UAL going out of business?
05-23-2008, 08:09 AM
#1
Gets Weekends Off
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UAL going out of business?
Apparently, after a SWA stockholders meeting (attended by a SWA captain friend) it is being thought that UAL isn't long for this world. Some are salivating over the potential for UAL going belly up and increasing others' market share.
I am still in a regional who relies on UAL for 1/2 of our flying. I am being advised by some to consider taking my chances with Comair or another carrier that doesn't rely on UAL.
What do you think?
I am still in a regional who relies on UAL for 1/2 of our flying. I am being advised by some to consider taking my chances with Comair or another carrier that doesn't rely on UAL.
What do you think?
05-23-2008, 08:24 AM
#2
I have shiny jet syndrome
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There is no way of knowing what is going to happen one way or another. If you keep jumping ship and go from one carrier to another everytime there is bad news, you will never gain any seniority and earn somewhat of a halfway decent living.
I would say that unless you have 100% concrete proof that you are in danger of being furloughed with no chance of being recalled in an acceptable amount of time (whatever you deem that amount of time to be), stay where you are. No airline is safe right now at the regional or major level. You have to be able to stomach bad news if you want to make a career out of this industry. This certainly won't be the last time bad news comes your way, no matter who you work for. Ultimately, you need to do what you think is best for you and your family.
I would say that unless you have 100% concrete proof that you are in danger of being furloughed with no chance of being recalled in an acceptable amount of time (whatever you deem that amount of time to be), stay where you are. No airline is safe right now at the regional or major level. You have to be able to stomach bad news if you want to make a career out of this industry. This certainly won't be the last time bad news comes your way, no matter who you work for. Ultimately, you need to do what you think is best for you and your family.
05-23-2008, 08:28 AM
#3
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You might want to refer to an earlier post
http://www.airlinepilotforums.com/sh...ad.php?t=26482
Where some "smart" guys ranked the Majors in order of risk of BK.
I think it's a LONG way off for any of the majors to cease operations (including Frontier).
However, that being said, the Majors are going to be heavily reducing their RJ fleets over the next 12-18 months, so I would consider that going forward as you make your career plans.
http://www.usatoday.com/travel/fligh...cutbacks_N.htm
Fly safe!
http://www.airlinepilotforums.com/sh...ad.php?t=26482
Where some "smart" guys ranked the Majors in order of risk of BK.
I think it's a LONG way off for any of the majors to cease operations (including Frontier).
However, that being said, the Majors are going to be heavily reducing their RJ fleets over the next 12-18 months, so I would consider that going forward as you make your career plans.
http://www.usatoday.com/travel/fligh...cutbacks_N.htm
Fly safe!
05-23-2008, 08:31 AM
#4
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Posts: 1,610
- They have (IMHO) the best route structure in the entire airline industry.
- They have some of highest yield hubs in the industry (IAD, ORD, SFO, LAX, DEN)
- They have the most of the most profitable Asia flying.
- They have the most profitable frequent flyer program. This is very important. Banks profit 1 billion dollars a year from this frequent flyer program, and you can bet they are willing to pump tons of money into UAL to make sure they stay alive. We saw this after 9/11. If anything, UAL can spin this off for a huge amount of money (I think they were talking 12-14 billion dollars by selling their frequent flyer program). Of course even after this sale, they would need to stay in business to keep the frequent flyer program valuable.
- They have 3 billion dollars in cash, and do own approximately 100 of their aircraft (assets).
- Would the US government let United go out of business. I doubt it. 60,000 jobs. The nations 2nd largest airline. Probably will not happen.
- They have one of the newest fleets of the legacies (I think they are 2nd behind CAL, with a new fleet comes lower maintenance costs and lower fuel burn).
- No new aircraft on order. People rag on UAL all the time for this, but I think this is a smart move. UAL is the biggest supporter of industry mergers. Tilton has said no aircraft orders until they find a merger partner. That is a very smart move (rather than merging, and between the two merging airlines having A350's, 787's, A380's, and 737NG's on order). Wait until they merge, then I think you will see lots of orders from United.
I am not a UAL guy, nor do I really have anything vested in their success, but they sure seem to not get any credit on these forums. I would say that they are probably the most underrated airline and amongst the most likely to be successful in the future airline. They have been poorly run, but all the benefits I listed above are keeping them alive. Let them merge (CAL, US Air, someone else) and I think you will see a successful United in the future.
05-23-2008, 08:38 AM
#5
I have shiny jet syndrome
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Position: ELACS, FACs and SECs. Who doesn't love 'em?
Posts: 984
The US government will not stop an airline from going out of business. At the end of the day this is still a capitalist, lassiez-faire economy. They may do certain things to help an airline stay in business (ie. loans, tax breaks, etc...) but they can't stop an airline's liquidation. Look at PanAm, Eastern, Braniff, TWA (to an extent), and even in Europe where the government actually subsidizes their airlines and the economies are more socialized/nationalized, airlines have tanked or are on the verge of tanking. Airlines like Sabena, Swissair are gone and Alitalia is hanging on by a thread.
05-23-2008, 08:39 AM
#6
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My sister is a director over at EXO (now called world headquarters). They held a senior staff meeting yesterday. She called my father in tears this morning, they're planning 25% management layoff, and if things don't improve by summer, UAL will be out of business.
This is no let's scare the employees into more givebacks strategy, there's nothing left to give back...
This is no let's scare the employees into more givebacks strategy, there's nothing left to give back...
05-23-2008, 08:40 AM
#7
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Posts: 846
I keep seeing people mention a UAL/US airways merger. How would that help UAL at all? An East coast base in PHL or CLT, how does that help? Then you have PHX, SWA is taking over that place. So now you go head to head with them in Denver and Phoenix? I just don't see the benefit of the merger between those two.
05-23-2008, 08:49 AM
#9
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A UAL/US merger lets them reduce total overhead and, more importantly, gives UAL access to USAir's cash.
Having $3B in cash doesn't mean much when you are burning almost $.5B a Qtr. And that was BEFORE the current spike in fuel prices.
I also agree the government won't take any steps to save UAL or any other airline faced with BK or liquidation. "Market forces at work", right?
Having $3B in cash doesn't mean much when you are burning almost $.5B a Qtr. And that was BEFORE the current spike in fuel prices.
I also agree the government won't take any steps to save UAL or any other airline faced with BK or liquidation. "Market forces at work", right?
05-23-2008, 08:54 AM
#10
Prime Minister/Moderator
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It would be politically difficult for the government (any administration) to let a top-three legacy tank abruptly...too much economic impact and disruption nationwide and at hub cities.
Never say never, but I think the fed would attempt to intervene in the case of UAL. Frontier? Not so much.
Both Eastern and PanAm were shells of their former selves when the end came. Today's UAL is a much larger company.
Never say never, but I think the fed would attempt to intervene in the case of UAL. Frontier? Not so much.
Both Eastern and PanAm were shells of their former selves when the end came. Today's UAL is a much larger company.
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