aa777flyer
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UA Asks For More Time (Again)

Tue Jun 07, 2005 12:35 am

United Airlines has asked the bankruptcy judge for another extention till Sept to file a plan to exit bankruptcy. UA still plans to exit bankruptcy in Sept.
IMHO I think this will be the last extention and they will exit as planned in the fall.
The TSA was created to make the post office look efficient!
 
luv2fly
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 12:40 am

And I believe everytime I buy a lotto ticket that I am going to win the big pay off, has not happened yet though I keep trying.
You can cut the irony with a knife
 
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EA CO AS
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 1:48 am

Bankruptcy judges tend to romanticize airlines, and their role in "saving" them in particular. They tend to take on a, "I simply MUST save this airline, no matter what the costs!" mentality - and consequently, logic and reason fly right out the window.

They view themselves as heroic saviors, and as such they're hell-bent on bending over backwards to give the airline every possible break, rather than doing their job which is to fairly balance the needs of the company vs. those of the creditors.

So UA will continue to get extension upon extension, with seemingly no end in sight.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan

Comments made here are my own and are not intended to represent the official position of Alaska Air Group
 
StevenUhl777
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 1:55 am

Quoting Aa777flyer (Thread starter):
United Airlines has asked the bankruptcy judge for another extention till Sept to file a plan to exit bankruptcy. UA still plans to exit bankruptcy in Sept

From what I read on other news sources, there are no other creditor groups that have submitted a competing plan, so absent of that, there's no compelling reason for the Judge to cut UA off and listen to other plans. The fact no other group has put anything together to compete against UA management tells the a.) no one else is stupid enough to try or b.) the creditor groups are happy for now that UA management is doing what it can in a tough environment and believes it can in fact reemerge sometime in the next few months.

Exit in September...that's the first time I've seen where an actual month has been mentioned, I kept hearing "Fall" which could mean Sept., Oct., or even Nov. Depends on oil prices, I think, and they're going up today last I checked, above $55 a barrell.
And the winner for best actress is....REESE WITHERSPOON for 'Walk the Line'!!!!!!!!
 
ouboy79
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 2:41 am

Is this period extension for the exclusive period for UAL to submit its own plan before others? If thats the case - then there will still be the 30-day period to allow competing bids. I would be shocked if some bids for assets didn't come up - namely LHR slots.
 
USairways16BWI
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 2:56 am

does any of this remind you of another airline? for me it does. i think UA is going down the same path that US is on.

Quoting EA CO AS (Reply 2):
So UA will continue to get extension upon extension, with seemingly no end in sight.

sad..but true.
 
jmc1975
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 3:05 am

But at least they're going to have Wifi!
.......
 
luv2fly
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 3:11 am

Quoting Jmc1975 (Reply 6):
ut at least they're going to have Wifi!

Let's hope those planes do not get Repo'd!
You can cut the irony with a knife
 
FA4UA
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 4:04 am

Perspective:

1. Management has been saying emerging in Fall for months... this is not a suprise to see another extension till September.

2. Call it Repo, call it returned to lessor, call it whatever you like. At the end of the day the rates on those 763's was ABOVE MARKET RATES, so what prudent business would continue paying those rates? What business savvy management team not fight for better, more realistic payment amounts? Sounds like a decent move no matter how you frame it.

3. Adding WiFi will be done by Verizon, therefore the cost UA will be spending will likely not equal that of paying for an aircraft as mentioned above. Let's not get too dramatic folks. Plus, by adding this highly sought after technology, it will generate lots of new revenue for UA.

FA4UA
The debate continues... Starwood or Hyatt... which is better
 
alphascan
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 4:25 am

Quoting FA4UA (Reply 8):
Call it Repo, call it returned to lessor, call it whatever you like. At the end of the day the rates on those 763's was ABOVE MARKET RATES, so what prudent business would continue paying those rates?

Its hard to understand why the lessors wouldn't make a deal with UA IF they couldn't get a better deal elsewhere...or are they just United bashers too?

General sentiment on the street is that UA needed those aircraft especially with the new emphsis on international service. Fat chance of replacing any of them until they emerge from Chapter 11.

