Speedport From United States of America, joined Sep 2001, 284 posts, RR: 0 Posted (11 years 11 months 2 weeks 3 days 20 hours ago) and read 2807 times:
A poll conducted by Military.com/WIRED Magazine reveals that 49% of those polled, 1,672 active duty personnel and veterans, believe the war will last longer than 30 days. 30% believe it will last 2-4 weeks. 52 percent believe the post-war military occupation will last longer than 2 years.
Similarly, Business Travel Coalition compiled a survey of 123 business organizations and surmises there is a 50% chance that “virtually all U.S. commercial airlines seek reorganization in bankruptcy court; some liquidate.”
Since I do not intend this thread to become a UAL-bashing love fest, let me make a preemptive argument.
UAL, already operating in chapter 11, has the advantage over AA. UAL already has significant wage reductions, it plans to reduce wages a further 9% by mid-April, maybe sooner, it has imposed forced ANP (Authorized No Pay) on 3500 employees with more to come, it will reduce its capacity 8% by 4/1 and perhaps more, the union bluff of offering an alternate restructuring plan was called on 3/21, and the judge has cleared his calendar for the week of 4/14 to hear the 1113 motion to void the contracts. I believe the judge could rule on the motion by the end of that week clearing the way for UAL to immediately impose everything it wants, or at the very least agreement by its unions by the end of the week.
AA, conversely, has yet to announce schedule reductions, employee layoffs, or immediate wage reductions. They may well soon file chapter 11, but the changes they would need to make to match UAL would take time. They simply wouldn’t be able to “blast” the bankruptcy judge on the first day. Judges take time to render decisions to make the process look judicial. UAL already has a head start and will have all of their cuts in place as AMR just gets the ball rolling. With a prolonged war, AMR could find itself with too little, too late and proceed directly to chapter 7.
N777UA From United States of America, joined Mar 2010, 0 posts, RR: 0
Reply 1, posted (11 years 11 months 2 weeks 3 days 20 hours ago) and read 2776 times:
I doubt American would go directly to chapter 7. If things were that bad, I'd think they would at least "try out" chapter 11 in hopes that things might work. Though they're not in exactly the best financial shape, I think they'll make it.
I also believe United can make it as well. Once they impose new contracts, they will be working better, and with the 300 million + dollar tax refund, will give them much needed cash to help lessen the impact of the war.