United (Airlines) says liquidation a "possibility"

MSNBC ^ | March 18, 2003 | Reuters

[Alberta's Child]

Good point. I'd also point out that 9/11 was nothing more than an excuse for the airline industry to hold out its hand to government for a bailout.

If you go back over the last 80 years and add up all the profits and losses for each airline in each individual year, you'll find that the airline industry right now is running at a "loss" in it's entirety.

[Arkie2]

Considering he spent years acquiring the knowledge to do his job and your butt depends on his proficiency what would you say he's worth? 8 bucks an hour? 20? Maybe you'd be happier having some burger flipper turning the wrenches?

[Beck_isright]

If the sob is playing on the internet half the day instead of turning wrenches, what's the difference? I have a relative who is a mechanic at Northwest ($60/hour). He said the stewards drink coffee and soda all day and play on the computer. Yup, them thar union boyz sure is inteligente and workin hard. Southwest and Jet Blue deserve to grow. The dinosaurs deserve what is happening to them.

[captnorb]

You forgot the biggest rip off line; US Air. They are crooks...

[verity]

Perhaps viable airlines can purchase United's equpment at 'fire sale' prices.

[Cboldt]

IIRC, USAir and United are in a joint "arrangement" of some sort, after USAir sought court protection from its creditors. There was intended to be a mutually-beneficial arrangement, with each honoring the others flyer programs, etc.

[OKSooner]

Yes, it could. American is next.

[Arkie2]

What's a steward have to do with your point about the mechanic? If there's nothing to do at the moment do you propose the company have the mechanic sit in the corner and stare at the wall? Maybe they could have him do wind sprints through the hangar? Maybe you're a little jealous about someone else having a pretty good job and you want him to earn less to make you feel better?

[zerosix]

I say, get it on!

This excuse commonly referred to as an airline regularly refused to give me a seat assignment even on tickets purchased more than 21 days (in some cases 6 wks) in advance.

Always their excuse was, "We must save 40% of our seats for emergencies." Whatever that means.

[applemac_g4]

United's in deep trouble - they lost $392 million dollars in January alone (over 10 million a day). I find it unlikely that under those circumstances (which will get worse with an Iraqi war) that the DIP creditors will continue to throw good money after bad and will likely force a liquidation sooner than most people think.

So when it comes to frequent flyer miles - use them if you've got them, and start accumulating them on some other airline.

[Wolfie]

I am just a ole boy from Mississippi so will someone please tell me how a business can NOT make a profit for years and years and years and still stay in business?

You just need a bloated Federal government with a stake in your business (ie. making sure the economy doesn't tank, and we all get re-elected), with billions of other peoples' money to throw at the problem.

[Beck_isright]

"What's a steward have to do with your point about the mechanic?"

They are supposed to be turning wrenchs too. But that's ok, they'll have plenty of work as plumbers or something soon.

"If there's nothing to do at the moment do you propose the company have the mechanic sit in the corner and stare at the wall?"

There is ALWAYS something to do where my relative works. He works at Minneapolis where Northwest is headquartered and most of their planes are based. Don't give me that union bs sympathy crap. It doesn't fly with me and the airline's problems and it won't fly with the UAW when Ford files.

"Maybe they could have him do wind sprints through the hangar?"

At least then they would be productive instead of flatuating and tying down valuable bandwidth.

"Maybe you're a little jealous about someone else having a pretty good job and you want him to earn less to make you feel better?"

Hardly. I'm quite comfortable semi-retired and running my own business. My relative summed it up: The unions are killing the airlines because they are not pushing productivity, they are more interested in protecting jobs which are not needed. Maybe your just one of those union goons who compromise the less than 14% of the working population nationally that belong to unions and helped along with management to kill US Air, United, Eastern and soon American and Northwest. Maybe you should take your brie cheese and whine to DU, you'll have a much more sympathetic audience there.

[Arkie2]

Airlines don't make money because management treats them as cash cows. Any money made is diverted into sweetheart arrangements with other entities under a holding company umbrella such as with American and the Sabre reservation system. Maybe a sweetheart deal with a catering company wholly owned by the airline or, in the case of the airline I work for, a building owned by the CEO and leased to the company and a travel department run by his daughter. Mgt has drained airlines of cash forever and in downturns it bites them in the butt.

[Arkie2]

If there's always something to do where your relative works and he's a union mechanic then what's your point about his productivity? Is he a slacker? Here's a little clue about unions. The mechanics at the airline where I work aren't unionized. The company puts them on planes to ride the system and uses them for up to 30 hours straight with no overtime. They've cut their pay in half in the last few years and are proposing another 50% cut. Guess what/ They're talking about forming a union. Unions are a result of mgts inability to treat its people like human beings. If mgt is saddled with high union costs it's because they brought it on themselves. In the case of United, the immediate problem is mgts inability to come up with a viable business plan. Unions have already given back huge amounts but mgt says it isn't enough. That's because they're too damn stupid to run the business and unions are a handy whipping boy and uninformed yahoos like you suck it up. Open your eyes and educate yourself.

[Arkie2]

http://www.aviationplanning.com/asrc1.htm

Check out this website for a primer on Unite's problems. If you're interested.

[BluH2o]

A few years back UAL management caved to salary demands from their pilots ... the end result, United pilots had the largest salaries in the industry. Other airline pilots used this as a benchmark in their negotiations with management and the process snowballed. Then the machinest/mechanics and flight attendants demanded their share and we have the situation we have today. If things don't turn around very soon (this will require a major rollback in salaries across the board) many of these people will be on the street.
Can't say I have much empathy for them ...

[valkyrieanne]

No sympathy from this quarter. The airlines have made flying a miserable experience for 15 years now. September 11 was just the coup de grace.

[bert]

UAL is close to a socialist enterprise rather than a capitalist enterprise. Thje workers took control and ran in further into the ground from a union stronghold. The y got what they wanted and now are unable to deal with the failure.

[Alberta's Child]

Maybe you're right. But let's face it -- the airline industry is very labor-intensive, requires an enormous amount of capital, and doesn't respond very well to market changes.

And the fact that it relies heavily on outside financing even in good times (I don't know of any airports or air terminals that are owned by airlines) means that many of the "costs" of operating an airline aren't even paid by the airline.

[Alberta's Child]

That was an interesting link. The comment about how much more successful the U.S. government has been at patrolling Iraq's no-fly zones than at keeping U.S. air passengers safe was particularly astute.