Losing those aircraft was a management error no matter how you look at it.
"To he who only has a hammer in his toolbelt, every problem looks like a nail."
 
ckfred
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 5:28 am

A corporation can stay in bankruptcy for as long as the creditors will not object.

Obviously, UA's creditors think they will get more if UA successfully exits Chapter 11, rather than convert the petition to Chapter 7 and start to liquidate assets.

Also, the fact that no serious bids exist for a competing group to take over UA means that the judge doesn't need to push the petitioner to file a reorg. plan.

My only surprise is that many federal judges pushes cases, because they like to keep their dockets as short as possible. Considering the number of times that this matter has come up for hearings, motions, and status calls, one would think Judge Wedoff would be pushing, just to get this matter closed and off his docket.
 
DAYflyer
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 5:39 am

They are riding it out for all it is worth, and they need it if they plan to survive.
One Nation Under God
 
AA7573E
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 5:52 am

It's amazing how much FA4UA always sees the bright side of things...almost like he is brainwashed. Any perspective on UA's impotence in bankruptcy offered by FA4UA should be taken with a huge grain of salt.

Anyone who thinks that losing those 763's was anything short of abhorrent management, and shortsided wishful thinking is a either a simpleton, an employee of united, or both.

The airline is a case study for mismanagement and the blatant abuse of the bk process. But adding wi-fi is clearly the way out of bk, take it from the CEO of UAL...that's a safe bet, I mean he and his board have never been known to make a bad bet in the past two years...have they?

Go out of business already, or get out of bk and join the real market playing field like 90% of the airline world. Nice job UAL. Well done.
See you up front!
 
galapagapop
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 6:06 am

Quoting EA CO AS (Reply 2):
Bankruptcy judges tend to romanticize airlines, and their role in "saving" them in particular. They tend to take on a, "I simply MUST save this airline, no matter what the costs!" mentality - and consequently, logic and reason fly right out the window.

They view themselves as heroic saviors, and as such they're hell-bent on bending over backwards to give the airline every possible break, rather than doing their job which is to fairly balance the needs of the company vs. those of the creditors.

So UA will continue to get extension upon extension, with seemingly no end in sight.

Little do they know they are hurting other viable operations by letting a bloated slow reacting major take unnecessary and unfair cuts. Hope when this is all over and UA finally get liquidated or something, someone looks at this guys record on this case and boots him.
 
FriendlySkies
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 6:11 am

You guys don't get it, do you? We live in a capitalist economy. Nobody gives a damn about anyone but themselves. Sad, but true. Judge Wedoff is there to do one thing and one thing only: to protect the interests of the creditors while giving UA a chance to fix it's problems. Until the creditors decide that they are better off without UA, UA will not go anywhere. Unless UA decides it doesn't need Wedoff anymore, and the creditors agree. So stop with the "let UA die, Wedoff sucks" crap, because Wedoff is only doing his job. If you want to blame something, blame the guys who decided the US should be based on capitalism, not the people acting on it.
 
UA744Flagship
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 6:54 am

Read Ckfred's post. It should open your eyes, unless you're a simpleton.

Bankruptcy is no cakewalk. Why do you think DL has struggled so much to avoid it?

Bankruptcy is not desirable. The only thing it does is give you more leverage in negioting cuts in everything - from leases to wages. And sometimes, you actually get less leverage - in the case of UA's lease renegotiations for 767s. Other than that you are at the mercy of your creditors. If creditors felt that UA was staying in BK too long, then they would not keep extending the POR deadline. You wanna change that? Then become a creditor, idiot.

In BK, it isn't just the company that can renegotiate a lease or contract payment -- it is a creditor as well.

That is why many times companies coming out of bankruptcy actually end up paying more for assets than before. That is precisely what happened to TWA - when it emerged from BK#1 it was saddled with high airplane leases. When it did BK#2 (acquired by AA) AA was able to negotiate lease rates down, or reject them. It all depends on the market for those assets. And in BK#1 for TWA, the market for planes was high; in BK#2 the market was low. No big surprise that lessors were able to get more for plane lease after BK#1, and AA was able to pay less after BK#2.

