Moderators: jsumali2, richierich, ua900, PanAm_DC10, hOMSaR

 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

UAL Rejected By Atsb

Thu Dec 05, 2002 7:43 am

CNBC just reported that the ATSB has officially rejected UAL's 1.8 Billion dollar loan guarentee application.

I'm sorry about the post that is titled "When it rains..." The whole title didn't post.
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 7:52 am

UAL shares is tanking in after hours trading because of impending bankruptcy fears. Looks like it is down over $2 to around .70 cents per share. Unbelieveable.
 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 7:56 am

 
deltairlines
Posts: 7228
Joined: Mon May 24, 1999 4:47 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 7:58 am

United Airlines...You are the weakest link, Good Bye.

Looks like UAL is heading to bankruptcy court. They are screwed now, as they have only $1B in cash right now, and $900M is due by Christmas, meaning they will only have $100M, which is not that much for a company this size.

Jeff
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:02 am

Jeff, if they file before they pay out that 900 million at least the bankruptcy judge will have more to work with.
 
Tbird
Posts: 801
Joined: Wed Oct 31, 2001 3:09 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:07 am

Greetings:

Well the fat lady has sung. This is truly a sad day for UAL, I'm sure their bankruptcy filing is only hours away. With their current financial condition I just can't see how they are going to make it. Even with DIP money they still face a huge amount of debt to pay back. At this point it wouldn't surprise me to see them close down within the next three months.

Regards
Tom
 
exusair
Posts: 658
Joined: Fri Sep 08, 2000 12:15 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:07 am

After all of the progress made in the past few weeks with the unions, was everything contingent upon the ATSB loan?

It seems like they bet the house on an iffy matter if this was the case.

Let the asset shedding begin.

LHR access, Slots in Tokyo, excess aircraft.
 
luisca
Posts: 1530
Joined: Thu Aug 16, 2001 11:37 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:13 am

Reminds me of Eastern and PANAM, their is a very good article on the colapse of PANAM in Airliners, so sad to see a giant fall, especially sad for the employes, they will certanly have a sad christmas
If it ain't Boeing (or Embraer ;-)) I ain't Going!
 
sllevin
Posts: 3314
Joined: Wed Jan 30, 2002 1:57 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:32 am

UAL still has over 3 billion in unencumbered assets. Their aircraft. So far, they haven't been able to get any decent leaseback rates. But the judge may well force creditors to accept an equity ownership in UA's fleet (i.e., turning 900 million in loan payments in a 20% stake in every aircraft they own, for example).

The end is far from close.

Steve
 
BlatantEcho
Posts: 2132
Joined: Wed Sep 27, 2000 10:11 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:37 am

man, I don't even feel sorry for them anymore. The employees sure, but the entity that is UAL, man they just ran themselves into the ground.

That's all opinion and conjecture, but I hope UA is broken up so thatsmarter more customer friendly airlines take up their aircraft, routes and employees.

George
 
User avatar
yyz717
Posts: 15779
Joined: Mon Sep 10, 2001 12:26 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:45 am

You can't separate the employees from the company. If UAL fails, it reflects fully on the employees. It's the employees who elect the union leaders who negotiate the pay & work conditions. If the unions hold the mgmt over a barrel (as happened with PA, EA, TW), the airline will fair poorly.

I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:47 am

Those $3 Billion in unencumbered assests are not really worth $3 Billion. The deserts are full of unwanted aircraft. It is a huge buyers market, and UAL cannot expect to get anywhere near what those aircraft are worth on paper or what they could have been sold for years ago.
 
User avatar
RayChuang
Posts: 8139
Joined: Sat Jun 24, 2000 7:43 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:52 am

Folks,

I don't think UA will go out of business.

There are three reasons for this:

1. UA is too big an airline--an airline with many lucrative international routes--to go down like this.

2. The other members of Star Alliance will NOT stand idly by watching one of the founding members of the alliance go down like this.

