Posts: 133
Joined: Sun Feb 25, 2001 9:04 am

United Sinking?

Thu Jun 21, 2001 4:50 am

Hey Everyone:

There is a lot of talk at PlaneBusiness about United being added to the "Titanic List". Sounds pretty bad for United Sad I love United and hope to God that they are able to turn this ship around. I am doing an internship at United this fall, as a prelude to employment there. I am so nervous about how things have been going. If they post more than a $350 million dollars loss this quarter, how much longer can they go?

Is this due to American? Is it due to managment? When will Goodwin get the boot? Is the end near?

Let us all (even those who hate United) hope that this is just hype.

Anyone have more info on what to expect from United (financially or otherwise?)

RE: United Sinking?

Thu Jun 21, 2001 5:00 am

Don't be suprised to see Delta in the same position soon, thanks to their mainline/comair pilots and lower profits.

Overview 25-APR-01

On a stand-alone basis, UAL's revenues could increase 5% to 7% in 2001, versus 2000's gain of 7.4%. Traffic will decline slightly, as the impact of labor disputes, capacity reductions and lost business accounts will hurt results (lost revenue in the 2000 fourth quarter as a result of labor problems totaled $200 million). Operating margins will narrow, as sharply higher salary and wage expenses and fuel costs will outweigh the benefits of lower commission charges. In addition, subject to regulatory approval, the company will have substantial integration costs associated with its US Air acquisition. The Justice Department is expected to issue a ruling on the proposal during the second quarter of 2001. United is unhedged for fuel in 2001, as it believes prices have leveled off. As a result of weak travel demand and escalating costs, we are projecting a 2001 loss per share of $3.50.

Valuation 25-APR-01

The shares have fallen sharply since the company's announcement of an offer to purchase US Airways in May 2000. UAL's stock has also been affected by higher fuel costs, ongoing capacity reductions, labor problems, and customer defections. We believe a turnaround scenario will not emerge until at least the second half of 2001. In addition to these concerns, EPS will be affected by higher maintenance expenses. Although the stock is attractively priced, with price to sales and price to EBITDA ratios below those of peers, there are too many clouds on the horizon: the potentially dilutive acquisition of US Airways, lost consumer confidence, capacity constraints, and high fuel costs. As a result, in January 2001, we downgraded the shares to avoid, from hold.


RE: United Sinking?

Thu Jun 21, 2001 5:11 am

I can tell you why I rarely fly UA anymore: Ever since CO left town (I'm referring to DEN), UA dramatically increased fares and the quality of service gradually declined to the low point last summer.
UA had the best service around in the 80's and early 90's. That was the main reason my family chose UA instead of CO. But once UA had the market for themselves, they decided to abuse the loyalty of their customers. In my opinion, UA's current downfall is directly related to this.
Hopefully through this downfall UA will notice the errors of their ways, but until then I will continue to support other airlines even if it means extra connections.
Matt D
Posts: 8907
Joined: Fri Nov 19, 1999 6:00 am

RE: United Stinking?

Thu Jun 21, 2001 5:16 am

Check out

it's pretty hard to feel sorry for an airline that kicks itself in its own ass due to blinding arrogance.

United better take some pretty drastic measures, and soon. Either they do us all a favor and shut down, or do us all a favor and get their schidt together.

Either way it doesn't matter to me, but the sooner, the better.
Posts: 319
Joined: Wed May 30, 2001 9:06 am

RE: United Sinking?

Thu Jun 21, 2001 5:27 am

It's definitely sinking. Goodwin, Studdert and the rest of the inept management have got to go.

Is UA going follow the Pan Am, Eastern, Braniff routes? Probably not, but there's going to be a lot of pain until they can get themselves focused.

And I don't think they'll get focused until they get new management. The reason being that current management is intentionally creating all sorts of distractions (US merger, the new Bizjets venture,, and on and on) in their vain hope that people won't notice they're running one of our great air lines into the ground.
Tan Flyr
Posts: 1618
Joined: Sat Aug 19, 2000 11:07 pm

RE: United Sinking?

Thu Jun 21, 2001 5:43 am

AS 767-322ETOPS stated, no way is UAL going to go out of business..Lots of assets around to sell if ever needed. What is needed, by them, and all airlines , is a better focus of the pax and our needs. Even the occasional vacationer deserves to be treated with dignity & respect.

Those of us that fly a lot, and pay the employees wages are tired of the same old shxx from most carriers. Some days are better than others.Some carriers are better than others.

UAL needs to focus on running a quality airline.Like it was in the 70's and early 80's. Ever since ALLEGIS Corp, and the ensuing crap, it has been slowly downhill.