Bankrupcty is not desirable and to stay in it longer is not abusing the process -- staying in it longer just dashes the hopes of those who have an interest in seeing the company liquidated. CAPICHE??

Quoting AA7573E (Reply 12):
It's amazing how much FA4UA always sees the bright side of things...almost like he is brainwashed. Any perspective on UA's impotence in bankruptcy offered by FA4UA should be taken with a huge grain of salt.

Anyone who thinks that losing those 763's was anything short of abhorrent management, and shortsided wishful thinking is a either a simpleton, an employee of united, or both.

The airline is a case study for mismanagement and the blatant abuse of the bk process. But adding wi-fi is clearly the way out of bk, take it from the CEO of UAL...that's a safe bet, I mean he and his board have never been known to make a bad bet in the past two years...have they?

Go out of business already, or get out of bk and join the real market playing field like 90% of the airline world. Nice job UAL. Well done.
no wire hangers!
 
StevenUhl777
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 6:55 am

Quoting AA7573E (Reply 12):
It's amazing how much FA4UA always sees the bright side of things...

United needs a LOT more employees like FA4UA...optimistic, ones who care and want to see the company succeed. It's also helpful to have an inside perspective to counter all the anti-UA bashing that goes on.

Quoting AA7573E (Reply 12):
Any perspective on UA's impotence in bankruptcy offered by FA4UA should be taken with a huge grain of salt.

So we should instead listen to you, who works for UA's primary competitor?

I'll stick with FA4UA for the foreseeable future.  Wink
And the winner for best actress is....REESE WITHERSPOON for 'Walk the Line'!!!!!!!!
 
mcdu
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 6:58 am

The exclusivity period is not for asset bids. The exclusivity period is for competing bids in the reorganization. Today request is nothing other than the contium of the CH11 process. A literal check mark on the road to exit. UA makes its case in court to the judge with the labor packages, financing and the target of Oct exit. The naysayers here have been putting this company down for quite sometime and it is going to be an excellent breath of fresh air when we exit in OCT and watch the rest of you guys (AA,CO,DL and NW) struggle with the changing marketplace. UAL has made the difficult moves to ascertain the longevity of the corporation.
 
LAXintl
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:04 am

Quoting Ouboy79 (Reply 4):
I would be shocked if some bids for assets didn't come up - namely LHR slots.

A couple unused slots were quietly sold a few weeks back to Jet Airways of India. UA in the past few years has strategically sold/auctioned off unneeded slots at LHR.
You might remember UA up to recent years offered services from LHR to BOS, EWR and inter European flying to BRU and AMS. The two European flights were primarily to keep the LHR slots occupied.
From the desert to the sea, to all of Southern California
 
avek00
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:07 am

Quoting FA4UA (Reply 8):
At the end of the day the rates on those 763's was ABOVE MARKET RATES, so what prudent business would continue paying those rates?

What prudent business would not try to protect itself from a high risk of default by charging exorbitant rates or imposing onerous terms upon a financially shaky firm? When CO, TW, and HP filed for bankruptcy, all of them emerged with horrific lease/financing terms (to this day, CO still pays through the nose for its 735 and some 733 leases because of its previous BKs). United will be no exception to this - even if the company emerges with decent leases/financing terms, it will be a LONG time before the airline will be able to acquire new planes or float bonds on attractive terms, as the financiers willing to work with the airline while in BK run for the hills and cover themselves post-BK.
Live life to the fullest.
 
AA7573E
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:18 am

Nice try UAL744 Flagship.

You can make all the excuses you want for UAL coming out of bk...and the TWA example, although true, does not apply to UAL. The industry is so much more transparent now than it was then, and the negative arbitrage they attained in bk is much harder to come by these days, unless of course you are run by fools..which certainly may apply to UAL.

UAL has been renogotiating, and re renegotiating leases since day 1 of this bk. I have personal exposure to their continual renegotiation of leases, and it simply never ends. As soon as the ink is dry on one new lease, they put it up for renegotiation.

I will give you that being in bk is no picnic, but neither is operating in the real world, where leases, agreements, contracts, and operating covenants can not be changed so easily, and you are forced to adapt and survive. Asking for extensions every quarter is a shameless abuse of the process. End of story.
See you up front!
 
avek00
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:27 am

Quoting AA7573E (Reply 20):
As soon as the ink is dry on one new lease, they put it up for renegotiation.

