Will United Survive?

[BLUE BAYOU]

I tend to agree with HOGDRIVER. It is difficult to allow the government to continue to bail out unsuccessful carriers. Handouts have already been doled out to stabilize the industry. One example, Midway Airlines took the money, operated for two more months and then died-- what a waste of taxpayers' money. There are carriers still operating in the black-- Airtran, Southwest and JetBlue. It'd be a hard sell in Congress...

 

[WhiteCloud]

Re: Not their job

Why should the federal government care?

The feds sure put a lot of regs, licencing and tax requirements on Airlines because "they care". A big part of the US economy is tied to an effective transportion system. Ziggy1

 

[RocketRob]

Plan for separate budget carrier dropped
By Heather Draper, Rocky Mountain News
February 1, 2003

UAL Corp. has backed off its controversial plan to launch a low-cost carrier as a separate airline after union members said there was no way they would back such a plan.

Sources close to the bankrupt company said Chicago-based UAL is still pursuing starting a low-cost carrier, but flying it as a UAL Corp. airline.

Late Friday, the union representing United Airlines flight attendants confirmed that, saying in a letter to workers that it is "assured that United is not entertaining operating this competitive element as a separate carrier."

UAL Chief Executive Glenn Tilton had floated the idea to the unions of UAL spinning off a low-cost carrier as an entirely separate company, but it was met with harsh opposition.

The pilots and the flight attendants publicly berated the plan, saying spinning off a separate airline would break up United Airlines and force senior United employees to start over at a new company at much lower wages.

"The plan to form a separate, startup carrier by siphoning off United's best assets may be a good plan for the new startup carrier, but it will be the demise of United Airlines," the Association of Flight Attendants said in a letter to employees on Wednesday.

Tilton and UAL senior management presented their blueprint for reorganization to the UAL board of directors on Thursday. UAL has not made its preliminary plans public.

The board, which includes representation from two employee unions, unanimously supported the preliminary plans laid out Thursday, which didn't include the separate airline idea, sources said.

Pilots union spokesman Dave Kelly said he still hadn't seen the full plans yet but that his understanding was that the board "made it clear to Tilton that it was not interested in a low-cost carrier as it was earlier presented."

"They basically said, 'If your vision means a separate corporation, we are not interested in pursuing it,' " Kelly said of the board.

UAL spokesman Chris Brathwaite wouldn't release details Friday about the company's plans for a low-cost carrier, but said the entire board - including Paul Whiteford, the pilot's representative - was behind UAL management's preliminary ideas to get the company out of bankruptcy.

"The board will be fully engaged in this process going forward," Brathwaite said. "The next step will be to continue sharing the plan with our employees and our constituents."

UAL presented its reorganization framework to advisers for its creditors committee on Friday.

The company will hold a daylong officers meeting Feb. 10 to discuss its reorganization plans, according to a recorded message to employees on Friday.

Tilton and other senior UAL managers will then fly to different United Airlines hubs on Feb. 11 to present the plan to employees and other constituents, the message said.

 

[flounder]

airline recovery

During this time of air travel slowdown, as severe as it is, it may be useful for those of us interested to step back and look ahead a few months. Look at how air travel may be affected worldwide when companies begin spending again on capital equipment, and begin aggressively competing with each other for business instead of making cost cutting a top priority.

Because of geopolitical events mainly, it's generally accepted that businesses and many consumers are temporarily on hold. Although anything can happen obviously, and this paralysis could last a long time, history would suggest that we usually get through these difficult situations sooner than we think. I noted during the 1990 recession(a bad one-California was crushed) a serious analysis/pronouncement by a 'top', world renowned 'expert'__ that it would be 10 years before the US economy recovered. Well, the recession was short and sharp but, of course, recovery was firmly under way by the early 90's.

So at the risk of sounding too optimistic, here are a few what ifs:

-What if a certain Middle East based tyrant decided later this month to vacation permanently in North Africa.
-What if renewed Middle East peace negotiations actually began to look fruitful.
-What if the North Korean situation continues to cool off.

Diplomatic and other forces are working to help these what if type
scenarios play out positively.

Snowballing effect what ifs: (beginning within the next 6 months)

--What if businesses(worldwide) rushed to order products to replenish RECORD low inventories.
--What if businesses, as growth resumed following geopolitical relief, realized that competition demanded that company reps needed to meet face to face to close business deals(as has always been the case in spite of new video conferencing technology). And so company 'road warriors' are sent out in increasing numbers.
--What if this summer more leisure travelers finally fly to see family or to vacation(having decided that another 2000 mile round trip saga by car would be more painful than air travel, or
that staying home another summer is out).