3. It would have devestating effects on the entire airline industry--the fall of UA could cause the fall of US, AA, CO, NW and DL down the road.

I think what will happen is that there will be emergency legislation passed in Congress to save UA--mostly by merging with US and substantially cutting back on its domestic route structure. After all, the US government did that for Chrysler and through strong leadership and careful cost-cutting the company emerged actually stronger than ever.

Folks, this is not akin to the fall of the original Braniff or Eastern, airlines that were already on the ropes due to healthy competition from other airlines. The fall of UA will rip a huge chunk out of the domestic seating capacity--and will devestate the cities of Chicago, Denver and San Francisco in terms of tax base.
 
777236ER
Posts: 12213
Joined: Sat Aug 18, 2001 7:10 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 8:54 am

1. UA is too big an airline--an airline with many lucrative international routes--to go down like this.

Unlike Pan Am.

2. The other members of Star Alliance will NOT stand idly by watching one of the founding members of the alliance go down like this.

What can they do?! I think you'll find the answer is "not a lot".
Your bone's got a little machine
 
User avatar
RayChuang
Posts: 8139
Joined: Sat Jun 24, 2000 7:43 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:00 am

777236ER,

However, unlike Pan Am, UA has an excellent feeder network to their major international airport operations (SFO, LAX, ORD, JFK and IAD). One of Pan Am's most stupid moves was to sell its Pacific Division to UA in 1985, especially considering that the Pacific routes are generally very lucrative moneymakers.

My idea of a Chrysler-style bailout is not out of the question. After all, it did save that company.
 
User avatar
STT757
Posts: 14287
Joined: Tue Mar 28, 2000 1:14 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:00 am

The ATSB (established by Congress after the 9-11 attacks) just denied UAL their loan gurantee, why would Congress change their mind?.

Congress controls the ATSB, and they just spoke on the subject.
Eastern Air lines flt # 701, EWR-MCO Boeing 757
 
MSY-MSP
Posts: 147
Joined: Thu Jun 20, 2002 4:18 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:01 am

Well this is a sad thing to see, but this may be the best thing for UAL long term. As many have said chptr 11 is far from the end of an airline. It gives UAL plenty of room to work with when they emerge.

1) All of their debt is either wiped out or restructured according to the court. Banks and other creditors form committees based on whether they are secured or unsecured creditors. The secured creditors committee is the one that really drives the handling of the assets. If a secured creditior wants to force the sale of the assets on which he is secured then he can. In this market I don't think there is much chance of these creditors wanted to put used aircraft on an already flooded market place. The unsecured creditors have to wait until all of the secured are paid off or satisfied, before they get there share. In Chptr 11 once the judge feels that the creditors have gotten a fair deal then UAL will be allowed to emerge from bankruptcy.

Now here is what i think will happen

A) UAL files for bankruptcy either tomorrow or Friday

B) DIP finaincing comes from Bank One with Citi Bank, JP Morgan or GE Capital. Bank One is DIP because of the UA Mileage Plus Card, which brings them plenty of money, and they don't want to lose this source of revenue. Citi and JP are common DIP finaincers, and GE Capital has a lot of money tied up in UAL.

C) UAL restructures its debt with its creditors, either changing the terms of the debt or by wiping it out totally.

D) The remaining Airbus orders are cancelled

E) The 733, 735, and 762 leave the fleet and are sold or scrapped

F) Most of the 744's are sold off. UAL will keep maybe 6-10 for opps to SYD and high capacity routes to NRT.

G) Route changes. Gone will be SIN, OSA, TPE, MUC, all of the SA routes. MIA sees drastically reduced service. LAX service is reduced. IAD goes regional with cross country, HUB-HUB traffic, Trans atlantic, and a few other routes remaining mainline. Most other routes will see reduced traffic. Net reduction of UAL flights will result in approximatly 1250-1300 flights/day.

