Questionable Article

[USA320Pilot]

UNITED'S BANKRUPTCY: A YEAR LATER

Recovery off ground, but ascent uncertain

Labor, operating costs are down, performance is up, but there's a huge pension shortfall

CHCAGO (Tribune) - One year ago, Robyn Eulo walked the terminals of O'Hare International Airport frightened for her job and her company.

See Story

Regards,

Chip

 

[USA320Pilot]

Here are some points from today's Chicago Tribune article I just posted above that are interesting:

Michael Boyd, an airline consultant in Colorado, believes United's strategy is too thin, citing Ted as the only new idea the airline has come up with. "That's pretty much the substance of it, and Ted has no substance to it," Boyd said.

Airline consultant Darryl Jenkins said United is in better shape, though he warned that it cannot return to its old way of doing business. "If they go outside Chapter 11 and begin raising costs again, they're dead," Jenkins said.

The company plans to finish its reorganization with roughly 100 fewer planes than it had a year ago, leaving it with about 475 aircraft. In all, United will be flying 20 percent to 25 percent less overall capacity than it did before.

United still has major work to do if it intends to emerge from bankruptcy in the first half of 2004.

So far, United's creditors have been relatively quiet. But that could change.

"They will sit down and try to negotiate how to split up the pie and determine the value of United," said Michael Kayman, a restructuring consultant in Chicago. "It's the fight, the positioning, the posturing, as everyone begins to lay claim to a greater claim than they're entitled to."

Chip comments: Who has brought up each of these points on this message board before the Chicago Tribune wrote their article? Regardless, I still believe United can emerge from bankruptcy and if they can, there will be some sort of a corporate transaction because as one member of the executive suite told me, "consolidation is inevitable".

Regards,

Chip

 

[USA320Pilot]

Pitbull & Cav:

Everything I post is true to the best of my knowledge.

Regards,

Chip

 

[767jetz]

...someone involved in the process, presumably management, is going to leak news of a corporate transaction that could result in crazy amounts of union unrest to a line pilot who has run for LEC office in U ALPA, who has a penchant for writing letters to editors of major newspapers in U hub communities and postulating left and write on public (here) and union (alpa) internet message boards. Do I have that right?

I (for one) don't find it likely under most circumstances. The one circumstance in which I do find it plausible is if someone in the upper echelons of the current management wants to spread some FUD so that the employee groups are all looking the other way when the "next other shoe" drops.

I sat next to Neal Cohen a few weeks ago on a flight to DCA--can I now claim him as an inside source? Better yet, I've got news of a UCT--after all, my firm has an "operational relationship" with U (you buy our products--I'm sure AOG has seen a few). Maybe, like Norfolk Southern, we want to play airline........

ClueByFour,

That is what I call hitting the nail on the head! Thanks.

 

[USA320Pilot]

Clue:

Your analysis and conclusions are wrong.

Regards,

Chip

 

[Cosmo]

Everything I post is true to the best of my knowledge.

Sorry, I can't let that statement go unchallenged.

While much of what you say may indeed be true, it's crystal clear that not everything you say is true. Just within the past four months, you have had two major lapses in truthfulness:

1.) In late July and August, you fabricated United's second quarter 2003 financial results to show the carrier, by your "real accounting", having a net loss of nearly $1.1 billion. In contrast, United actually reported a $623 million net loss for the quarter, inclusive of all one-time charges and credits. When this discrepancy was pointed out to you, you nonetheless continued to dramatically post your "real" number. What do you know that United, its accountants and SEC auditors don't?

2.) Only a few weeks ago, you misrepresented the position taken by some industry analysts (as reported in the Denver Post, IIRC) regarding United's fourth quarter 2003 financial results. In early November, these analysts forecast that United would record a net loss of $400-$500 million in the fourth quarter, before bankruptcy reorganization expenses, and you wholeheartedly concurred. But when United reported an October net profit of $25 million before reorganization expenses and it looked like United's quarterly loss including reorganization expenses would be much lower than the analysts had forecast without such expenses, you changed your tune and tried to claim that the above analysts had forecast the $400-$500 million quarterly loss including reorganization expenses. You even referred to the same Denver Post newspaper article, which made your error even more glaring and showed your transparent anti-United bias. Yet when questioned about this by myself and others, you remained silent. Why?

Most of the folks who post on these boards know that you are sometimes less than truthful, especially where United is concerned. So you should be much more circumspect about making claims like the one quoted above.

 

[700UW]

Mr Munn,

I believe you are the one who is wrong, not one thing you have predicted has ever come to fruition.

If you can't take criticism, I suggest you stop posting things that are not true.

 

[tumbleweed]

[Tumbleweed,

You stated:

Here we go again. Wet dreams about some fantasy merger where U employees are finally brought out of their 15 year funk and handed over the worlds premier route system at the expense of the employees at UAL.


Explain to me again abaout how UAL was handed the worlds premier route system at the expense of the employees. I of course am referring to the employees of Pan Am. Remember your roots.