--AND so what if this July, because of airline capacity cuts, business travel coordinators and leisure travelers begin having difficulty finding seats when they need to travel. Airlines raise fares, but most vacationers pay because they've delayed their trip for several years. And bizjet charter companies are now booked partly because of a scarcity of business class airline seats at certain times. And in frustration at not being able to find air travel arrangements for overdue summer trips, many leisure travelers immediately make airline reservations for both Thanksgiving and Christmas holiday trips.

Probably never happen.
And yet the United States has a 10 TRILLION+ dollar economy, interest rates are rock bottom, Europe is actually becoming more(slightly) business friendly, barriers to world trade are relatively low, the population continues to grow as do incomes---

We'll see.

 

[HA25]

Re: airline recovery

During this time of air travel slowdown, as severe as it is, it may be useful for those of us interested to step back and look ahead a few months. Look at how air travel may be affected worldwide when companies begin spending again on capital equipment, and begin aggressively competing with each other for business instead of making cost cutting a top priority.

Because of geopolitical events mainly, it's generally accepted that businesses and many consumers are temporarily on hold. Although anything can happen obviously, and this paralysis could last a long time, history would suggest that we usually get through these difficult situations sooner than we think. I noted during the 1990 recession(a bad one-California was crushed) a serious analysis/pronouncement by a 'top', world renowned 'expert'__ that it would be 10 years before the US economy recovered. Well, the recession was short and sharp but, of course, recovery was firmly under way by the early 90's.

So at the risk of sounding too optimistic, here are a few what ifs:

-What if a certain Middle East based tyrant decided later this month to vacation permanently in North Africa.
-What if renewed Middle East peace negotiations actually began to look fruitful.
-What if the North Korean situation continues to cool off.

Diplomatic and other forces are working to help these what if type
scenarios play out positively.

Snowballing effect what ifs: (beginning within the next 6 months)

--What if businesses(worldwide) rushed to order products to replenish RECORD low inventories.
--What if businesses, as growth resumed following geopolitical relief, realized that competition demanded that company reps needed to meet face to face to close business deals(as has always been the case in spite of new video conferencing technology). And so company 'road warriors' are sent out in increasing numbers.
--What if this summer more leisure travelers finally fly to see family or to vacation(having decided that another 2000 mile round trip saga by car would be more painful than air travel, or
that staying home another summer is out).

--AND so what if this July, because of airline capacity cuts, business travel coordinators and leisure travelers begin having difficulty finding seats when they need to travel. Airlines raise fares, but most vacationers pay because they've delayed their trip for several years. And bizjet charter companies are now booked partly because of a scarcity of business class airline seats at certain times. And in frustration at not being able to find air travel arrangements for overdue summer trips, many leisure travelers immediately make airline reservations for both Thanksgiving and Christmas holiday trips.

Probably never happen.
And yet the United States has a 10 TRILLION+ dollar economy, interest rates are rock bottom, Europe is actually becoming more(slightly) business friendly, barriers to world trade are relatively low, the population continues to grow as do incomes---

We'll see.

I love it, another optomist! I'm not alone!

 

[120% Torque]

I will remain an optimist in general but believe we will go to war within the next 4 to 8 weeks. Once the black cloud of war looming over head has been semi-removed things might start looking up. This is barring any further aviation accidents, that people dont associate a crashing space shuttle with crashing airplanes, and that no more immediate terrorist activities take place. Businesses are still hurting and will be for a while but all the shedding of inefficiency (not just in aviation) will begin helping busineses start to gain traction again. We have had a lot of bad things happen in a short period of time. Enron accounting scandels and the collapse of some very large businesses and accounting firms that were supposed to be checking and balancing otherwise healthy businesses, 911, collapse of the overpriced dot coms..... At the very least things are being put in order for lean, mean, efficient companies to emerge and prosper. My 2 cents anyway.

 

[Publishers]

Leadership

The fact is that there is no question that the United that will come out of this is not going to be the United of old or anything like it.

Equally obviously, if you are an employee who has been there for awhile, the last thing you see happening is the disassembly of the airline.

If management comes up with a plan and you do not let them implement it because it is against your self interest, then what chance do you think anyone has of moving forward.

The short version is:

We do not like our current management-- they have brought us to this mess.

We have a new guy we like better with a plan.

