a year ago.

"Airlines have only the cash on hand and the time still on the clock to fix these problems," Mann said. "It's definitely self-help time. If they're not going to do it through consolidation or collective capacity cuts, they have to do it themselves."

 

[Chairman]

Announced 2 months after......................

Continental Abandons Merger Talks With United
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By ANDREW ROSS SORKIN and MICHELINE MAYNARD
Published: April 28, 2008
Correction Appended

Continental Airlines said Sunday that it had abandoned merger talks with United Airlines and was planning to remain an independent carrier, a blow to lengthy efforts by United to find a merger partner.

Related
Eos Airlines to Stop Flying by Monday (April 27, 2008)

Times Topics: Continental | UAL | Air Travel

Continental’s decision, announced by the airline Sunday afternoon, will change the complex game of musical chairs that the airline industry is playing after the merger announcement last week by Delta Air Lines and Northwest Airlines.

Continental’s move was a stunning development for United’s parent, UAL, which had been negotiating in expectation of reaching a deal by late this week. As recently as Friday, it looked as though Continental, based in Houston, and United, based outside Chicago, were on the way to reaching a merger agreement.

Continental decided to drop the discussions after UAL announced worse-than-expected earnings, which sent shares falling last week. On Tuesday, United said it lost $537 million during the first quarter, on sharply higher costs for jet fuel. The airline, which spent more than three years under bankruptcy protection earlier this decade, said it would cut flights and eliminate a further 1,000 jobs.

Directors at Continental, who met Sunday afternoon, feared that a merger with United could put their company in peril. Continental, which had been expected to take management responsibilities in a deal with United, survived two bankruptcy filings of its own in the 1980s and 1990s, and has been considered one of the industry’s best-run carriers.

With the United-Continental deal scrapped, a new set of pairings is likely to take place. UAL is expected to push to reach a deal with US Airways, with which it had also been discussing a merger, people involved in the talks said.

In a statement, United's chief executive, Glenn F. Tilton, said on Sunday night: "Consolidation is under way. Ensuring you have the right partner is everything. We will pursue all options to ensure a strong, sustainable future for our airline and will not shy away from the tough choices necessary to create value for our shareholders and benefit our employees and customers."

Meanwhile, Continental is expected to press ahead with preliminary talks to create a three-way alliance — short of a full merger — with American Airlines and British Airways.

In a letter to Continental employees, Lawrence W. Kellner, the airline’s chief executive, and Jeffery A. Smisek, its president, wrote: “The board very carefully considered all the risks and benefits of a merger with another airline, and determined that the risks of a merger at this time outweigh the potential rewards, as compared to Continental’s prospects on a stand-alone basis.”

They said they worried a deal would put company’s operational and financial strengths “at risk.” They also hinted at forming a new alliance, saying, “We are considering alternatives to SkyTeam” — an alliance with Delta and Northwest — “as we carefully evaluate which major global alliance will be best for Continental over the long term.”

The executives did not mention American or British Airways.

The two sides had agreed on several issues in their talks. Mr. Kellner would have run the combined company, while United’s chief executive, Mr. Tilton, would have stepped away from day-to-day operations.

Mr. Tilton had advocated strongly for industry consolidation, saying it was the only solution to help the struggling airlines become consistently profitable. US Airways’ chief executive, W. Douglas Parker, has also pushed for consolidation, making an unsuccessful hostile bid last year for Delta before it emerged from bankruptcy protection.

Mr. Kellner, in his letter, at least seemed sympathetic to the industry’s plight, telling employees, “Every U.S. carrier, including Continental, is under enormous pressure from record high fuel prices, a slowing U.S. economy and a weak dollar.”

United’s stock closed at $21.43 last Monday. That evening, Delta and Northwest announced their merger plans. On Tuesday, United’s shares closed below $14. They ended the week at $15.21, off 29 percent for the week. United shares were down about 8 percent on Monday while Continental shares were down 4 percent.

On Tuesday, United’s chief financial officer, Frederic F. Brace, said repeatedly that the airline was in compliance with the covenants of its bank agreements. But, Mr. Brace added, “With the recent spike in fuel prices and the softening economy the trajectory of our covenant coverage is downward.”

Because of steps the airline was taking to cut costs, he said, “it’s really very difficult to predict whether we will have an issue or not.”

On Wednesday, after the sharp drop in its stock, United issued a statement saying that it was in compliance with the terms of deals governing its credit arrangements with banks, including JPMorgan Chase, Citibank and Credit Suisse.

Analysts said the situation created doubt about United’s health, an issue that has hovered around United since it emerged from bankruptcy protection in early 2006. That concern was a reason talks between Delta and United, which took place while Delta was under bankruptcy protection earlier this decade, never gained traction.

Meanwhile, Continental’s next steps are far from clear. Although it planned to pursue discussions with American about joining its alliance with British Airways, the corporate cultures of Continental and American differ significantly. American, as the nation’s biggest airline until the Delta-Northwest deal is completed, is likely to want to dictate the terms under which the much-smaller Continental comes on board.