Remember, the more the creditors bend over in bankruptcy, the faster they will run away from United if/when the reorganized company wants to buy a new 787/350/744ADV/380 or float an unsecured bond.
Live life to the fullest.
 
commavia
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:34 am

Quoting Mcdu (Reply 17):
The naysayers here have been putting this company down for quite sometime and it is going to be an excellent breath of fresh air when we exit in OCT and watch the rest of you guys (AA,CO,DL and NW) struggle with the changing marketplace.

I'll give you NW and DL, but I would say don't hold your breath on watching AA or CO "struggle" vis a vis UA. AA was one of only three major airlines in the entire United States to make an operating profit in Q1 (the others being WN and B6, not a bad group to be in) and CO showed enormous revenue strength with its May financial numbers. If -- and I say "if" only because we have been watching this date get pushed back and back for three years -- UA emerges from BK in October, then they no doubt will be a leaner airline but will still face the same challenges as everyone else and, IMHO, be no better positioned than AA and CO to meet those challenges.
 
avek00
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:43 am

Quoting Commavia (Reply 22):
IMHO, be no better positioned than AA and CO to meet those challenges.

UA will be in an inferior position - unless negotiated as part of BK emergence (and in fairness, Airbus is practically giving away A350s to non-existent airlines, 2/3rds of whose parents are badly bankrupt), UA won't be getting new planes or new financing for a long-time post-restructuring.
Live life to the fullest.
 
UA744Flagship
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:43 am

Quoting AA7573E (Reply 20):
UAL has been renogotiating, and re renegotiating leases since day 1 of this bk. I have personal exposure to their continual renegotiation of leases, and it simply never ends. As soon as the ink is dry on one new lease, they put it up for renegotiation.

Hmm, this is actually an interesting and disturbing point. I hope we're not spending a dollar to save a penny here... I guess the lawyers aren't playing as successful a hardball as the company is paying them to?
no wire hangers!
 
baw716
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 7:52 am

I hope the judge only gives them the extension and that they blow it.

Reasoning: From my perspective, I will be finished with the plan I am writing by the end of June. Then I have to take it and sell it to the individuals necessary who have to be the ones who back it to take in to the bankers necessary to get the buy in to provide the financing. I anticipate all of that taking the balance of the summer. Once that is really, if by a miracle, everyone agrees, we will be ready to go forward by September. If not, then plan b goes into effect at which time, I will ready to present with plan b by September 1.

I will also have a couple of analysts review my plan prior to submitting it to UAL (sanity check for reality...to make sure that my numbers are believable).

So let's hope. If this works, a.netters will be part of a unique story in the history of aviation...or the most crazy thing you ever have seen. I'm willing to take that risk.

baw716
David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
 
avek00
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 8:02 am

Quoting UA744Flagship (Reply 24):
I guess the lawyers aren't playing as successful a hardball as the company is paying them to?

The United lawyers ARE playing hardball, but it only goes so far - many of United's pieces possess just enough value for its creditors to draw lines in the sand. The 763ER repo is a good example of this - UA wanted to make even deeper cuts on the leases, and the lessors balked and took the planes back for re-marketing.
Live life to the fullest.
 
baw716
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 8:22 am

Once again, the mgmt of UA is thinking they can lease a 767 for the price of a 737. It just doesnt work that way. If the creditor has a customer for the 767 lined up and it can make more on that lease than what they are getting from UA (which is probably the case), then the lessor will just say, pay up or else. The UA lawyers tell the lessor to get real and that if they are not careful, then UA will take its lease business somewhere else. At which point the lessor says to United, "fine, we don't need your business, take a hike. Please return our aircraft here by this date, thank you very much." Now depending upon who the lessor is, that could be a real problem for United, since they cannot afford to lose too many aircraft by tellling their leaseholders to pound salt. The bigger problem is, now when they go to renegotiate the lease on some other aircraft held by the same lessor, now that they have pissed off the lessor, there is no incentive on the part of the lessor to help United. Their response will be pay up, or return the aircraft. This isn't a good position to be in if you are trying to work through a bankruptcy and run an airline.