4lowed ]

I'm not sure of your point. Would you like me to say that since UAL purchased those routes that we should stand by and accept them being handed over to another carrier??? As I previously stated, there will be no transfer of those routes unless there is an outright liquidation where we have no control. Short of that, our feeling is that we have not only been bilked for 5 years during the ESOP so that we can own the company but even that plus about 40 percent of our pay was taken away during the bankruptcy. We will not accept any watering down of what we have left. If you think that our summer of 2000 was about pay raises, you are severely misinformed. It was entirely due to mgmts. insistance upon shoving this merger up our collective chutes. Another stupid move like that would see an even greater response from the employees. Everyone has a right to an opinion and ours is that we have little to gain personally from any merger at this point. Our risk/reward is much greater than U's where a merger is absolutely required for survival. I for one don't feel that those are issues that we need or want anytime soon. It's apparent that our senior mgmt. feels the same.

As far as knowing one's roots, I have a fond recollection of mine. When I worked at Pan Am, we had been loosing money for fifteen years and when the Pacific was sold, as much as we hated to see them go, most were resigned to the fact that the end was in sight and there was no other way to raise money but to burn the furniture to heat the house. If your point was to compare that situation to this, there is no comparison. UAL's problems came about in a relatively very short period of time going from profits of over $2 Billion a year to losing almost that much in a period of about 2 years. Pan Am's problems were infastructure problems. The route combination just didn't make sense. UAL's were nothing about the carriers physical makeup itself but rather it's ability to adapt to rapidly changing external events. After a slow start, we are rapidly making the changes necessary to compete in this new post 9/11 world.

As I alluded to in a previous post, our company has not only had to deal with all of our internal problems and changes but also the hords of external pundits, analyst wannabees and bigmouth airline CEOs who had a large stake in gaining from our demise. It is no wonder that these subjects are sensitive. There is much greed in this industry, especially those who want what others have. I guess thats human nature but you can surely bet that we at UAL will hang on to what we have. It also gives us quiet satisfaction that these same mouthpieces are continuously 100% wrong 100% of the time.

Tumbleweed

 

[ClueByFour]

Clue:

Your analysis and conclusions are wrong.

Regards,

Chip

Really? How?

 

[767jetz]

Pitbull & Cav:

Everything I post is true to the best of my knowledge.

Regards,

Chip

I will take a crack at this quote as well.

The problem I have is with the last part...

"the best of my knowledge."

That's not saying much, as you are not as knowledgable as you claim to be. 🙄

 

[USA320Pilot]

Yesterday the Rocky Mountain Times wrote (See Story) Douglas Baird, who teaches bankruptcy law at the University of Chicago, said his "guess" is that the stabilization board will want to see an equity investor. "The strongest indicator that United is going to make it would be someone bellying up to the bar with new cash and investing in the business plan, not just taking collateral," he said. "Someone who's saying, 'I'm buying into this because I see this business making money in the long term.' " Becker, who was among analysts who thought UAL would have to liquidate because of the Iraq war, said, "I don't think United should emerge without (an equity investor)."

Chip asks: Who first wrote on this board that United would need an equity plan sponsor to emerge? Moreover, who said it could be RSA? The article that started this topic had analysts echoing what a prolific poster first reported on this board. Who was the poster?

In regard to a United asset divestiture, recently www.speednews.com reported United Airlines has posted 18 767-222s as available for sale. 6 aircraft are available for immediate sale, while the remaining twelve will be available for sale as they retire from United Airline's schedule over the next 15 months.

Separately, I understand US Airways has 8 good candidates for B757 transatlantic service, e.g. to places like Shannon & Dublin in the winter, but the company prefers to use the B767-200s first. I understand part of the "Transformation Plan" could be to get (cheap/used) B767-200s instead of using the B757 sub-fleet, but the airline must fix the core business first to conserve liquidity in the short-term before we see more widebody's to feed.

In regard to the United B767-200s, Bloomberg recently reported that United is going to phase out its B767-200 fleet in 2005 and there are reports that RSA holds some United B767/B757 EETCs, presumably part of the 174 that the Chicago-based airline told the bankruptcy court it was having difficulty renegotiating.

In fact, in a prepared statement United bankruptcy attorney Jim Sprayregen told the court last week, "We remain in a constructive, but exceedingly complex negotiation with our public aircraft debt. That group represents 174 aircraft in both our four enhanced equipment trust certificate transactions as well as a significant number of other public and older private transactions. The number of financial institutions with significant stakes in the debt represented by that group exceeds 100. There are issues regarding cross holdings of institutions among various transactions, between senior and subordinate tranches in public deals, different mixes of wide-bodied and narrow-bodied aircraft, as well as recent and older vintage aircraft among all these transactions."

Even though I do not understand why the company would want more B767-200s instead of A330-200s, apparently the company is interested in acquiring more Boeing widebody's and I believe they will come from United.

Meanwhile, with a legislative solution to underfunded pensions unlikely before Congress recesses, the Rocky Mountain News reported the ATSB has told United that it won't take a position on "any particular pension initiative," according to the minutes of an April 23 board meeting in Washington, D.C. Therefore, in my opinion United has a huge problem and the employees better get used to losing their pension or their company.

