The biggest obstacle to UAL getting an ATSB loan guarantee is that they are STILL not profitable and are not even close. UAL can tell us all about the things that other people have to do to help them turn their company around but they aren't admitting that UAL still lost $1.4B on an operating basis last year, which is more than any other US airline lost. They topped that off with a nearly $200M operating loss in January. We should be hearing the February number soon but it is bound to be incredibly negative based on the extraordinarily high fuel costs and continued invasion of low cost carriers into UA's transcon markets. The outlook for the network carriers as a group is bleak but it's especially bleak for an airline that is in bankruptcy and has not turned the corner to operational profitability despite dramatic steps forward because of huge labor concessions. Further UAL seems to be taking a very antagonistic approach to getting concessions from every entity that it needs to help it get out of bankruptcy - creditors, lessors, municipalities, and employees. UAL has very dangerously assumed that these groups will all go along with them because there is too much to be lost by those entities walking away from UAL. Even if UAL gets every one of the 8 obstacles laying in its path resolved to their satisfaction (which is very unlikely given how much they are ticking everyone off), the ATSB will not guarantee any loan if they still are not making money. The lesson from USAirways' loan guarantee was that they convinced everyone that they had a sound plan and would be profitable when they have struggled from the minute they left bankruptcy. There is no one who believes the network carrier industry has turned the corner and that includes UAL. No investor - the ATSB, commerical banks, and private equity investors - is going to invest in UAL if they continue to lose money and cannot very convincingly turn the ship around post haste.