This is just another example of the arrogance and stupidity of the management of United. They just don't get it.

baw716
David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
 
jetclipper747
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 8:51 am

Quoting UsAirways16bwi (Reply 5):

does any of this remind you of another airline? for me it does. i think UA is going down the same path that US is on.

Actually it does not. US went in and out twice. Tilten said he's only going to come out once when we're ready to stay out.
I love this. You armchair "aviation experts" can't wait for the demise of UA. Guess what: ain't gonna happen. Labor is taken care of. Leases are continuously renegoitiated to get the best rate. (Oh, you can keep refinancing your mortgate but an airline can't try to lock in lower lease rates?)
UA is the leanest in it's history( more so than any other legacy carrier)
I love reading the "serious" comments and opinons posted here. It reminds me of the fights to the death in high school over who makes a better model; Revell or Monogram.
I know what my problem is; I took this to be a serious professional discussion.
This is why I don't listen to talk radio anymore.
By the way - microsoft flight simulator time is not the same as real stick time. Why would some of you list computer sim time? Life's too short! Get out of the house and fly the real thing!

[Edited 2005-06-07 02:07:13]
Sometimes a banana is just a banana.
 
avek00
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 9:36 am

Quoting Baw716 (Reply 27):
They just don't get it.

They "get it", there is just nothing they can do about "it" - United NEEDED to avoid BK like the plague, because the alternative was a slow, painful, rotting demise.
Live life to the fullest.
 
B744F
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 10:01 am

Big corporations get the socialism treatment, everybody else gets the free market capitalism treatment. How ironic. As usual, the real winners are the executives and creditors and the losers are always the employees
 
LAXintl
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 10:01 am

Quoting Baw716 (Reply 27):
Once again, the mgmt of UA is thinking they can lease a 767 for the price of a 737. It just doesnt work that way.

Sure it does. UA has done a wonderful job in driving significant concessions on the price of its leased aircraft. Its B744s for instance are now leasing close to the price of what some the recently returned B763s were leased for.
Being a large airline, UA can reasonably expect to pay atleast the going market rate, if not a discount as compared to the many pre 9/11 inflated long term leases its sitting on.
Sure some companies are no longer care to play ball with United, however most are willing to accommodate the carrier as they do not want a flood of aircraft back and smartly would like to maintain a business relationship with one of the worlds largest airlines.
From the desert to the sea, to all of Southern California
 
ContnlEliteCMH
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 10:29 am

Quoting Mcdu (Reply 17):
The naysayers here have been putting this company down for quite sometime and it is going to be an excellent breath of fresh air when we exit in OCT and watch the rest of you guys (AA,CO,DL and NW) struggle with the changing marketplace. UAL has made the difficult moves to ascertain the longevity of the corporation.

Ah. So in your opinion, UA's emergence from Chapter 11 will signify an immediate return to profitability and general "high flying" while the rest of the majors -- including two who may actually show a profit while UA slogs toward a bankruptcy exit -- will struggle with the marketplace?

First, what is it about bankruptcy exit that you think signifies an immediate return to profitability?

Second, what makes you think CO and AA haven't already made the same changes UA has had to make in bankruptcy?

Third, just exactly what changing marketplace conditions do you think will exist in the fall that CO or AA cannot deal with (or have already dealt with), but UA can? If you haven't checked, CO's load factors are running nearly 80%. They seem to be doing something right already.

Inquiring minds want to know.

On a sidenote, on my weekly ATL-CLE on CO (you know, one of those legacies that will be sucking UA's exhaust fumes in the fall?) there was a deadheading pilot in the row in front of me, across the aisle. I think he was a UA pilot. Anyway, he had a Powerpoint printout of United's "plan" to make them a viable airline.

I wish I had written down what I was seeing, but I couldn't believe it. I will freely admit that I have a bias against people who are "all about process" and who spew business cliches. But what I was reading MUST have been written by Scott Adams, because I haven't seen such meaningless cliche on paper since I read the Dilbert books. It's so sad that huge companies are havens for people who know how to just pour out business-speak, at the expense of those who actually just get things done. Results speak the loudest! That said, words mean things, and if United can truly create a dynamic organization that satisifies the customer, they (too) can truly return to profitability. Maybe they should ask CO and/or AA what that's all about, because I think both of those airlines are going to beat UA to the profitability punch.