H) Labour contracts. -- All of them will be voided. The mechanics vote tomorrow is meaningless in terms of no bankruptcy. The court will impose on the Unions a contract that most likely will lead to pay cuts of upwards of 45-60% of current pay. Not a pretty site for the Unions. Also staff cuts of arround an additional 20% over current levels

Following Chptr 11, UAL will be the #3 airline in the US behind AA and DAL, but probably not long. I also think that 3-4 years down the line UAL and US will merge as both combined will likely be smaller than AA is today. However, I also think that if the pay cuts UAL gets in Bankruptcy are to the levels that I think, we may see a lot more US airlines having to go this route. I would not be suprised to AA and DAL go this route if they cannot get their costs in line with a slimmer UAL. Therefore I guess I will predict AA goes chapter 11 in Q2 2003 and DAL Q4 2003. (Keep in mind these are guesses, and not for sure facts.) Who knows what will happen to the other airlines.

THose are my thoughts, I could be wrong. I am a loyal UAL customer, and would hate to see them go. I think that this will be a prepackaged CHPTR11 and UAL will emerge stronger and healther. My thoughts go out to the entire UAL family as a very rough road lies ahead.

MSY-MSP


 
TonyBurr
Posts: 1107
Joined: Tue Mar 27, 2001 1:00 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:08 am

RayChung it would be nice to think that they are too big an airline, with all those international routes, but Pan AM had loads of international routes (granted no domestic) and TWA had both domestic/itnernational routes, and where are they. Can UA go under? Sure! It is a business. No money, no go!

It is a shame for the many wonderful employees. Absolutely pathetic management, and poor customer service since the employee take over have eroded UA, and now!!!! They lost sight of their mission. They lost so many FF. Does it definitely mean the end? No! But they have a lot to work out.
 
UALPHLCS
Posts: 3232
Joined: Thu Jun 28, 2001 5:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:16 am

P.S.

There is a clause in the contract ratified by the Unions that UA will NOT void them except as a last recoarse.

"In the Event of a bankruptcy filing, the Company agrees not to seek a rejection of the District 141 collective bargaining agreements under section 1113 or 1114 of the Bankruptcy Code unless specified events occur which threaten the Company's solvency."

Sounds like the IAM 1441M had better ratify there agreement tomorrow otherwise thier contract will be left open for revision. Ramp, CS, and Res are protected.
A little less Hooah, and a little more Dooah.
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:17 am

MSY-MSP. Check out this link. http://www.aviationplanning.com I put this link in another thread because I think its exactly right. IMHO. This former airline exec also has some insight on the DIP financing and the airplane leases. He does not paint a pretty picture and he lays it all in management's lap.

Also he says this will not be like CAL's bankruptcy or even US Airway's.
 
747-451
Posts: 2327
Joined: Wed Oct 04, 2000 5:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:21 am

"The other members of Star Alliance will NOT stand idly by watching one of the founding members of the alliance go down like this."

Sure they will...I can just see the snickering in the board rooms of Lufthansa and Air Canada, the flag carriers of some of our "staunchest" and most "reliable" allies  Yeah sure

*******

Bankruptcy will do United a bit of good. They will rid themselves of some of the contracts that did them in to begin with and pare down the amount of employees they see fit as opposed to what some of the unions want.

UA is NOT Pan Am, Eastern or Braniff since United has better route structures and more valueable assets many with no liens or encumberances.

They will dump the oldest 767's and 737's and rationalise their fleet. They may also actually obtain more A32x's and 757's. They will get rid of the leased 744's and keep the few they own out right for Asia.

They will shed some routes, but I doubt they will touch much as far as Europe, especially LHR those are assetts for sure and wont make a mistake like Pan Am did in the 80's when UA purchsed Asia and subsequently London routes from PA.

