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How Much Of A Head-start Does UA Have?  
User currently offlineMattnrsa From United States of America, joined Dec 2002, 431 posts, RR: 2
Posted (13 years 3 months 3 weeks 22 hours ago) and read 4791 times:

Now that bankruptcy proceedings are in effect for UA, with pay concessions and lease reductions already in place and work rule changes within the next months, how much of a head-start does UA have over AA? I know AA had more cash in hand than UA (that is why UA is already in bankruptcy), but AA has been losing more, and UA's cost structure is already lower, with the costs continuing to decline.

If/when the war starts and the airlines really start hurting, how much will UA's head-start in reform help? Is UA still definitely the first airline to liquidate, or will having all the concessions/changes already in effect be a critical piece of its survival?

10 replies: All unread, jump to last
User currently offlineCch362 From United States of America, joined Apr 2001, 147 posts, RR: 0
Reply 1, posted (13 years 3 months 3 weeks 22 hours ago) and read 4775 times:


All of the cost "reductions" achieved so far at United are temporary. What the company needs are permanent cost reductions and none has been agreed to so far. And reading the vitriol (whether justified or not) coming from the labor groups, especially the mechanics, it doesn't appear that it is anywhere close to a happy resolution.

User currently offlineSpeedport From United States of America, joined Sep 2001, 284 posts, RR: 0
Reply 2, posted (13 years 3 months 3 weeks 21 hours ago) and read 4760 times:

Short of someone putting a bullet in Hussein's head soon, I don't think there is really any doubt a war will happen. It all boils down to the war's length and whether or not Iraq makes good on its promise of suicide bombers in this country. Too bad the TSA has slowed implementation of guns in the cockpit. Knowledge of armed pilots would go a long way in the mind of the public when it comes to air travel safety.

An advantage UAL would have is it would be better able to press its case before the BK judge for voiding the contracts if it were fighting for survival because of the war. AA would rely on force majure(sp) to side step the contracts with it's unions, but those contracts would be back in force at the end of hostilities. AA would still be faced with negotiations while UAL would be operating without contracts.

The down side to this, according to ALPA, is that UAL would then face a hostile work force if it took this route. Perhaps this is why UAL wants to hire people from other companies to man its LCC. You don't have to deal with disgruntled employees if you lay them off and not rehire them for the LCC.

User currently offlineMattnrsa From United States of America, joined Dec 2002, 431 posts, RR: 2
Reply 3, posted (13 years 3 months 3 weeks 5 hours ago) and read 4673 times:

Cch362...I thought the pay reductions were permanent, and only the first of many changes we're about to see, making the success of the LCC more likely. AA and UA (and probably other majors) will most likely have an upset workforce after losing the great perks we enjoyed for so long, but I also think those most unhappy are the most vocal, with most employees at all carriers realizing how serious the situation is.

Would UA's head-start make it conceivable that AA would be the first to liquidate (not that either carrier's liquidation is very likely)? I know that seems extremely far-fetched, but it seems AA management is just now getting serious on their rhetoric with employees. UA got serious approx 1 year ago, and they are only now seeing their costs come down. If AA takes a year, they could burn through some serious cash.

User currently offlineCch362 From United States of America, joined Apr 2001, 147 posts, RR: 0
Reply 4, posted (13 years 3 months 3 weeks 5 hours ago) and read 4642 times:


Here is a quote from UAL's pilots in a recent press release:

"Today, our pilots, following the advice of their union leadership, acted in good faith to accept an immediate 29 percent temporary wage cut that provides interim financial assistance to help stabilize the Company in the initial months of bankruptcy and to provide a substantial additional period for further negotiations. Our union leadership now calls upon the Company to reciprocate by working with ALPA on a plan to reorganize the Company."
- UAL-MEC Chairman Captain Paul Whiteford, January 7, 2003

Similarly, the pay cuts imposed on the mechanics by the bankruptcy court on January 10 are temporary as well.

Everything, under the current terms agreed with the labor groups, will "snap" back to the status quo at a later time. Thus, United has made no headway whatsoever to solving its biggest problems. We'll have to see how the low-cost carrier plan revealed today flies with the pilots, mechanics and flight attendants.