I *so* eagerly await one of the legacies to return to profitability, just to destroy this notion that "they're all in the same sinking boat" and "the changing marketplace" precludes profit. It's like people who *still* complain about the U.S. economy. My gosh. 5.1% unemployment (5% is considered full employment). Near-record low interest rates. Profitability everywhere (except in airlines, it seems). People are always laggards. About the time they figure that the economy is good, it'll do its normal thing and flop toward recession.
Christianity. Islam. Hinduism. Anthropogenic Global Warming. All are matters of faith!
 
rsmith6621a
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 11:43 am

Quoting Aa777flyer (Thread starter):
United Airlines has asked the bankruptcy judge for another extention till Sept to file a plan to exit bankruptcy. UA still plans to exit bankruptcy in Sept.
IMHO I think this will be the last extention and they will exit as planned in the fall.

This will give UAL more time to plan another great robbery of their employees.
Did You Ever Think Freedom Could Be this Bad
 
mattnrsa
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 12:17 pm

Those who think UA has been in bankruptcy for too long are all forgetting that HA just exited bankruptcy last week after spending 2 1/2 years under bankruptcy protection. I think if a company of UA's size can complete their proceedings in only several months more than HA, then they're doing a pretty good job.
 
scotron11
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RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 3:08 pm

The figure I've seen on UAL leases is $900M they want to renegotiate. Come one folks, last year it was all about getting rid of the pensions, done; along with more concessions from employees, done.

The sneaky thing they tried to get away with by arguing that lessors threatening to repo 14 aircraft violated antitrust laws, and Wedoff went along with by issuing a temporary restraining order, which should shed a little light on his leanings in this case, were shot down by the Appeals court as "thin to the point of invisibility."

Not only that, it went to the heart of DIP financing. By denying a DIP lender their right to repossess their assets, it threatened the whole industry by putting those assets at risk. In normal cases, and I think we have seen this case is certainly not normal, both parties come to agreement. Why UAL and these creditors haven't been able to is puzzling.

It is also perplexing that after all the decisions that have gone their way, they still need until September to file a reorganization plan, especially saying for months they will exit this thing in the "fall". Is that a fateful term?
 
ckfred
Posts: 4694
Joined: Wed Apr 25, 2001 12:50 pm

RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 11:14 pm

Mcdu:

There are a number of airline analysts who believe, absent oil going below $40 a barrel in the next few months (which is still possible), that CO, DL, and NW will be looking at shortages of cash come Q1 of '06.

On the other hand, analysts feel that AA is in a very good position, with $3.5 billion in cash on hand. It appears to be the legacy carrier that will survive.
 
Braniff727
Posts: 656
Joined: Sat Sep 23, 2000 2:25 am

RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 11:38 pm

Quoting FriendlySkies (Reply 14):
We live in a capitalist economy.

And exactly how is it capitalistic to have the government allow UAL to abuse Bankruptcy Law for nearly 3 years? How capitalistic is it that UAL has US Government's "thumbs up" to operate by selling tickets for way less than it costs them, causing other airlines to have to do the same to compete?

In a true, capitalistic market, UAL would have been devoured and shut down by the healthier airlines.

The ONLY reason that other airlines are hurting now is because UAL and US have been keeping airfare artificially low because they are protected under Chapter 11.
Climbing
 
uadc8contrail
Posts: 1636
Joined: Thu Sep 11, 2003 1:23 am

RE: UA Asks For More Time (Again)

Tue Jun 07, 2005 11:58 pm

Braniff727
"And exactly how is it capitalistic to have the government allow UAL to abuse Bankruptcy Law for nearly 3 years? How capitalistic is it that UAL has US Government's "thumbs up" to operate by selling tickets for way less than it costs them, causing other airlines to have to do the same to compete?"

