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United losing 8 747s to creditors?

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United Airlines' Parent Company Ends Wrangle Over Renegotiated Aircraft Leases


CHICAGO (AP) -- United Airlines' parent company said Tuesday it has resolved a contentious dispute over renegotiated aircraft leases involving about a quarter of its fleet, moving the nation's second-largest carrier a step closer to exiting bankruptcy.



UAL Corp. announced an agreement with a group of finance companies that settles the leases for 105 of its 455 jets, with a transaction pending on the remaining 14 aircraft.

The agreement, which United said was reached Saturday, ends a protracted fight over the aircraft and essentially removes the threat they could be repossessed. The newly lowered rates also will cut its costs by $300 million annually, pushing to about $850 million the total in reduced yearly fleet expenses since it began its bankruptcy overhaul in December 2002.

"This agreement, if approved by the bankruptcy court, overcomes one of the last remaining hurdles in United's restructuring and upcoming emergence from Chapter 11," said Jake Brace, chief financial officer for the Elk Grove Village, Ill.-based company.

The airline had reached an agreement in principle with the planes' lessors last summer but subsequently nixed the deal, citing ever-rising fuel prices and the need for further cost reductions due to difficult conditions in the airline industry.

A rebound in the market for leased jets made it tougher for United to secure the terms it wanted, and a May court ruling by the U.S. 7th Circuit Court of Appeals cleared the way for lessors for take back dozens of planes unless United paid its rent in full at the original lease rates. The airline returned four Boeing 767s to leasing companies soon afterward but was able to avoid losing more for the key summer travel season.

The company said it intends to file a motion requesting approval of the agreement in the next couple of weeks, with a hearing expected in early to mid-September.

Still left to resolve in bankruptcy are filing a long-delayed business plan and obtaining $2 billion to $2.5 billion in loans. In announcing the latest delay on Aug. 2, United said it expected to file a business plan in about a month and is now targeting late this year or early 2006 for leaving bankruptcy.

United has lost more than $2.5 billion this year and over $7 billion since entering bankruptcy. It hasn't made a profit in more than five years.
 
Do you want a medal for sitting in BK for 3 years? You still aren't out yet, and doing damage to everyone else in the process. ORD is now losing money for AA because of your ridiculous fares, and to add insult to injury only one these companies actually pays for operating out of ORD, do want to guess which airline it is?

Tilton takes more bonuses and you have your pension terminated, your pay rates on a comparitive level are below JetBlue's. You business plan still does not account for oil in the mid $50s, yet alone in the mid $60s, how do you propose getting around that? Let me guess, how about another round of paycuts.

You haven't inched anywhere near leaving BK, and articles by these airline anaylsts have about as much credibility as Ms Cleo.

AA
Disclaimer: More upset with the managment team (can actually call them that) than anything else.
 
So if UAL had simply liqidated, you guys at AA could have gone right back to the old way of doing business, right? Eventually, you would have wound up competeing against LCC type competition at ORD just like everywhere else. A UAL liquidation would have given you a temporary reprieve, but eventually all the problems you face today would be back on the front doorstep. To think otherwise is denying the unfortunate realities for the future of this industry.
 
Where in my post did I say ANYTHING about you liquidating? If you are gonna bark back atleast be accurate in what I said.

I am not worried about UAL liquidating, I am worried you will take more concessions, and stay in BK another few years putting more pressure on the carriers out of BK to follow suit. What Tilton has done to UAL and the BK code is the biggest corporate disgrace I have seen next to Enron.

AA
 
AAflyer said:
Where in my post did I say ANYTHING about you liquidating? If you are gonna bark back atleast be accurate in what I said.

I am not worried about UAL liquidating, I am worried you will take more concessions, and stay in BK another few years putting more pressure on the carriers out of BK to follow suit. What Tilton has done to UAL and the BK code is the biggest corporate disgrace I have seen next to Enron.

AA

Speaking of barking, did I say that you said that? I said so, if.... which was meant to create a hypothetical situation in order to make a point. I'll try to word things more carefully when I respond to your posts next time so you don't feel offended or barked at.

As for Tilton, he is really doing the dirty work that the capital markets are demanding. With no exit financing from the capital markets, the show is over. The investment banks have continuously given strong indications of what they are looking for to entertain the possibility of engaging. Realistically, like it or not, Tilton hasn't had much choice in the matter because he doesn't control the banks. NWA and DAL may soon find the capital markets re-writing their contracts as well. I hope you can stay immune to it, but I doubt it in the long run.
 
AA Flyer,

>>doing damage to everyone else in the process. ORD is now losing money for AA<<

AA only exists at ORD b/c they moved in during the UAL pilot's strike of '85. So excuse us if your damages don't really concern us. As for the race to the bottom, with such a distinguished history I'm sure we have nothing to fear from the concessions your pilot group will ink in BK.
 
Wow, how quickly we forget. For the record, AA is the one who introduced to the industry the B scale (I've got mine I don't care about you) and UAL stood up to management and basicly eliminated it from our industry.
Nothing personal guys, but an AA pilot complaining about UAL is pretty hypocritical.
 
Wrong,

How easy it is for people to talk with out understanding history! The UAL guys started the B scale process with the Blue Skies Agreement and Dicky Ferris back in the early 80s.

Amazing ALPA pilot do not remember ALPA history, go ahead and blame APA.
I love that excuse," let's see how far you sink in BK." Well ok, how about we undercut your wages when we go into BK.

You UAL guys are something else, walking around with your nose in the air after your 2000 contract, looking down on everybody else. Telling the old TWA guys their airline should go out of business because they were dragging down the industry, now all types of pathetic excuses of where your contract is, and lastely UAL guys throwing out the "B scale comment" when they actually strarted it with Blue Skies.

And some of your guys have the b@lls to tell JetBlue pilots they can't sit on your jumpseat because they are destroying the industry. Talk about calling the kettle black.

AA :rolleyes:
 

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