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[font=Times New Roman, Times, serif]No bailout for United
June 17, 2004 – A New York Times editorial today said United Airlines is not entitled to a $1.6 billion government handout and should be allowed to fail if the carrier cannot make the changes necessary to remain viable.
The article also said the Air Transportation Stabilization Board (ATSB) has provided the service it was created for after 9/11, but no longer should be offering taxpayer assistance nearly three years after the terror attacks in the Northeast.
“Some of United's major competitors have been more adept at reinventing themselves in this new environment, without seeking taxpayers' help. It would be unfair for them to have to compete now with a partly subsidized airline,” the editorial said. “As for the viability of the overall aviation system, there is no need for the government to be worried. United, the nation's second-largest airline, has 16 percent of the market and tremendous assets. If it cannot deploy those assets profitably, someone else will, just as United once took over some of Pan Am's old routes.”[/font]
June 17, 2004 – A New York Times editorial today said United Airlines is not entitled to a $1.6 billion government handout and should be allowed to fail if the carrier cannot make the changes necessary to remain viable.
The article also said the Air Transportation Stabilization Board (ATSB) has provided the service it was created for after 9/11, but no longer should be offering taxpayer assistance nearly three years after the terror attacks in the Northeast.
“Some of United's major competitors have been more adept at reinventing themselves in this new environment, without seeking taxpayers' help. It would be unfair for them to have to compete now with a partly subsidized airline,” the editorial said. “As for the viability of the overall aviation system, there is no need for the government to be worried. United, the nation's second-largest airline, has 16 percent of the market and tremendous assets. If it cannot deploy those assets profitably, someone else will, just as United once took over some of Pan Am's old routes.”[/font]
F9 Driver
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Kicking and screaming...
http://biz.yahoo.com/prnews/040617/nyth155_1.html
Press ReleaseSource: United Airlines
Statement From United Airlines
Thursday June 17, 8:21 pm ET
CHICAGO, June 17 /PRNewswire-FirstCall/-- We are perplexed by the announcement made by the Air Transportation Stabilization Board (ATSB) this afternoon.
We have reason to believe we are in the midst of a process with the ATSB to make our application acceptable and that a decision was premature. We do not believe that the Board was made fully aware of the important modifications United was willing to bring to the table. We are respectfully petitioning the ATSB for reconsideration of our pending loan application.
And from another board...
This is MEC Chairman Captain Mark Bathurst with a Special MEC Update for Thursday, June 17, 2004.
United Airlines and your union learned this evening that the Air Transportation Stabilization Board rejected our Company’s application for a loan guarantee. While this is certainly disappointing and would appear to be a setback in our efforts to exit Chapter 11 bankruptcy protection, it is certainly NOT the final word in our reorganization process. I want to assure you that all of our legal and financial advisors are confident that other sources of financing are available and, while this may delay somewhat our bankruptcy exit, our Company has a number of options. We stand ready and willing to continue our ongoing dialogue with management on the most effective course of action.
I can’t stress strongly enough that this is NOT the time for panic or any actions that diminish the professionalism that you exhibit each and every day. We have an incredibly talented group of legal and financial advisors who are working full time on this issue. Your MEC is fully informed and actively engaged and I urge you to keep in very close contact with your local representatives. Situations like this produce a largely inaccurate “rumor mill’ which creates unnecessary stress. Log on frequently to the MEC website. Check your e-mail frequently and attend your local council meetings. These are your first sources for timely and accurate information.
On Friday, I urge you to check the MEC website for a special video message from your union.
In speaking with CEO Glenn Tilton, I reminded him that each of you has worked tirelessly and has sacrificed greatly over the past 18 months to secure the company’s financial survival. The commitment and determination demonstrated by this pilot group and other employees since United’s bankruptcy filing in December 2002 has showcased the character that has made United Airlines one of America’s landmark companies. Mr. Tilton agreed heartily and pledged to continue his open and honest relationship with us.
Since United was denied a loan guarantee in December 2002, all of us have laid the groundwork and made possible a radical reorganization plan that has transformed United Airlines into an economically sound enterprise. We’re disappointed that the ATSB – a federal agency formed to help airlines hit hardest by the 9/11 terrorist attacks that led to the loss of two United planes, 18 employees and 89 passengers – failed to live up to the mandate under which it was established.