***************

Okay the machinists wanted to play rough. Now they got what they deserved.
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:21 am

UALPHLCS. Believe me when I say I know it must suck right now. But I would'nt put too much faith in that clause. I think everything and everybody will take a big hit. Ask the US Airways guys. U promised not to come after retirement, but now it loks like that will go too.
 
artsyman
Posts: 4516
Joined: Wed Feb 28, 2001 12:35 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:23 am

While I certainly feel bad for the employees on an individual basis, today the Government did the right thing. I thought Continentals statement on this was fair and to the point

"The U.S. government did the right thing for the taxpayers and for competition by letting the marketplace determine winners and losers"

Jeremy
 
apathoid
Posts: 887
Joined: Fri Sep 28, 2001 3:19 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:30 am

Na Na Na Na Na....Na Na Na Na....Hey Hey Hey...Goodbye!
 
UALPHLCS
Posts: 3232
Joined: Thu Jun 28, 2001 5:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:41 am

One question?

What the hell was $10 billion dollars in money set asside FOR if only a fraction was ever doled out.

Basically 2 airlines got the ATSB loans so this whole program was a huge boondoggle and political stunt when it was passed by Congress.
A little less Hooah, and a little more Dooah.
 
User avatar
coronado
Posts: 1278
Joined: Sat Jun 26, 1999 9:42 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:51 am

Congress already gave cold hard cash in the billions. The rest was cosmetic reassurance. UAL problems go back a long time with a string of weak management buying hotels, selling hotels, buyiing into rent a car fleets, selling rent a car fleets, setting up a biz jet operation, writing off a biz jet operation.

As we have seen big businesses are not imune to inept management, a management that has also been unable to treat employees and customers as valuable entities.

United will continue as a smaller carrier after bankruptcy, but I am still not convinced they have the management to really turn things around as opposed to just plodding along unable to save money for the inevitable rainy days.

Who will be their Bethune?

The Original Coronado: First CV jet flights RG CV 990 July 1965; DL CV 880 July 1965; Spantax CV990 Feb 1973
 
User avatar
chrisnh
Posts: 4135
Joined: Tue Jun 29, 1999 3:59 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:52 am

In our lexicon, 'bankruptcy' means 'going out of business' to many people. In fact, you can have one without the other and it happens often (a la Continental et al). United will continue flying and will emerge just fine. The issue is the time period over which this will occur.

And, to the poster who said that you 'cannot separate the employees from the airline.' Amen, brother! These union folks like to grouse about how 'management' is to blame...as though the employees and their unions are powerless through it all. Kind of like the kid who throws a baseball through a window and then points at another kid, saying, 'He did it!' Or the infamous 'Not Me!' gremlin that floats around the house every time a glass vase or lamp falls to the floor & breaks  Wink/being sarcastic
 
Guest

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 9:52 am

I think United will most likely file Chapter 11 pretty soon, most likely tomorrow or Friday. I also believe that they have the potential to pull out of it and successfully reorganize. They will weather the winter. Most likely will be the #3 or #4 carrier when this is all over, but I don't think the chances are that great that United will melt down completely.
 
Delta737
Posts: 469
Joined: Sat Jun 05, 1999 11:23 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 10:02 am

UAL will be fine. Bankruptcy doesn't mean that they're closing shop, just restructuring the business model with protection against creditors.

UAL is way too big and way too politically connected.

Besides, it's going to be bad for everyone else NOT in bankruptcy having to compete with UAL.

Doug Taylor
 
hkgspotter1
Posts: 5750
Joined: Fri Nov 04, 2005 12:43 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 10:02 am

One good thing. When they are no more that horrible scheme will be gone for GOOD !!

I just hope the staff can find other jobs.
 
UAL-Fan
Posts: 345
Joined: Thu Dec 09, 1999 1:36 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 10:07 am

YES,

I actually wrote letters to my Representatives voicing my objection to the Government backing such a poorly run Business.

United's management and their greedy employees along with their whacked out Unions caused this mess....Now they will have to deal with the wreckage.

I own a small business, I can't even conceive of having my employees having the power to run my Business into the ground like they have with United. Does this make sense to anyone?
 
FDXmech
Posts: 3219
Joined: Sun Mar 19, 2000 9:48 pm

ChrisNH & Yyz717

Thu Dec 05, 2002 10:12 am

I strongly suggest you read the link provided by MD88Captain in reply 19.