Wake up UA, the bottom of the slope is dead ahead.
Posts: 2668
Joined: Sat Jan 13, 2001 6:25 am

RE: United Sinking?

Thu Jun 21, 2001 7:25 am

Both of Delta's pilot situations are solved. Delta is doing fine!!!!! Bigo747, WHAT A LYING BLOKE!!!!!!!

RE: United Sinking?

Thu Jun 21, 2001 8:09 am


Delta faces:

-Incresed Wage expense
-Huge losses due to Comair
-Increased fuel cost
-Lower passenger counts, mainly high paying biz ones
-Smaller cabins with less perks compaired to AA and UA
-Demoralized workforce, especially in Comair, and soon ASA
Posts: 590
Joined: Wed Sep 20, 2000 12:17 pm

RE: United Sinking?

Thu Jun 21, 2001 8:13 am

maybe for the hope of American Airlines... but not at all... I agree they have to change their way of doing arrogant business as fast as they can, but United is a great airline!!!!

Posts: 676
Joined: Sat Apr 28, 2001 1:48 am

RE: United Sinking?

Thu Jun 21, 2001 8:15 am

SESGDL, don't forget about DL's "industry killing" pay contracts... their costs will now be even more than United's.

There's definitely a slippery slope United's been tumbling down... it's not a good sign when posts frequently come about asking when the madness will end. It's true that UAL needs to focus on its core assets. The crippling pilot strike of 1986 along with much-maligned Allegis changed the culture for the worse with huge ramifications. There is no unity among employee groups and management.

United is far from bankruptcy, but at the rate of losing at least another $350m this quarter, growth and the airline's ability to compete will be crippled.

It's no surprise that UAL will be the next on Holly Hegeman's Titanic Watch given the staggering losses, fog-thick bad PR, and stock underperformance.

Ampropilot2b, I'm starting an internship with UAL within the next few weeks, but I'm not worried. I just have to keep my head up, hoping for the best, doing as best I can, with aspirations of being able to significantly contribute to a positive change in this airline later.

E-mail or IM me about your UAL internship later, I'd love to talk about the program. And as always, head up young person!
Posts: 900
Joined: Tue Sep 05, 2000 2:54 am

RE: United Sinking?

Thu Jun 21, 2001 8:24 am

No one should take too much stock into that "" slam-site. That place seems to have a lot of misguided, infrequent fliers with poor writing skills that just wanna vent.

However, what IS clear to everyone now is that United is a runaway bus without a driver. And the 300 ft. cliff is just a few miles down the road. I don't think the company is going to recover as quickly as it faltered. The damage seems to still be ongoing without management really comprehending how they're STILL *fucqing* up.

...And to top it off, UA agreed to pay US Airways $50 million if the deal *doesn't* go through (which, at this point, it won't). That's right, ****$50,000,000**** to US Airways if the acquisition doesn't happen. Gee. --I wonder who thought of that 'lil mind-blowing, fiscally-responsible game plan?

Now, with all of the red ink and financial bloodshed, they almost overnight, decide to go out and purchase a bunch of business jets. I doubt they researched this as thoroughly as a NORMAL large carrier would. From what I hear, many of the employees of United are thoroughly pissed off and rightly embarrassed at the atrocious mis-guidance of their company. I know I would be.

I hope Goodwin and Dutta get a nice severence package when they get booted out soon (which, at this point, is basically guaranteed) . The severity of incompetence from the "leaders" of United is shocking. It's even jaw-dropping. You'd expect this type of folly and sheer cluelessness from a lowfare, small upstart carrier. But not from one of the world's largest!

And folks, I don't think blaming the pilots' raise for the current predicament is accurate. Why? Because a *good* management team would have rectified any contract disputes BEFORE the pilot's threats to slowdown became real. I doubt Crandall, Carty, Mullin, Dasburg, or even Wolfe himself woulda ignored the pilot's labor action for three days, much less AN ENTIRE SUMMER!!! With all the flight cancellations in the first week that summer, it shoulda been well apparent to Goodwin that those pilots meant business. This is regardless of whether the pilots were being "greedy," "unrealistic," or plain wrong. They should have at least *tried* to work out SOMETHING at the eleventh hour, especially since the pilot's union had been actively telling management about contract issues months BEFORE to the slowdown. Gosh! What dumbasses!!!

I feel sorry for UA's "employee" owners. They shoulda gotten rid of those boys at the top months ago.

Yes United is ALREADY on the TWA/Pan Am/Eastern flight plan. Tragic.

Posts: 676
Joined: Sat Apr 28, 2001 1:48 am

RE: United Sinking?

Thu Jun 21, 2001 8:30 am

Hold on there-- the sky is not falling quite yet.