The ATSB’s decision, however, will only make your union more determined to work with the Company to emerge from bankruptcy. Our work will continue to focus on helping United Airlines regain a strong economic footing, and returning to the cockpit the 2,172 furloughed pilots who paid the ultimate price of United’s financial woes
http://biz.yahoo.com/prnews/040617/nyth155_1.html
Press ReleaseSource: United Airlines
Statement From United Airlines
Thursday June 17, 8:21 pm ET
CHICAGO, June 17 /PRNewswire-FirstCall/-- We are perplexed by the announcement made by the Air Transportation Stabilization Board (ATSB) this afternoon.
We have reason to believe we are in the midst of a process with the ATSB to make our application acceptable and that a decision was premature. We do not believe that the Board was made fully aware of the important modifications United was willing to bring to the table. We are respectfully petitioning the ATSB for reconsideration of our pending loan application.
And from another board...
This is MEC Chairman Captain Mark Bathurst with a Special MEC Update for Thursday, June 17, 2004.
United Airlines and your union learned this evening that the Air Transportation Stabilization Board rejected our Company’s application for a loan guarantee. While this is certainly disappointing and would appear to be a setback in our efforts to exit Chapter 11 bankruptcy protection, it is certainly NOT the final word in our reorganization process. I want to assure you that all of our legal and financial advisors are confident that other sources of financing are available and, while this may delay somewhat our bankruptcy exit, our Company has a number of options. We stand ready and willing to continue our ongoing dialogue with management on the most effective course of action.
I can’t stress strongly enough that this is NOT the time for panic or any actions that diminish the professionalism that you exhibit each and every day. We have an incredibly talented group of legal and financial advisors who are working full time on this issue. Your MEC is fully informed and actively engaged and I urge you to keep in very close contact with your local representatives. Situations like this produce a largely inaccurate “rumor mill’ which creates unnecessary stress. Log on frequently to the MEC website. Check your e-mail frequently and attend your local council meetings. These are your first sources for timely and accurate information.
On Friday, I urge you to check the MEC website for a special video message from your union.
In speaking with CEO Glenn Tilton, I reminded him that each of you has worked tirelessly and has sacrificed greatly over the past 18 months to secure the company’s financial survival. The commitment and determination demonstrated by this pilot group and other employees since United’s bankruptcy filing in December 2002 has showcased the character that has made United Airlines one of America’s landmark companies. Mr. Tilton agreed heartily and pledged to continue his open and honest relationship with us.
Since United was denied a loan guarantee in December 2002, all of us have laid the groundwork and made possible a radical reorganization plan that has transformed United Airlines into an economically sound enterprise. We’re disappointed that the ATSB – a federal agency formed to help airlines hit hardest by the 9/11 terrorist attacks that led to the loss of two United planes, 18 employees and 89 passengers – failed to live up to the mandate under which it was established.
The ATSB’s decision, however, will only make your union more determined to work with the Company to emerge from bankruptcy. Our work will continue to focus on helping United Airlines regain a strong economic footing, and returning to the cockpit the 2,172 furloughed pilots who paid the ultimate price of United’s financial woes
Publishers
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in general
In general they do not have a good deal of symapthy at the moment for getting the backing. Mostly this is a matter of time and the general thinking that they could have been more aggressive in bankruptcy actions.
Gordon B at Continental really did show everyone how to go after it and the other carriers have not really taken actions that demonstrate how serious their situation is. Carty and then Mullins just did not show the finance people they wanted to take serious actions. While he may not have been a really good guy, Wolf was always tough in these situations.
As to saying you cannot trust what these people say, you can become a self fulfilling prophet when they are optomistic that solutions will be found. If everyone questions that and puts forth no effort, they will fail. What kind of leader gives up on his team or believes they will fail. None.
In general they do not have a good deal of symapthy at the moment for getting the backing. Mostly this is a matter of time and the general thinking that they could have been more aggressive in bankruptcy actions.
Gordon B at Continental really did show everyone how to go after it and the other carriers have not really taken actions that demonstrate how serious their situation is. Carty and then Mullins just did not show the finance people they wanted to take serious actions. While he may not have been a really good guy, Wolf was always tough in these situations.
As to saying you cannot trust what these people say, you can become a self fulfilling prophet when they are optomistic that solutions will be found. If everyone questions that and puts forth no effort, they will fail. What kind of leader gives up on his team or believes they will fail. None.