You're only as good as your last departure.
 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 10:16 am

That Aviation Planning link has to be one of the more logical and to-the-point sites I've ever read on any topic.

N
 
kaitakfan
Posts: 1547
Joined: Fri Oct 29, 1999 1:04 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 11:33 am

Here's to you HKGspotter! Sorry to burst your little bubble...

View Large View Medium
Click here for bigger photo!

Photo © Craig Murray


This view is not going ANYWHERE!

Its a shame so many people are taking joy in the fact that thousands and thousands of employees such as my mom are really stressing now adays over this crap at United. Really tasteless people indeed! On a side note, thanks to those for the nice comments who care for the employees of United. Shit is about to hit the fan, but we will all make it through!
 
ouboy79
Posts: 4115
Joined: Sun Nov 18, 2001 1:48 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 11:54 am

No airline is too big to fail, no business for that matter. Let's just look at one company in particular - Enron.

My thoughts are with the employees of UAL. This will be the best thing for the industry. A nationwide (not restricted to just one area of the country) capacity reduction is EXACTLY what this industry need. All communities will be covered with some "right sizing" of capacity. Continental will return to Denver, DL and AA will pick up a few International routes...and US will control the district once again. NW will be king in the Pacific and Southwest will finally control the west coast with out any pesky Shuttle planes flying around.

Now we know why STAR has been pushing up the acceptance of US Airways into the alliance...to counter this very situation.
 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:00 pm

Ouboy79,

That doesn't make much sense does it? US is doing worse and worse every day... I doubt they'd want to replace the second largest airline in the world with the 6th largest US airline that's also to go out of business.

N
 
artsyman
Posts: 4516
Joined: Wed Feb 28, 2001 12:35 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:06 pm

I dont see them adding anyone, AA has been rumoured to be the one, something to do with discontent with their open skies continually being blocked with BA, but I cant see it happening. Delta would be next choice, and I dont see that happening, nor do I see NW, or Continental doing it.

Jeremy
 
AlaskaMVP
Posts: 145
Joined: Thu Jun 07, 2001 11:41 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:10 pm

Don't feel sorry for the employees, they are directly the cause of this mess. Just be thankful our tax dollars aren't bailing them out.

Following are some quotes from Scot Mcartney's column in the Wall Street Journal today. It's an excellent commentary, if you can get a copy of today's WSJ you should read the whole thing.

"Since the U.S. Department of Transportation began publishing on-time statistics in 1987, United has ranked ninth out of the nine major airlines. In the past five years, United has been either last or next-to-last in baggage handling. For 2000 and 2001, United led the industry in customer complaints."

"And in Chicago, American has narrowed United's advantage. In March of 1999, shortly after American's passenger-infuriating pilot sickout, United had an 18-percentage-point edge over American in share of domestic revenue in Chicago, according to J.P. Morgan. By the summer of 2000, when United had its customer-infuriating pilot slowdown, the gap was just nine points -- and it has remained at about nine points since."

"One can build a case that the summer of 2000 was the turning point for United. UAL managers were desperately trying to win approval from labor and government to acquire US Airways Group Inc., and were willing to buy pilot approval. Pilots were out for blood. Rick Dubinsky, the former head of United's pilot's union, famously said pilots didn't want to kill the golden goose, "We just want to choke it by the neck until it gives us every last egg.

Instead, it was passengers who got choked. To force management's hand, pilots ground United's operation to a snail's pace. "

"United's mechanics earlier this year wanted a deal better than the rich new contract signed by mechanics at Northwest Airlines. No doubt that they'd get it -- employees own more than half of United's stock and both pilots and mechanics have great clout on the board of directors."

"What's more, United CEO Jim Goodwin, who had accurately predicted trouble only to anger employee-owners, stepped down in October 2001, under fire from employees. The ship was rudderless at a crucial time."

