UAL news.........

[Extra300S]

Daniel Webster is a wannabe..

Little sissy boy Daniel Webster is a wannabe! The only 747-400 he is flying is a 1/144 scale model.

Nuff said.....

 

[Mentorplt]

DW

I think P3-Adub hit the nail on the head.......JACKASS!!!!! With the thousands and thousands of pilots on the streets I am sure he is the one filling up his wallet with extra time while his fellow pilots are collecting unemployment.

IPF

 

[KingAirKiddo]

Daniel Webster,

Shouldn't you be doing some keg stands with your fraternity brothers, or God forbid studying for some finals?

In other words...get lost, punk.

 

[DanielWebster]

I'm sorry if some of you think my opinion is unpopular. Whatever! but I heard it from a good source today, that UAL has zero chance of emerging from bankruptcy, and you can expect full liquidation in no more than 2 months.

The sooner, the better as far as I'm concerned. Then we can all get back to business, and make some money.

As far as all this positive news about UAL emerging early....blah, blah, blah.....well, apparently they are throwing millions of dollars at a PR firm in order to "improve their image".......can this company do anything other than piss money down a toilet??

 

[Cardinal]

So you're telling me that United managed to con J.P. Morgan Chase, CIT Group, and Bank One out of 1.7 Billion even though liquidation is inevitable and those inside the case know this for a fact? Sure. Even I find it amazing, but UAL seems to be clearing the DIP financing covenants, and they cannot be shut down if they continue to meet those thresholds. I'd keep typing but I really have to run to the bank, I need to mortgage some of my oceanfront Arizona property - apparently banks no longer research their investments.

 

[sstearns2]

Keep in mind that if UAL liquidates the investors that provided the DIP financing are the first ones to get paid back. It's the pre-bankruptcy lenders, leasing companies, suppliers, and regional airlines that are still owed millions, etc. that are going to get screwed.

Scott

 

[spinup]

DW,

UAL having good PR is a laughable notion, where in the world did you get that idea? Your position on UAL is fine by me, the more competitors caught on their heals with your thinking, the better for United. So by all means continue with your self-serving myopic views.

With 200,000 pax daily, the people who really matter are betting on UAL.

 

[Sugardaddy]

I believe 2 years ago there was a snake oil sales man in Atlanta preaching that by 2010, we would need an increase in air capacity the size of another "United airlines". So... DW, you have to ask yourself.... was it Uniteds bloated contract that caused the decrease in demand for airtravel? Or was there a bursting of the tech. bubble followed by a terrorist attack in the fall of 2001 followed by a WAR in Afghanistan, followed by the collapse of several Large corporations, followed by months and months and months of WAR talk, eventually followed by a WAR in Iraq.
If you want to lay some blame on the state of the air industry, why not put it where it really belongs. I believe a rebound in the economy in general, coupled with some kind of world stability would do more for the industry than something inane and silly like the liquidation of UAL.

 

[skykid]

Well said SugarDaddy - you can add the SARS hysteria to your list. It would be more convenient for alot of people if United liquidated, but that is not how the system works. Right before the war started when oil prices were thru the roof, I thought there was a 50% chance of survival. Now, the only thing that will pull United down is another major incident, like an airliner knocked down by a shoulder launched missle. Here are the things working in United's favor:

1. Oil prices came down fast! UAL wasn't hedged a barrel and a few months with those March prices would have been awful. Now hedging carries no advantage.

2. All the experts said labor would be the main obstacle to restructuring - didn't happen. 70% of the IAM voted to except the new terms - incredible! It took the war and SARS to scare those folks. The on-time performance being achieved is not possible with labor problems. When you think of who has labor problems NOW, it ain't UAL.

3. American didn't go Ch11 and probably wont unless there is another major incident. This is great for my friends at AMR - it is always worse in Ch11. Also good for United. First thing UAL did in Ch11 - slash prices and put pressure on AMR. Don't need the favor returned, and AMR can't get the same concessions from labor and others without Ch11.

4. There appears to be a modest recovery underway. The small price increase that stuck starting Jun1 is a good sign. As long as even a very modest recovery continues (in other words we don't have another major terrorist act soon) UAL is going to meet all the DIP hurdles. You can't focus on the inflated/write off everything but the kitchen sink losses - look at daily cash burn and cash on hand.

5. Cash inflow. Tax refund + Gov money + aircraft sales (rumor has it with the 747 cap & fo bids that just came out UAL isn't selling as many 400s) = about 1 billion dollars. Not good news for people who want UAL to run out of money. UAL "posted" a 375 million dollar loss in April when SARS and the war had the worst affect, but came out of the month with more cash on hand because of the tax refund.

6. Big bad creditors myth. Alot of folks who write on this board seem to think the banks can't wait to force liqudiation. Everyone has a friend who heard from a buddy that the banks are just about to strike. Do you also think the mortgage company can't wait to take away your house if you miss a payment? More likely the ahead of schedule cost reductions have bought leeway on the DIP goals. That's just what the Wall Street Journal thinks - they probably don't know as much as D Webster.

7. Bankruptcy court rulings. The bankruptcy judge has ruled in UAL's favor every single time. CH11 is about keeping the wolves at bay while the company reorganizes, and that is what this judge is allowing.

8. Leadership. This is something UAL hasn't had in a long time. Glenn Tilton has turned UAL into a LCC in 6 months and is now surrounding himself with people who can find revenue. You may not see the separate LCC (code name Starfish) because the whole freakin airline is a LCC now. When Tilton says UAL may come out of bankruptcy sooner than next Summer if the timing is right, he is not joking. 2 months ago he asked employees to get ready to take even more cuts if the war was more severe to ensure survival. He wasn't playing then either but it wasn't even close to being necessary.