InclusiveScope
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United:
[From BusinessWeek Online:]
>>>>"Perhaps most significant, United's managers haven't shaved pension expenses by even a dollar. Thanks to Congress, the airline is off the hook for replenishing its underfunded pension plans for two years. Still, United owes $4.1 billion to its pension funds over the next five years. That's huge. Indeed, if Southwest Airlines (LUV ) had United's pension expenses, one analyst calculates that the discount carrier would have had a $255 million loss last year instead of a $445 million profit."
"United can't simply dump these liabilities on the government's Pension Benefit Guaranty Corp. Only companies on the verge of liquidation can do that. But if United's managers are serious about saving the company, they should negotiate concessions with its unions. Of course, that risks poisoning management-labor relations, which, in turn, could undo United's recent successes in on-time performance and customer service. That explains why managers have kept this [pension] budget item off the negotiating table."
"Unions might be more understanding than managers think, however. Though they grumbled, every one went along with pay cuts in 2003, and on June 10, they all went further by approving $50 million-a-year reductions in retiree health-care benefits."
"It will need more than 35 years, for instance, to pay off its debts, based on current revenue, according to S&P's Philip Baggaley."
"Recognizing United's half-steps, the ATSB should tell United no, again. [DONE DEAL.] By doing so, the board [IS FORCING] United managers to take full advantage of Chapter 11 status and bring costs down to levels the airline could sustain. Then, and only then, might United truly become a carrier for the long haul."<<<<<<
[From BusinessWeek Online:]
>>>>"Perhaps most significant, United's managers haven't shaved pension expenses by even a dollar. Thanks to Congress, the airline is off the hook for replenishing its underfunded pension plans for two years. Still, United owes $4.1 billion to its pension funds over the next five years. That's huge. Indeed, if Southwest Airlines (LUV ) had United's pension expenses, one analyst calculates that the discount carrier would have had a $255 million loss last year instead of a $445 million profit."
"United can't simply dump these liabilities on the government's Pension Benefit Guaranty Corp. Only companies on the verge of liquidation can do that. But if United's managers are serious about saving the company, they should negotiate concessions with its unions. Of course, that risks poisoning management-labor relations, which, in turn, could undo United's recent successes in on-time performance and customer service. That explains why managers have kept this [pension] budget item off the negotiating table."
"Unions might be more understanding than managers think, however. Though they grumbled, every one went along with pay cuts in 2003, and on June 10, they all went further by approving $50 million-a-year reductions in retiree health-care benefits."
"It will need more than 35 years, for instance, to pay off its debts, based on current revenue, according to S&P's Philip Baggaley."
"Recognizing United's half-steps, the ATSB should tell United no, again. [DONE DEAL.] By doing so, the board [IS FORCING] United managers to take full advantage of Chapter 11 status and bring costs down to levels the airline could sustain. Then, and only then, might United truly become a carrier for the long haul."<<<<<<
[font=Times New Roman, Times, serif]Feds say no to United[/font]
[font=Times New Roman, Times, serif]June 18, 2004 -- In a 2 to 1 vote, a federal panel last night rejected United Airlines' application for a $1.6 billion bailout. Friday's edition of the USA Today says the loan was a key to the airline's plan to emerge from Chapter 11 bankruptcy.[/font]
[font=Times New Roman, Times, serif]An ATSB spokesman said, "The likelihood of United succeeding without a loan guarantee is sufficiently high so as to amke a loan guarantee unnecessary."[/font]
[font=Times New Roman, Times, serif]Late Thursday night though, House Speaker Dennis Hastert said he favors reconsideration of United's application. The Treasury Department also said it would be open to reconsideration if new information were brought forth in the next few days.[/font]
[font=Times New Roman, Times, serif]United's ALPA unit reacted angrily to the news. Spokesman Steve Dereby said, "This is an absolute slap in the face to all the employees of United."[/font]
[font=Times New Roman, Times, serif]ALPA cracks me up. This isnt a slap in the employees face its called doing whats right and letting the weak die is that is their destiny.[/font]
[font=Times New Roman, Times, serif]June 18, 2004 -- In a 2 to 1 vote, a federal panel last night rejected United Airlines' application for a $1.6 billion bailout. Friday's edition of the USA Today says the loan was a key to the airline's plan to emerge from Chapter 11 bankruptcy.[/font]
[font=Times New Roman, Times, serif]An ATSB spokesman said, "The likelihood of United succeeding without a loan guarantee is sufficiently high so as to amke a loan guarantee unnecessary."[/font]
[font=Times New Roman, Times, serif]Late Thursday night though, House Speaker Dennis Hastert said he favors reconsideration of United's application. The Treasury Department also said it would be open to reconsideration if new information were brought forth in the next few days.[/font]
[font=Times New Roman, Times, serif]United's ALPA unit reacted angrily to the news. Spokesman Steve Dereby said, "This is an absolute slap in the face to all the employees of United."[/font]
[font=Times New Roman, Times, serif]ALPA cracks me up. This isnt a slap in the employees face its called doing whats right and letting the weak die is that is their destiny.[/font]
General Lee
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The Federal Reserve Governor Ed Gramlich, a member of the ATSB, was quoted today as saying that he sees no reason to reconsider UAL's application.
