United Still Committed to Low-Cost Unit

[tug_slug]

http://biz.yahoo.com/rb/030203/airlines_un...d_tilton_1.html
Reuters
United Still Committed to Low-Cost Unit

CHICAGO (Reuters) - Bankrupt United Airlines remains committed to creating a low-cost unit as part of its planned turnaround, the airline's chief executive said on Monday.

 

[ualdriver]

Then build one Tilton!

Don't give all the employees of this airline a bunch of 'atta boys every other day in our internal company communications and tell us how wonderful we are. Don't tell us how together we're going to make the sacrifices in order to turn this airline around, and then turn around and tell us that we, nor the 1000's of people we have on the street, are not good enough to work for the new, separate low cost carrier that was surmised a few days ago.

The public has spoken clearly. They want cheap, simple tickets from point A to point B. They don't care if they're in a cattle car. They don't even care if they have a meal or a bag of peanuts. They don't care if we're the number one on-time airline or that we have the newest fleet. Heck, they probably don't even care about your safety record as long as you're not flagrantly wrecking airplanes (consider Airtran's history). We have spent way too much time and energy chasing fickle, "high yield" passengers that simply cannot and will not support the high cost network airlines have to sustain to woo them.

If you want make a portion of our airline more efficient by emulating the operations of a low fare carrier, then do it. Use this bankruptcy to wring every possible savings we can negotiate from our lenders- it's been done to us plenty in the past, and we had plenty of competitors pushing for our bankruptcy as well. Make them sorry they wished that upon us.

Take our narrowbody aircraft, every single one of them, and reduce the number of first class seats by half and get rid of economy plus, or at the very least reduce it by 1/2 or 3/4 as well. Fill the new space with more coach seats. No more meals on ANY narrowbody flight under 4 hrs except in 1st class. But you can buy one if you want (ala America West and Northwest). Staff the flights with the minimum required f/a's by FAR's. Reduce turn times at all stations and aircraft sits. De-peak our hubs. Pay EVERYONE (from management to cabin cleaners) who touch these aircraft with wages and work rules extremely similar to those at SWA/Airtran/JetBlue, etc. (we're gonna be pretty darn close to those wages anyway when it's all said and done). They can seniority promote to the widebody side of the operation for higher wages. Outsource every possible function (accounting, payroll, etc.) that exists in WHQ right now to the cheapest bidder. They're doing it for the pilots, f/a's and mechanics, so they might as well finish the job and start outsourcing themselves. Simplify our fare structure and our web site- make it just like SWA's and JetBlue's. Pick your cities from the drop down menus and here's what your fare is- and it's cheap(er). Simplify and cheapen the cost of the milage plus program. If we're gonna gouge people with fares, gouge with the widebody flying : ) SWA doen't have 737's flying to Tokoyo or Heathrow. This is all just off the top of my head. People much smarter than me could probably think or more.

Our costs will never be as low as JetBlue's (and theirs will only increase incrementally with time). They'll probably never get as low as SWA's. Maybe we can get below Airtran's. But we have network efficiencies and a brand that perhaps will not require us to get our costs as low as theirs. A serious restructuring of our narrowbody flying, in my opinion, is in order. This restructuring, in combination with the hits labor will be taking, and the hits our debtors will be taking, should significantly lower our CSM's (30%?) to the point where we will become an extremely competitive player in the market, assuming we get out of this mess!

 

[Taipan]

Bus the part about paying everyone who works the narrowbody fleet Southwest/Jet Blue Air Tran wages is just that, do you mean Southwest or Jet Blue / Air Tran because the frontline customer service /rampers with the current paycuts (14%) plus future raises of 1.5% per year plus 75% of what management wants in the remaining part of the ERP are already behind Southwest in every way across the board top to bottom and will fall more so every year for the next 6 years, this idea most can live with if your talking Jet Blue /Air Tran then they may have to break the unions to make that work.If you folks (Alpa) can match Southwest across the board then there is no excuse for us not to make money after the upcoming war is over

 

[gatemech]

ualdriver,

Good post. Only one big problem. To emulate SWA or Jetblue they would have to respect the employees. The present management team does not know how to do that. They tried to fake it during the ESOP. Even that failed. Anything they try will fail as long as the present attitude continues. I hear people saying all the time they would work for less wages on the low-cost carrier rather than hit the street. It might even open up some opportunities to relocate to small communities.

Do people want to work for dictators anymore? I think not. A change in the way management treats its employees could make any part of UAL successful.