The guy in the know though is Ty Webb. Ty says UAL doesn't have a rat's a$$ chance. He even posted a picture of a UAL plane crashing on this board. I don't think that is a bit tacky. So there you have it. Seriously, the bad news is it going to take a few decades to get pilots pay back up, if it ever happens. These new contracts at the majors will put a lid on everybody's pay, in my opinion.

 

[Extra300S]

Skykid...

That was the most insightful post I have seen on this board yet!

Good job Skykid...

 

[Mentorplt]

Ty Webb....wasn't he in Caddyshack???

 

[Boz]

Went to TK yesterday and heard from management its latest regarding furloughs...Sorry to say the news was not encouraging as S.F. reported at least 60-70/month for several months to come.

The LCO is getting very little attention from the creditors as they want to concentrate on running the UAL brand and attract back many lucrative business customers that they have lost to AA, DAL, NWA and others over the last 24 months.

They stated that UAL is going to emerge from CH.11 sooner then expected and if the summer traffic rebounds from last years levels than it looks like Fall or early 1st quarter of 2004 which is still ahead of the initail date announced back in Dec. 2002.

Also, as far as furloughs go they are painting a picture of the airline being manned by about 7000-7500 pilots and this could all change if the direction of management shifts to take back more flying from UAX. The fact is the decision as to which UAX carriers fly what and UAL takes back has not been announced yet.

UAL is carrying greater than 200,000 pax a day with an average of 1550 flights/day and a load factor around 75-85%. Combine this with operational excellence goals that have exceeded many company records has kept them on time and leading the industry so far.

The concessions where a major milestone as far as the company and the unions hammering it out instead of the judge doing it for them. Either way UAL was going to get the labor savings one way or another from the unions and UAX carriers.

All in all the Ch.7 talk is just that TALK! The company is going to emerge from CH.11 sooner than later and it seems like a road map to get profitable is taking shape. The goal has shifed from getting labor savings to aggressivly making the airline profitable. Plan on seeing a major advertising blitz in many UAL hub cities soon.

Myself and many other UAL pilots will be working hard to win back customers and get UAL growing again so the furloughed pilots have a stronger airline to come back to.

Hang in there !

 

[Full of LUV]

Chapter 11 Good????

Skykid,

Nice post overall, but my question is if Chapter 11 is such a good thing, then why did AMR management stop short of it. Seems there must be some negatives to it as well, or is it a misstep by AMR's management as you seem to allude to?

 

[skykid]

LUV, I don't think Ch11 is a good thing at all. For one thing, you are going to lose some customers who hear "bankruptcy" and fly on somebody else due to ignorance of what Ch11 is or fear they will be stuck with tickets that are no good. It hurts the brand name for sure. The press is going to sell newspapers and t.v. time with stories about how you may be gone. You have to secure exit financing. There is a sense of failure. Look at the track record of bankrupt airlines. Anybody would claw and scratch to avoid Ch11

I do believe mgt will get better lease deals and concessions from all players under Ch11. At UAL, the gun was to the head. At AMR, it was - give concessions or we'll put a gun to your head. At Delta, its - we need concessions or we are going to put a gun to your head some time in the future.

What you are going to see now is reports of how United will secure somewhere between 1.5 and 1.8 billion in loan guarantees from the ATSB. Had AMR gone Ch11, they don't have that door open to them. Take care.

 

[Extra300S]

Speaking about the ATSB loan.....

Reuters
UAL Moves to Shore Up Loan Guarantee Bid
Saturday May 31, 5:09 pm ET
By John Crawley


WASHINGTON (Reuters) - United Airlines (OTC BB:UALAQ.OB - News) chief executive Glenn Tilton (News) said on Saturday he was firming up the carrier's $1.8 billion federal loan guarantee bid around a plan that would rely on substantial cost savings and several strategies to boost revenue and capture business travel.

Speaking with reporters at an industry event, Tilton also said he would not be pushed into setting a date for exiting Chapter 11 protection. He noted that a separate low-cost carrier remains an option but a potentially less competitive one, since the company was unable to secure key labor agreements it felt were necessary to maximize efficiency.

"We have to find a competitive response that works for United with respect to low-cost traffic, not necessarily low-cost carriers per se," Tilton said.

Nevertheless, he said United is sharply focused on winning back premium customers who have deserted big airlines in droves since mid-2001. "We're going to make sure we continue to focus on the core of United's passengers -- that is the business traveler."

The company's retooled application for loan guarantee assistance would include $2.5 billion in labor concessions and related work rule savings over the next six years; close to $700 million a year in savings from renegotiated aircraft leases and other mortgages that are close to being finalized, and a new revenue outlook, Tilton said.

Still to be determined as part of United's recovery plan is the amount of Chapter 11 exit financing and who will supply it, as well as the scope of a low-cost operation, and a final lineup of regional carriers.

Tilton would not identify parties that have expressed interest in providing exit financing.

United plans to submit a business plan to creditors and lenders in the early part of June and will then file a formal restructuring proposal with the U.S. bankruptcy court in Chicago later this year -- probably in the early fall.

Tilton said he is working closely with the government's Air Transportation Stabilization Board to replace those aspects of the company's original loan guarantee bid -- rejected as inadequate in December -- with new figures.

While promoting the economic merits of exiting bankruptcy at the start of the spring travel season next year, Tilton would not yield on whether United would emerge at that time.

"We want to exit Chapter 11 after we are sure there is precious little value left on the table," he said. "My plan is to sweep the table of all the benefits available to us rather than be expedient."

United reported last week that it sustained a $375 million net loss for April as demand weakened because of the war in Iraq and the SARS virus that has hurt Asia travel. That followed a $1.3 billion loss in the first quarter.