At the same time, Continental’s membership in the SkyTeam alliance could offer much greater reach than a deal with American and British Airways. The new Delta will be bigger than American, and other members in SkyTeam include KLM and Air France, which have a broader base than American and British Airways across Europe and the rest of the world.

Meanwhile, in a further sign of the industry's problems, Eos Airlines, a business-class carrier, said Sunday that it had filed bankrupcy protection and ceased flying. Eos said it filed for Chapter 11 protection in New York on Saturday. Eos offered business class flights between New York's JFK Airport and Stanstead Airport in London. It was the latest in a series of small airlines to file for bankruptcy protection in the last few weeks.

Eos made its final flights from London to New York on Sunday, and canceled flights in the opposite direction. It began flying in 2005.

This article has been revised to reflect the following correction:

Correction: April 29, 2008
An article on Monday about Continental Airlines’ decision to end merger discussions with United Airlines misstated the first-quarter loss of UAL Corporation, United’s parent, in some editions. It was $537 million, not $357 million.

 

[Chairman]

Followed by 6 months later......

Continental to leave SkyTeam alliance in October
BILL HENSEL JR., Copyright 2009 Houston Chronicle | January 29, 2009
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Continental Airlines plans to exit the SkyTeam alliance with Delta Air Lines, Air France and others after its last flight Oct. 24 and join the rival Star Alliance shortly thereafter, CEO Larry Kellner said today.

Kellner said the transition to Star, the world’s biggest alliance led by United Airlines and Lufthansa, will be a major focus for the carrier this year. The October date jibes with Houston-based Continental’s previously announced plan to begin new service to Frankfurt, Lufthansa’s global hub, on Nov. 1.

Continental also is slated to begin a separate ticketing and cost-sharing partnership with United during the fourth quarter. The two carriers announced that deal, which still requires regulatory approval, shortly after the merger between Delta and Northwest Airlines was announced last year.

Kellner's statements came on a conference call after Continental reported that it lost $266 million in the fourth quarter as the recession bit into traffic.

Continental lost $2.33 per share, compared with a loss of $32 million, or 33 cents per share, a year ago.

Excluding net charges of $170 million, Continental’s loss would have been $96 million, or 84 cents per share. Analysts surveyed by Thomson Reuters expected a loss of 89 cents per share.

Revenue slipped 1.5 percent to $3.47 billion, slightly below analysts’ forecast of $3.49 billion.

Fuel and labor — Continental’s two biggest expenses — rose 4 percent and 5.1 percent, respectively.

Continental said in a regulatory filing today that international bookings over the next six weeks are lagging behind last year’s pace. As a percentage of available seats, trans-Atlantic bookings are running 6 to 7 percentage points behind last year, and Pacific and Latin American flights are also filling less quickly.

Kellner said the airline industry is prepared for the current economic downturn because of the large capacity cuts made last fall in response to high fuel prices. Those cuts included a more than 10 percent capacity reduction at Bush Intercontinental Airport, according to the filing, although the remaining flights were fuller than the previous year.

Those moves came with job cuts, but Continental has no additional layoffs planned, Kellner said. However, he cautioned the airline will do whatever it takes to return to profitability and be a viable long-term survivor.

The fact that fuel prices have fallen from historic summertime highs has helped Continental and the industry in the wake of the softened travel demand, Kellner said. Continental expects to pay about $2 billion less for fuel this year than it did in 2008.

Revenue slipped 1.5 percent to $3.47 billion, slightly below analysts’ forecast of $3.49 billion.

Continental disclosed last week that it took a $125 million charge against fourth-quarter earnings to cover losses on a fuel-hedging contract with a Lehman Brothers unit that later filed for bankruptcy.

Still, Standard & Poor’s analyst Philip Baggaley said hedging losses were less at Continental than at some rivals. He added that Continental’s ability to preserve unrestricted cash during the fourth quarter “with less financing activity than some peers was also encouraging.”

Continental raised $200 million by selling stock in the fourth quarter and ended 2008 with $2.64 billion in unrestricted cash and short-term investments. It expects to end March with about $2.6 billion.

Ray Neidl, an analyst with Calyon Securities, said Continental posted good increases in revenue and yield with no real surprises elsewhere in its report. He praised the company for containing non-fuel costs at the same time it cut capacity.

Continental expects to take delivery of 13 new Boeing 737 aircraft this year — it dropped 12 older versions of the same plane from its fleet in the fourth quarter. The company expects to get 11 more 737s, two Boeing 777 jets and lease four 757 models from Boeing in 2010.

For all of 2008, Continental lost $585 million compared with a profit of $459 million in 2007. Revenue rose just over $1 billion, or 7.1 percent, to $15.24 billion, but that was swamped by a $1.9 billion increase in spending on fuel.