OOPS, we do not like the plan because it is going to impact us in a way we do not like.

We do not like current management, they have brought us to this mess.

 

[Heavy Set]

Regardless of what happens, UAL pilots are not going to be very happy. Either Chap 7 with all employees cut or a revamped, watered-down UAL with significant changes, much lower pay and many, many furloughs...

The dominant UAL of the 90s seems quite far away... I knew an Alaska 737 junior captain who gave up his position to get on with UAL - he was among the first 500 or so to be furloughed - ouch....

 

[Bally]

The culture at UAL is not one that will result in its ability to recover. I now fly with a pilot who became an FE at UAL after he passed 60 years of age. He worked at UAL for 25 years. It amazed me that he boasted to me that he was earning a six figure salary at UAL being an FE. This makes no sense at all.

The reality is that pilots should not be earining $300+K per year. I'm sorry, we are not worth that much money. That is more money than many CEO's at successful companies earn. No wonder UAL is bankrupt.

Flight Attendants should not be earning 50+K per year. The idea of a "career FA" also makes no sense to me. I have a long time friend who has worked at UAL for 14 years as a FA. I have watched her over the years take on an atitude of entitlement that without a doubt was fostered by the union. This me me me atitude is the reason for UAL's problems.

What must it be like to work at a company where everyone is negative and complains that they are not getting enough. Then they have a tantrum and have a work slow down or strike.

The greed of the unions has resulted in UAL filing Chapter 11. The same greed will most likely result in UAL filing chapter 7.

Shame on the union leadership for destroying a company. United has been around a very long time, and has played an important role in US Aviation history. It's demise is on the sholders of the labor unions.

 

[Networ-King]

Bally,

I agree with you that unions have pretty much anialated (?) some great carriers. I am also with you on the fact that we as pilots should get no more then 300K a year, but pilots should have to work for that money like the pilots do at SWA or Jetblue. I know they don't make anywhere close to 300K a year, but they do the low 200's. But you have to also remember one thing about our profession....... you have to be performing at 100% at your job everytime you takeoff and land that GIV of yours or else you end up at the wrong airport or you end up killing people ........ I have to perform my job at 100% everytime I go up........ whether I have something on my mind or not..... a cold, a divorce, a sick kid .....whatever.... we all have to perform our jobs at a percentage that no other career demands. Well maybe doctors. Also don't think that the unions did all of this to United by themselves. That great company was brought down by management mostly....excuse me.... by mismanagement and yet Goodwin is somewhere out there fat dumb and happy with a few millions in his pocket after he brought United to its knees. What percentile do you think he was perfoming his job at? and yet he's a millionaire before us. Well before me anyways. Im furloughed from one of the majors and I don't think we should be getting paid that kind of money for the "easy" international flying that my company does. And yet there are guys out there that think 9-12 days of work flying to england, resting for 24 hours then flying home and being off for 4 days is work 500K a year. Its sad, but think about it.............................How much are you worth?

 

[hopeful]

The problem with UAL is not 100% related to labor costs like you would like to think. Poor management is our problem. Cut labor to nothing and we still have a f'ed up airline. Our management is pathetic and labor costs are not the cause, just the result. We are not going to make pennies on the dollar while management is making millions on our backs. I agree it is a give or take world, but our management is the worst. They have driven us into an oblivion. We took a 29% pay cut and you think that helps? No. We could take a 95% pay cut and UAL is still not going to be healthy. Poor management. Simple as that.

 

[A4Forever]

Bally.. Boy are you right. If it hadn't been for those lousy Unions, all pilots would be working 90 hrs a week for peanuts and loving every minute of it! I don't know where you have been for the past 50 years, but managment hasn't given out pay raises and benefits like medical, retirement, ect because they love the employees. Have unions been unrealistic at times? Probably so. But you don't make what you make today because you deserve it. Some where along the way a union pilot set a precedent for you. Better thank them for what you have today. How many pilots at UAL make 300K/yr? Out of 9000 pilots there, they have (or had) about 300 747-400 capts who are the highest paid, and they don't make that much. As for the flight attendents making a career out of their jobs, you can blame the unions who said you couldn't discriminate against married or older F/As. If it hadn't for equal rights, those women would have had to quit at 35 or when they got married. Can you believe the nerve of the unions to push for equal rights? And to pay a flight attendant who is a single mother of 2 with 30 years of senority 50K for working 18 days a month is outrageous! As I said, you are right. Unions have ruined everything!