The Fed has been the swing vote on ATSB decisions. It's also the ATSB member least susceptible to political pressure, because Federal Reserve Governors are appointed to long terms to insulate them from arm-twisting.
So the least politically-influenced member of the board is saying forget it.
It's also faintly insulting for United CFO Jake Brace to claim that somehow the board members didn't understand what United was trying to offer. These guys didn't just fall off the turnip truck. Let's talk about Brace for a second: this is the second time he's gotten a rejection by the ATSB. Just how competent is he?
The Fed has been the swing vote on ATSB decisions. It's also the ATSB member least susceptible to political pressure, because Federal Reserve Governors are appointed to long terms to insulate them from arm-twisting.
So the least politically-influenced member of the board is saying forget it.
It's also faintly insulting for United CFO Jake Brace to claim that somehow the board members didn't understand what United was trying to offer. These guys didn't just fall off the turnip truck. Let's talk about Brace for a second: this is the second time he's gotten a rejection by the ATSB. Just how competent is he?
DaveGriffin
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ALPA press release:
June 17, 2004
The Air Transportation Stabilization Board’s rejection of United Airlines’ loan guarantee application is a slap in the face to each United pilot and other employee who worked tirelessly and sacrificed greatly over the past 18 months to secure the company’s financial survival. The commitment and determination demonstrated by this pilot group and other employees since United’s bankruptcy filing in December 2002 has showcased the character that makes United Airlines one of America’s landmark companies. Since United was denied a loan guarantee in December 2002, this pilot group laid the groundwork and made possible a radical reorganization plan that has transformed United Airlines into an economically sound enterprise. We’re disappointed that the ATSB – a federal agency formed to help airlines hit hardest by the 9/11 terrorist attacks that led to the loss of two United planes, 18 employees and 89 passengers – failed to live up to the mandate under which it was established.
The ATSB’s decision, however, will only make this pilot group more determined to ensure United’s emergence from bankruptcy. We remain confident that United Airlines will continue to build on its already strong economic footing and emerge from bankruptcy a powerful force in the world’s transportation industry.
Back her down Coxswain!!! Why does the ALPA UAL MEC claim that the attack of 9/11 is a primary factor in UAL's condition, yet the ALPA Delta MEC says that 9/11 is no justification for FM and the pilot furloughs? Could this be yet another not-so-subtle line of BS from our esteemed leaders at DALPA?
Meet me out behind the conex box Duane and Johnny.
Last edited:
General Lee
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Good question Dave, NOT. Everyone knows that United was on the Titanic Watch prior to 9-11. And United "Dalpa" doesn't exist. Ignorance sucks. We didn't say 9-11 should not have resulted in furloughs---we argued for a timeline to bring them back, and we have hit that trigger. Thanks to "RJ Fred" Reid and his briliant RJ and Frequency equal dollars plan---we now have a glut of RJs and it is hard to bring in enough revenue with less seats--since we parked so many mainline planes and brought on too many 50 seaters. Now the LCCs are coming on strong with nice, new mainline sized planes--and we are stuck with too many RJs that many business people (the ones we want) hate. After our pay cuts are finalized, maybe we can get a good deal on 100 seaters, and then shelve the 50 seaters and actually bring in some needed revenue to our hubs.
Bye Bye--General Lee
Bye Bye--General Lee
DaveGriffin
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Bull sh*t GL. You and the other traitorous, al Qaeda apologist pilots argued that 9/11 was only a security issue (talk to FDJ), that war hadn't been decalred, that war wasn't necessary, yada yada yada.General Lee said:
You argued that 9/11 and our action in Afghanistan did NOT consitute FM.