"For employee ownership to work, employees have to act like owners, not employees. At United, that didn't happen."

"Perhaps more importantly, employees thought the company should be run for employees, not customers. Employees at times abused customers to get what they wanted. The lack of customer service surely has caught up to United."

 
sllevin
Posts: 3314
Joined: Wed Jan 30, 2002 1:57 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:12 pm

Md88Cap:

While the aircraft may have a debatable value, it's still far greater than zero. And leasebacks (which these would be, essentially) are still available at decent rates for airlines -- look at AA's recent deal with Arkia. UA is certainly not a great credit risk, but once in Chapter 11, should be able to swing significant deals to continue. People like GECAS certainly don't want to see UA park everything and put hundred of new, modern airliners on the market -- it'll kill their current lease rates!

Steve
 
CRJ 900
Posts: 560
Joined: Mon Mar 12, 2001 4:41 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:32 pm

B747 451 why would there be snickering in the board rooms of AC and LH? You seem to have a hate on for anyone foreign, i saw your comments in the post over the UA 74s coming to AC and i reserve the right to say that don't go slamming and generalizing people over the comments of one person. Remember one thing my friend,,,,we at AC posted a profit in our last quarter, none of the major airlines in the US did that. AC is willing to help by taking some 747400s from UA (mind you i hope Milton knows what he is doing and if so, they couldn't be going to a better home), but hey, we're willing to help any way we can.
 
MD88Captain
Topic Author
Posts: 1224
Joined: Wed Nov 14, 2001 9:50 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 12:40 pm

I agree that there is value there, but I really don't see much of a market for UAL's used aircraft. And that very soft market will hurt UAL is BK. The DIP financing will be at exhorbitant rates for much less than te book value of the aricraft IF they can find anyone that wants to take a chance used aircraft as collateral. And I wonder if those foriegn routes are worth the huge amounts some think they are. Who has huge amounts of money to pay for them? No US carriers can afford say $1 Billion to go to LHR.

UAL may very well gain lower lease rates, but will it help that much? There are so many minuses I just do not believe that anyone can believe that coming out of BK is a sure thing or even a pretty good bet.

US Airways seems to have a good plan, but look what's happening. They cut leases. Routes have been cut. The Rj's limits have been raised. Airplane have been parked. And they are still bleeding money. And the employees are bearing a huge burden in decimated pay/benefits and soon to be at risk retirement funds.

The real heart of any airline is the employees. The US Airways folks have always worked hard at running a good airline and yet they are floundering in BK. The UAL employees are a disfunctional group by and large (Pls no flames, I have some close friends at UAL). And the UAL folks have had a leadership void for years. I just can not help but see how this is going to be a total melt down for UAL. And please believe me that I take no pleasure in saying that.
 
BWIA330
Posts: 825
Joined: Tue Jan 23, 2001 10:22 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 1:23 pm

This certainly isnt good news for UAL and its employee's. I just read more bad news on yahoo that the FAA has a fine pending against United for 3 Boeing 757's that were flown with holes in the spoilers. United taped the wing with a special tape and flew 193 times with these aircraft before making permanent fixes. The fine is for $805,000.

It just seems to be getting worse for United.

http://story.news.yahoo.com/news?tmpl=story&u=/nm/20021204/ts_nm/airlines_united_faa_dc_1
 
User avatar
RayChuang
Posts: 8139
Joined: Sat Jun 24, 2000 7:43 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:04 pm

Here's the big question: if UA does file for reorganization, what will happen to UA's fleet?

I had mentioned one possibility in another message, but the more I think about it the changes to UA's fleet will come down to this:

1. 747-400 fleet--UA will reduce its 744 fleet to at most 21 planes. They can't reduce it any further due to the very busy and lucrative transpacific routes. Some of the 744's will be sold to AC, and don't be surprised that Air India will take over 8-10 ex-UA 744's for increased seating capacity on the routes from DEL to the USA via LHR.

2. 777-200ER fleet--UA will not sell any of this fleet. The 772ER will become UA's primary transatlantic transport and will be used on some transpacific routes.