Also noteworthy, I understand members of the US Airways executive suite recently said that after stabilizing the business, US Airways will "then consider a merger and consolidation is inevitable."

Good night,

Chip

 

[Jetlaagd]

Pitbull & Cav:

Everything I post is true to the best of my knowledge.

Regards,

Chip

Chip no wonder your posts are so ignorant.....You have no knowledge. disrespecting you more each day,Jetlaagd

 

[US2]

Pitbull & Cav:

Everything I post is true to the best of my knowledge.

Regards,

Chip

Chip no wonder your posts are so ignorant.....You have no knowledge. disrespecting you more each day,Jetlaagd

Well. at least the man has the ba!!s to post under his own name. Actually. the acrimony on this thread, if indicative of what's going on out on the line, makes me wonder if I should cash in all my miles before the company goes under. Management is the problem, and you all are fighting amongst yourselves.

 

[767jetz]

You just don't give up, do you? All the empty speculation and wishing on a lucky star will not make your dreams come true. Actually, your smiley face catching some zzzz's is appropriate, since dreamland is the only place these fantasies will happen. 😀

Chip writes:
- "Douglas Baird, who teaches bankruptcy law at the University of Chicago, said his "guess" is that the stabilization board will want to see an equity investor."

- "Who first wrote on this board that United would need an equity plan sponsor to emerge?"

767jetz responds:
So what you're saying is that you are both taking a wild guess. Oh no... Baird admits to making a guess, you claim to know something others don't.
---------------------------------------

Chip writes:
- "United Airlines has posted 18 767-222s as available for sale."

767jets responds:
EARTH TO CHIP!!??? These airplanes have been slated for retirement for years. Long before any UCT talk. This is not an asset divestiture. It's called taking out the trash. You guys are welcome to those old pieces of junk! They'd fit your fleet perfectly.
---------------------------------------

Chip writes:
- "...the employees better get used to losing their pension or their company."

767jetz repsponds:
My, my Chip... What venom! Do you realize what a bitter person you sound like when you write crap like that? What's the matter? Does misery like company?

Who the heck do you think you are telling anyone what they better do!?

You better grow up there, big guy! UA has many more options than US ever did, and you sound very jealous about the fact that our bankruptcy is being handled carefully and completely, while your's was a rushed, botched, hack job that left you with a company spiraling out of control, with unsustainable costs, poor moral, and a management team who is out of options and out of ideas!

If UA ends up terminating a pension or two, then so be it. If that does happen, then by your own admission UA's biggest hurdle will be resolved. Which means the need for any transaction with your company will be even more uneccessary. Now why don't you get off the United obsession and fix your own problems.

-----------------------------------------

767jetz's final words:

Your speculations, opinions, and conclusions are wrong. Now, go back to sleep and continue your dreams.

 

[Busdrvr]

LMAO!!!

check the tail numbers Chip!! they aren't "some of the oldest", they are THE OLDEST 767's in existance. Do you want to know why 6 are for immediate sale? Because they AREN'T FLYABLE!!! THEY ARE OUT OF SERVICE!! The old 767-200's are the only fleet using the JT-9's. Old, warn out and utilizing a fleet specific engine type.... If you are interested, UAL has some moderately used 737-200's and a few more 727's still for sale. If those peek your interest, I think the ORD hub is also trying to unload some moderately used toilet paper... Maybe that's in the U fleet plan... 🙄 In any case, if you are wondering, UAL just upped the block hour forcast for the 767 for 2004.... Maybe they plan to wet lease to U....

RTF article Chip. The 174 unresolved leases involve COMPLEX lease ownership situations. An investment group may have pooled the funds of 100 investors to by 27 jets. How do you resolve individual ownership (you can't)? How do you get an agreement from all the investors? (you can't) Let's pretend Big Dave own's a few "shares" (although you have NEVER posted any evidence of it...), will he buy out the other shareholders? At what price? Why would he then bring it over to U at the higher price? Hmm, you don't think DAVE has a plan to force U to lease 767's at higher than market rates to siphon profits from U to his own pockets... Golly, then I'll bet he'll need you to take bigger pay cuts... Does the name Lorenzo mean anything to you?

"Becker, who was among analysts who thought UAL would have to liquidate because of the Iraq war, said, "I don't think United should emerge without (an equity investor).""

So he was spot on the last time he opened his trap?

"Douglas Baird, who teaches bankruptcy law at the University of Chicago, said his "guess" is that the stabilization board will want to see an equity investor. "The strongest indicator that United is going to make it would be someone bellying up to the bar with new cash and investing in the business plan, not just taking collateral,""

My kids second grade math TEACHER thinks UAL will be fine... He's a TEACHER!! IOW, he's OUT OF TOUCH with the inside goings on. He gets name recognition by saying "provacative" stuff.
UAL DOESN'T WANT AN EQUITY INVESTOR. They feel that the equity should be given to the employees and the pre-BK unsecured Creditors. Giving super majority voting rights and half the company for a few hundred million to some parasite who gets his jolly's terminating your pension to protect his own is simply not in the cards