The BizJet outfit was actually researched for over two years. It's just that the timing of this execution is, well, untimely. Just like the merger with US Airways, which itself was in the clockwork for 9 months, it was horrible timing. UAL needs some pro who can really understand the economic, political, and media climate!
Posts: 8777
Joined: Thu May 30, 2002 6:54 am

RE: United Sinking?

Thu Jun 21, 2001 8:47 am

Yeah. UA rules.

No. UA sucks.

Lawd... I love the great discussions we have here!  Smile
"The A340-300 may boast a long range, but the A340 is underpowered" -- Robert Milton, CEO - Air Canada
Posts: 2616
Joined: Mon Jan 17, 2000 4:22 am

RE: United Sinking?

Thu Jun 21, 2001 10:37 am


Wholeheartedly agree......
Posts: 293
Joined: Sun Jun 17, 2001 1:25 am

RE: United Sinking?

Thu Jun 21, 2001 11:17 am

Disheartening- not one shred of objective information in this whole thread. I fly United from/to Denver every week. On time performance for me has been nearly 100% for the last 8-9 months, save one flight from SFO. Their people have been courteous, and you gotta love economy plus. United's safety record has been excellent, and the fares comparable to the competetion. What more do you people want!!!???

Now if they only offered free drinks in the Red Carpet Club...
Posts: 862
Joined: Mon Oct 16, 2000 8:19 am

RE: United Sinking?

Thu Jun 21, 2001 11:22 am

I dont usually slam people straight out, however BA-747, you are a complete and total idiot.

That being said, UAL is definitely suffering. I am watching my stock struggle to keep above $30. I think that if UAL can get someone that actually understands the airline industry in the leadership, then it can be righted. Gordon Bethune did an amazing job with Continental, and I hope that someone can come in and do even half of what he did for United.

Not only am I a stockholder, but my fiance is an employee, and a significant portion of our income depends on the well being of this organization. One of the things that would do the airline well is for the F/As to kick out the AFA, and become and independent union unto themselves. Sorry, that is irrelevant, but how I feel. There is a lot of labor strife, and an us vs. them mentality among the employee groups, as well as between employees and management. The unions foster both of these. If they somehow grasped the concept of doing things for the mutual good of the company and the employees, this company could be number one yet again.
A woman drove me to drink and I didn't have the decency to thank her. - W.C. Fields
Posts: 3224
Joined: Sun Aug 27, 2000 7:16 am

RE: United Sinking?

Thu Jun 21, 2001 11:38 am

I'd like to remind people of some things.

#1. UAL is a corporation with vested interests in other sectors.

#2. United Air Lines, Inc. is the airline division of UAL Corp.

#3. United Air Lines, Inc. has its own management aside of UAL Corp.

#4. United NewVentures has a totally seperate accounting and management system from United Air Lines, Inc.

#4. United BizJets has a totally seperate accounting and management system from United Air Lines, Inc. AND United NewVentures.

The best way to understand United is to look at Starwood Properties.

You have Westin Hotels and Sheraton Hotels. Each have their own payroll, their own adminstration, their own employees... but they all share the same benefits. So if one expands while the other is struggling, its not at fault of the expansion division. Same with UAL Corp. Let BizJets take off, make some money, and at least boost the UAL Corp. stock price, even if United Air Lines faulters for a bit longer.
~ ~ ~ ~ pRoFeSsIoNaL hUrRiCaNe DoDgEr ~ ~ ~ ~

RE: United Sinking?

Thu Jun 21, 2001 11:58 am

I don't want to see ANY airline go under. Management at UA is inept. AA outfoxed them completely by acquiring TW, promising to take some of US off thier hands to "satisfy" DOT, then backed off. AA has leadership and employees, UA lacks the former. UA employees are among the best in the industry and THEY deserve more than the morons they have running it.
UAL Bagsmasher
Posts: 1839
Joined: Wed Sep 08, 1999 12:52 pm

RE: United Stinking?

Thu Jun 21, 2001 12:11 pm

Ok...For all the Matt D's out there....You try busting your ass day in and day out at an airline and see how you like it when someone tells you they hope your company goes under. Stop talking through your a**.
Posts: 843
Joined: Wed Aug 30, 2000 8:10 pm

RE: United Sinking?

Thu Jun 21, 2001 12:14 pm

Great post there BA 747, really informative and nicely put. Remember that airlines employee tens of thousands of employees that for the most part do the best job they are able too. AS for their color scheme, who cares. Saying you wish an airline would go under, cause thousands of job losses and create a huge impact on the countries economy is really childish. Sorry, but had to reply to this one.

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