3. 777-200A fleet--UA may reassign some of them to USA transcon and USA West Coast to Hawaii flying (after the interiors are redone into two-class configuration), and a few of them will be sold off to airlines that can use them on higher-capacity regional flights (CX, SQ, KE, JL).

4. 767-300(ER) fleet--UA will probably keep the majority of the fleet; many will be reassigned to US transcon flights, very likely the SFO-JFK and LAX-JFK routes.

5. 767-200 fleet--UA will phase them out, mostly because they are among the oldest 767's flying. They'll probably be converted to freighters for use by airlines flying freight.

6. 757-200 fleet--UA will phase out the oldest 752's and keep the rest for higher-capacity regional routes.

7. A320 fleet--UA cancels any outstanding orders but keeps the planes it already has. They will become the primary plane for medium range routes.

8. A319 fleet--UA cancels any outstanding orders but keeps the planes it already has. They will become the primary plane for short range routes.

9. 737-300/500 fleet--UA phases them out. They'll probably be sold to any airline that needs additional 737-300/500 planes (maybe WN?).

I do see that UA may merge with US also. This will likely mean that most of US' current fleet (except for the A319/A320/A321 fleet) will be sold off, and the UA/US combination will phase out all route duplication, sell off both the PIT and PHL hubs, and UA turns CLT into the primary southeast US hub for the airline.
 
drewwright
Posts: 530
Joined: Tue May 15, 2001 3:51 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:06 pm

Does anybody know how much cash United is going through a day? When they declare bankrupcy that money will pretty much be all they have for fuel payments etc.....
DRW
 
maiznblu_757
Posts: 4952
Joined: Fri Mar 01, 2002 12:05 pm

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:09 pm

I dont know if anyone saw NBC news tonite, but, the experts they interviewed seem to think that UAL is done, even if they do file bankruptcy. They also said American is in really rough shape. They said Delta is hard to say. Northwest and Continental are by far the leaders, and USAirways is making a comeback.

 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:15 pm

As much as I root for a UA-UA merging, I can't help but wonder...

If you transplant a lung from one cancer patient to the other, won't they both still die?

N
 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:17 pm

Was supposed to say UA-US merging. The A and the S are next to each other.

You know, additionally, I wonder how many of the musings that go on in this forum actually occur to the people in the situation? We think a lot about UA and US merging, but do the people at UA and US think about it??

N
 
tu154m
Posts: 613
Joined: Tue Oct 02, 2001 4:52 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:29 pm

Hello.....
The news said UA is losing $7 million a day right now. They also said the main reason the ATSB refused UA's application was that there was no feasable plan of turning things around to make a profit. It viewed the labor concessions and other cuts as stop-gap measures, not ones that would return the carrier to making a profit.
Steve
CEOs should swim with cement flippers!
 
AA717driver
Posts: 1502
Joined: Tue Feb 12, 2002 8:27 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:32 pm

The problem for the other majors will be if UAL is allowed to wallow in Ch. 11 for a couple of years. The ticket dumping and accounts payable reduction will be impossible for the others to overcome outside of their own Ch. 11.

This could have a cascade effect on the rest of the industry. AA is in trouble but doesn't really have to file. If they do, then NW or DL(neither of which are REALLY in trouble) will soon get behind the 8-ball and eventually file.
Then, can you ask CAL to stand alone and "take it like a man" while its competitors skate on payments?

I am praying for the employees of UAL--BTDT three times! But if a schlep like me can see the potential problems, the gov't can surely see even deeper.TC
FL450, M.85
 
AA717driver
Posts: 1502
Joined: Tue Feb 12, 2002 8:27 am

RE: UAL Rejected By Atsb

Thu Dec 05, 2002 2:42 pm

Ok, I just read the aviation review link. I still think the cascading Ch. 11 is a possibility. Michael Boyd is guessing too. We have stepped through the looking glass...TC
FL450, M.85

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos