The offered concessions fall short of the $1.5 billion
annually over six years that management had earlier proposed,
but exceeds savings previously negotiated with the pilots''
union and noncontract employees (other unions had rejected any
concessions), said Standard & Poor''s credit analyst Philip
Baggaley. United''s management did not comment on the proposal
other than to say that they would examine it, and many
important details such as allocation of concessions among
employees were left open. The proposed labor cost savings are
not as extensive proportionately as those agreed to at US
Airways ($840 million annual average over six years, with no
snap-back to previous wage levels), an airline about one-half
United''s size. However, United, with its extensive route
system, has more revenue generating potential, and thus may not
need cost cuts as deep as those at US Airways.
annually over six years that management had earlier proposed,
but exceeds savings previously negotiated with the pilots''
union and noncontract employees (other unions had rejected any
concessions), said Standard & Poor''s credit analyst Philip
Baggaley. United''s management did not comment on the proposal
other than to say that they would examine it, and many
important details such as allocation of concessions among
employees were left open. The proposed labor cost savings are
not as extensive proportionately as those agreed to at US
Airways ($840 million annual average over six years, with no
snap-back to previous wage levels), an airline about one-half
United''s size. However, United, with its extensive route
system, has more revenue generating potential, and thus may not
need cost cuts as deep as those at US Airways.