User currently offlineUal777contrail From , joined Dec 1969, posts, RR:
Reply 5, posted (13 years 3 months 3 weeks 4 hours ago) and read 4600 times:

First off cch362, the low cost carrier isn't flying with the pilots. They are afraid that if they have to go to this low fare carrier(not ua) then they will take a hit in pay, seniority, work rules. They don't have a say in it, they dispute the new carrier and UA goes to the bankruptcy lawyer and he throws out their contract.

second, when UAL took the pay cuts we all new they were and are temporary. We will get the permanent pay cuts I believe may 1st. If we survive that long. And last I think we do have a head start on AA because of the fact we are starting to save money with our initial pay cuts and AA has a long and ugly road ahead of them trying to convince the help they need it. Didn't we read today that labor isn't happy with carty and the others because they promised a 22% cut in management? See the employees aren't believing them now, so they need to work on that.

and sorry, lastly. The mechanics at UA aren't in a position to barter, their jobs are already on the line. I feel the end is near for most if not all of our mechanics. Boeing and FBO'S can do the job they say only they can do.

ual 777 contrail

User currently offlineAA717driver From United States of America, joined Feb 2002, 1566 posts, RR: 13
Reply 6, posted (13 years 3 months 3 weeks 2 hours ago) and read 4567 times:

The UA LCC is already being called a SCAB airline. It is a non-union airline flying the planes and routes of a union carrier. There may not be any shortage of people willing to fly for it--but they should be aware ahead of time exactly where they stand if they accept that job.

When someone takes a job at UALCC, they are taking the job of a union pilot who will be furloughed.TC

FL450, M.85
User currently offlineFlashmeister From United States of America, joined Apr 2000, 2939 posts, RR: 6
Reply 7, posted (13 years 3 months 3 weeks 2 hours ago) and read 4544 times:
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When someone takes a job at UALCC, they are taking the job of a union pilot who will be furloughed.

Your point? If the union guy who is facing furlough really wants a job, they'll take the LCC job. Life isn't fair for the rest of us either... Welcome to the real world.

Personally, if there's an airline that's really going to be ballsy enough to stand up and work to keep their pilots non-union, I'd happily divert my business to them.

User currently offlineGigneil From United States of America, joined Nov 2002, 16347 posts, RR: 79
Reply 8, posted (13 years 3 months 3 weeks 1 hour ago) and read 4530 times:

I agree. I would divert as much of my business as possible to a completely non-union airline.

If I flew to New York more, I'd patronize jetBlue as much as possible.

Flashmeister is right. I'm sure that UAL is giving the furloughed pilots the opportunity to fly with the LCC and not be part of a union. If they don't take it, they deserve unemployment.


User currently offlineCch362 From United States of America, joined Apr 2001, 147 posts, RR: 0
Reply 9, posted (13 years 3 months 2 weeks 6 days 23 hours ago) and read 4504 times:


My biggest concern with United is with IAM. I don't think it is beneath the IAM to instigate a strike to end everything; it is struggling to keep representing the mechanics if the company survives, so what does it have to lose?

The kind of angry talk coming from the union leadership just gives off an aura of distrust for management - the same old tired routine of posturing at a time when the priority should be a cooperative effort to steer the company back on course.

United must be concerned that it cannot just throw out all of the existing labor contracts and expect the employees to roll over and take whatever is thrown at them. United employees are very proud of their company (and justifiably so), but there is also a high degree of distrust for management that they often believe that the management's decisions are often not in the company's best interest.

User currently offlineUal777contrail From , joined Dec 1969, posts, RR:
Reply 10, posted (13 years 3 months 2 weeks 6 days 13 hours ago) and read 4438 times:

please,please,please don't make the mistake between the IAM 141 and the IAM 141-M. We at the IAM 141 are happy to take the wage concessions and not everyone hates management. I am going to go out on a limb here and say I like the way Tilton is running things, I have put my faith in him from day 1. The IAM 141M has absolutely nothing to lose, like I said in my first response that they know their days are numbered. I asked one of our union reps the other day why is it that we as the csr's and res agents vote in the 6% pay cuts and then UNITED asks us to take a 13% pay cut we were never allowed to vote on it. Instead they lumped all of us together. Now have 13000 mechanics who are either disgruntled or will vote no looming over your head or now you have 34000 pissed off UNITED employees. I was mad they wouldn't let us vote, and as for what AA717DRIVER said. I guess I would be a scab for two reasons, 1) I want to continue to work in the airline industry for united or this new company. 2) I don't like unions and I don't like ours that is supposabley representing us right now. When your future is on the line you either 1, start looking for alternate employment or you keep up on company events and hope the company pulls through. I take number 2.

let me ask one more question here, do you really think our pilots would ever stay non-union? And for those who have responded already, if they didn't stay non-union but the rest of the airline did, would you guys still support us?

ual 777 contrail

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