So United was the one to introduce those low fares($44.00 o/w) on the IAD-LAS/SAN/LAX/SJC flights???? to force indy out of biz,INDY introduced those fares...did ual start the $29.00 ow from lan to iad and then indy and nwa matched???. ual has-not-instituted all the low fares as you have stated..they matched them.

"In a true, capitalistic market, UAL would have been devoured and shut down by the healthier airlines."

I guess using your logic on bk airlines...HA,HP,AQ should have gone by the way side along time ago right????

"The ONLY reason that other airlines are hurting now is because UAL and US have been keeping airfare artificially low because they are protected under Chapter 11.

Again,,,would you say that HPs 3 yr ride in bk should have forced them out of biz as well?????how long was HA in bk court?????
bus driver.......move that bus:)
 
Tango-Bravo
Posts: 2887
Joined: Sun Jun 17, 2001 1:04 am

RE: UA Asks For More Time (Again)

Wed Jun 08, 2005 1:55 am

Quoting FA4UA (Reply 8):
Call it Repo, call it returned to lessor, call it whatever you like. At the end of the day the rates on those 763's was ABOVE MARKET RATES, so what prudent business would continue paying those rates?

Nice try... Why then does it seem that the lessors have had no problems in re-marketing the same aircraft for which UA (supposedly) refused to pay "above market" rates?
 
airfrnt
Posts: 1993
Joined: Fri Jul 02, 2004 2:05 am

RE: UA Asks For More Time (Again)

Wed Jun 08, 2005 2:23 am

Quoting B744F (Reply 30):
Big corporations get the socialism treatment, everybody else gets the free market capitalism treatment. How ironic. As usual, the real winners are the executives and creditors and the losers are always the employees

That's not true. I worked for a small company that went thru BK court. The proccess, including the continual postponment of the re-org plan occured exactly like it is occuring for UA.
 
baw716
Posts: 1459
Joined: Thu Nov 20, 2003 7:02 pm

RE: UA Asks For More Time (Again)

Wed Jun 08, 2005 2:38 am

Tango Bravo,
I agree with you. This whole business of UA paying above market rates is a load of crap. I have been involved now for the past six months in selling and leasing of aircraft and I have a pretty good feel for exactly what UA has been paying for the leases, since the aircraft I have been selling and leasing have been ex UA aircraft. The 763s that were taken back had deals on them already when they were taken back at market rates. Why would these other carriers pay these rates when UA would not? There are a lot of 767s on the market right now, so the lease rates for 767s tend to be on the low side anyway. It is a little puzzling for me to understand how United can bitch about lease rates when the lease rates in the market are already fairly low, based on the average value of the aircraft? I don't buy UAs argument.

The fact that UA returned those 767s is fact that UA management flat does not know what they are doing. They were already paying market rate on those birds and they wanted to pay less? In point of fact, I suspect they tried to leverage the lessor by using the bankruptcy process to negotiate a better deal on those leases and the lessors said no (they can't take a loss on their leases), so at some point, the lessors started an action to get the birds back. Ultimately they were successful.

This is an example of what I am been saying all along about United. Their reorganization plan has been all about cost cutting. It has not been about changing their business to be leaner, to be more realistic about the realities of the marketplace, to focus on other market segments other than the business traveler. Their answer is that they have TED. TED is a joke. TED is going to cost more to operate and give the leisure customer nothing that they can't get anywhere else...and United will lose money operating it, because they can never achieve the costs necesssary to make it profitable.

United's current management team is just flat incompetent. The sooner everyone recognizes that that needs to happen and that they are removed and another group put in that KNOWS what to do, the better off United will be, and SOONER than later, before the creditors run out of patience with the situation.

baw716
David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
 
B744F
Posts: 2927
Joined: Sat Jan 21, 2006 4:52 pm

RE: UA Asks For More Time (Again)

Wed Jun 08, 2005 4:36 am

Quoting AirFrnt (Reply 40):
That's not true. I worked for a small company that went thru BK court. The proccess, including the continual postponment of the re-org plan occured exactly like it is occuring for UA.

On favorable terms? And try going through the same BK process if you are an individual. Also, did your company get government welfare checks constantly while complaining about the economic situations?

[Edited 2005-06-07 21:37:33]

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