 

[Bally]

Points well taken. I overgeneralized by saying that the labor unions at UAL are 100% to blame. They are surely not. Only about 80%. The person who thinks I am an idiot. Come out of your union cave and read something other than the montra from your union. I grew up in Detroit with both parents in the UAW. I am for unions. Yours however is joke.

With all due repsect, you need a larger pay cut than 29%. Having two kids does not "entitle" someone to pay greater than the job is worth. Difficult concept for many union members to understand.

The comments from Networ-King were outstanding. The responability of the pilot is without huge. The reality is that business must make a profit, and the sumation of the cost elements on the P & L statement need to be less than the revenues.

Nighty Night

 

[Midnight Mike]

Will United survive? I hope they do, if anything happened to United
plenty of people would be out of a job. TWA was in & out of bankruptcy
for years, so United should be around for a while.

There is plenty of blame to go around for the crisis at United, the blame is to
be shared equally.
It was the employees that scared the passengers away with the summer of 2000
work slow down and insisted on a very large pay raise.
It was the Union that forced the company give the employees a 29% pay raise.
It was managment that agreed to give the employees the 29% pay raise.
It was the employees who did not listen to management when warnings were given
as to the financial health of the company.
It was managment that did not speak loud enough and force the employees to listen.
It was the employees that fought against pay cuts, and perhaps was one of the
reasons that United did not receive the loan.
It was the employees that did not like United owning hotels and rental car companies
and broke up a very powerfull company.
It was management that did not try hard enough to stop the break up.

There is no one reason for this failure, and it took many years, perhaps
we can start a new topic, "What does United Airlines need to do to survive?"

Mike

 

[P3-Adub]

Chicken Buzzards !

Never seen so many pilots standing around jerking off at someone elses suffering ! Time will tell. I was not around when TWA and Continental were in the dumper, was there this much bloodsucking going on then ?

Did I miss the jackass 101 class somewhere along the line ? I suppose that some of you would be happy to see 80,000 folks lose their jobs ? Just remember, it might be you some day !


Good luck !

 

[100LL... Again!]

The only thing that can save a company that far down financially is the following:


#1
Completely new management. Even if the old team could do it, they are not trusted much by the employees. That alone is FATAL.

#2
An attitude of emergency recovery among the employees.
Give 100% every day - even if you think management won't recognize or reward it. You wait for that.. you're doomed.

Basically, you have to love your job more than you hate management.

 

[120% Torque]

I think one must be careful to distinguish between the so called "evils" of having a Union and the evils of greed. Is money evil? Money can be used for good or evil the same as a Union can be used for justifiable advancement in ones workplace, work rules, safety, etc or it can be used to strong arm the company to give up too much. I think it is imprortant to point out that without unions a pilots quality of life would be much lower and chances are we wouldn't have the level of safety we enjoy today.

 

[WhiteCloud]

There is plenty of blame to go around for the crisis at United, the blame is to
be shared equally.

Wasn't there a big deal a few years ago about the Employee/Owners of UAL? I thought the major Stockholders were/are the pilots and other employees. Ziggy1

 

[KDA or DEATH]

Fuggedaboudit....

...Low-cost/low-schmost , This-that-and-the Otherthing, economic recovery, fuel prices, or perhaps the Mother Mary being sighted in a UAL tail logo...All speculation and guess work for Industry Klowns.

Read:

Aviation Week and Space Technology / Jan. 16th issue.

3-4 articles, spanning approx. 6 pages, all address UAL's "Marching Orders" as requires financial performance set forth by their Debtors-in-Possession.

Failure to meet these (impossible) caveats financially will lead to immediate liquidation for UAL.

The following seems obvious:

Realizing a HOPELESS situation... Management (after being turned down for cash by the ATSB) has BOUGHT TIME to CLEAN UP THEIR OWN HOUSE.... via Debtor-in-Possession Financing.

The 4 banks who put forth the 1.5 Bil to operate in Bankruptcy, and who hold the caveats to instantaneously drive UAL into Chapter 7 (liquidation) know two things:

1) Survive: WE win.

2) Fail: WE WIN BIG!!!

Sounds like a good bet to me....

Before you folks begin to flame me...Read the article so we can have an intelligent discussion, please.

I hope UAL makes it, but the second coming of "JC" Himself will probably happen sooner.

YKW

 

[Publishers]

Switch

Imagine if we let some of these bankers fly aircraft,

Well that is how scary it is when pilots talk about business.