Don't try to change history Mr. Revisionist.
General Lee
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Thank you for your insightful comments Dave. Pure genius. Everyone knew that 9-11 caused a large disruption in flying, and that hurt the company. We could see that. But, 9-11 only had a partial affect---the main affect was the down turning economy--and our No Furlough Clause did not allow furloughs for economic reasons. Delta tried to blame everything on 9-11---and that was not the sole problem. Dalpa fought for the furloughs, and the arbitrator agreed and set up a trigger---which was met. Some of the furloughs for 9-11 were needed, not all of them, and the trigger--which was initially thought to be a tough one to achieve--was actually hit when the passengers came back in droves. That is why Delta has agreed, reluctantly, to the recall.
That is the true history, Dave.
Bye Bye--General Lee
That is the true history, Dave.
Bye Bye--General Lee
DaveGriffin
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DaveGriffin
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That's right General Dipwad, al Qaeda attacking the US and killing 3,000 people was an economic event. You senior guys will say anything to protect your paycheck. The first enemy attack ever on CONUS, and you MEC numbnuts expalin it away to. Let the junior guys live with the furloughs and you get to pretend that you are fighting for the juniors, while you keep receiving a paycheck.General Lee said:
What a deal.
xanderman
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Well! ...Not exactly...
I think it should be pointed out that there are TOO MANY seats available now. The market is flooded. Thus your yeild will fall. It's simple supply and demand! While I don't believe that 50 seaters are the answer, bringing back 767's for example will only exacerbate the already difficult situation. You guys at DAL are in a tough spot. I do not envy you. Most of the testimonies given the House Aviation Subcommittee pointed to the fact that the load factors are high and the yeilds are low. Too many choices for the traveling public. The representitive from the S&P stated that the industry should look for ways to reduce the number of ASM's in hopes of raising the yeild. I will admit the there was talk of high fuel prices and excessive federal taxes but the subject of the yeilds was more than obviously the point to make.
Andy
General,General Lee said:
I think it should be pointed out that there are TOO MANY seats available now. The market is flooded. Thus your yeild will fall. It's simple supply and demand! While I don't believe that 50 seaters are the answer, bringing back 767's for example will only exacerbate the already difficult situation. You guys at DAL are in a tough spot. I do not envy you. Most of the testimonies given the House Aviation Subcommittee pointed to the fact that the load factors are high and the yeilds are low. Too many choices for the traveling public. The representitive from the S&P stated that the industry should look for ways to reduce the number of ASM's in hopes of raising the yeild. I will admit the there was talk of high fuel prices and excessive federal taxes but the subject of the yeilds was more than obviously the point to make.
Andy
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Wait just a minute there, I'm feeling a little hostility on these boards. Calling the General a dipwad, while maybe personally satisfying for you, is conduct unbecoming.....(you fill in the blanks). I don't want to intrude on the quality discussion taking place, but let's put those "dipwads," and "Al Qaeda ALPA" comments away, and play nice. Have a good day. By the way, Dave, are you the guy on that JAG TV show?
xanderman
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woops...sorry
Andy
Let me correct myself. I have misquoted the S&P rep. He mainly spoke of the inability of the legacy carriers to compete with the lcc's. The legacy's obviously do not want to give up market share and are forced to price competitively therefore reducing their yeild because of CASM. Sorry! I'll shut up now...xanderman said:
Andy
xanderman said:
Xanderman,
I think this glut of seats on the market today is going to hurt the LCC's too. The LCC's are adding seats at rates that are not sustainable. Between jetBlue, AirTran, Southwest, IAir, and now Virgin America, the LCC's are going to start hurting each other soon enough. I think DP's approach here at Cactus is actually smart. At every employee and investor meeting he tries to pound the point home that somethings got to give with the overcapacity in the marketplace. Will it be the demise of USAirways or mergers between the LCC's, that has yet to play itself out.
If United got the loan, it would have been given a government backing to dump seats at below cost just to fend of the onslaught of the LCC's.
One has to pause too when they hear JO talk about 737's at MESA or Skywest starting a LCC, there aren't enough customers out there willing to pay the costs needed to run all these airlines.
We have trouble filling our JFK-SFO flights when UA and AA PAY their passengers to fly their airlines. What makes Branson think SFO will be any friendlier to his brand?
Just some thoughts..
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