I would be glad to work for less if the cost of living was all relative.

 

[Bizman]

[blockquote]
----------------
On 2/3/2003 2:41:23 PM ualdriver wrote:




Take our narrowbody aircraft, every single one of them, and reduce the number of first class seats by half and get rid of economy plus, or at the very least reduce it by 1/2 or 3/4 as well. Fill the new space with more coach seats. No more meals on ANY narrowbody flight under 4 hrs except in 1st class. But you can buy one if you want (ala America West and Northwest). Staff the flights with the minimum required f/a's by FAR's. Reduce turn times at all stations and aircraft sits. De-peak our hubs. Pay EVERYONE (from management to cabin cleaners) who touch these aircraft with wages and work rules extremely similar to those at SWA/Airtran/JetBlue, etc. (we're gonna be pretty darn close to those wages anyway when it's all said and done). They can seniority promote to the widebody side of the operation for higher wages. Outsource every possible function (accounting, payroll, etc.) that exists in WHQ right now to the cheapest bidder. They're doing it for the pilots, f/a's and mechanics, so they might as well finish the job and start outsourcing themselves. Simplify our fare structure and our web site- make it just like SWA's and JetBlue's. Pick your cities from the drop down menus and here's what your fare is- and it's cheap(er). Simplify and cheapen the cost of the milage plus program. If we're gonna gouge people with fares, gouge with the widebody flying : ) SWA doen't have 737's flying to Tokoyo or Heathrow. This is all just off the top of my head. People much smarter than me could probably think or more.


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[/blockquote]


Man, I think you got it!! Send it to Tilton and let's get it going. Great Ideas!!

 

[tug_slug]

[blockquote]
----------------
On 2/3/2003 9:30:17 PM gatemech wrote:

ualdriver,

Good post. Only one big problem. To emulate SWA or Jetblue they would have to respect the employees. The present management team does not know how to do that. They tried to fake it during the ESOP. Even that failed. Anything they try will fail as long as the present attitude continues. I hear people saying all the time they would work for less wages on the low-cost carrier rather than hit the street. It might even open up some opportunities to relocate to small communities.

Do people want to work for dictators anymore? I think not. A change in the way management treats its employees could make any part of UAL successful.
----------------
[/blockquote]

Gatemech I agree with you on how United's management treats their employees. Im employed by US Air, there's times I sit in on some the of e-board meetings with our Local and to hear some of the grievances and what people are being disciplined for is outrageous.

 

[Segue]

A completely separate entity makes total sense - get a fresh set of employees (management too) that are happy to work even at a lower pay scale and eliminate need for a B scale which never works. A good chance to get beyond the expectations of the past that are no longer relevant in the current environment. Also, mainline UA gets a cash infusion from the sale of assets to the subsidiary.

Even better yet, since low cost carriers are still in favor with investors, the new entity would be much more likely to attract outside capital to sustain future expansion.

As a paying customer I'm pleased with the growth of low cost carriers. A more rational fare structure is what we have been waiting for years for!

Its it any wonder why the most successful businnesses like Walmart (now the largest corporation on the planet) take a sound, low cost model and pass the savings on to the consumer.

 

[gimbalimit]

[blockquote]
----------------
On 2/4/2003 1:56:41 PM Segue wrote:

A completely separate entity makes total sense - get a fresh set of employees (management too) that are happy to work even at a lower pay scale and eliminate need for a B scale which never works. A good chance to get beyond the expectations of the past that are no longer relevant in the current environment. Also, mainline UA gets a cash infusion from the sale of assets to the subsidiary.

Even better yet, since low cost carriers are still in favor with investors, the new entity would be much more likely to attract outside capital to sustain future expansion.

As a paying customer I'm pleased with the growth of low cost carriers. A more rational fare structure is what we have been waiting for years for!

Its it any wonder why the most successful businnesses like Walmart (now the largest corporation on the planet) take a sound, low cost model and pass the savings on to the consumer.


----------------
[/blockquote]

Dear Segue,
What is it that you do for a living? I just want to know where you're coming from. As for me, I am a UAL pilot, I'm a year away from a law degree, I flew fighters in the USAF and I've worked in this industry for ten years - just so you know my biases.
OK, you cite WALMART as an example to emulate - well, let me tell you , I doubt you'd much enjoy working at 'ol WALMART - scant benefits and substandard pay, IMHO, of course. Secondly, you display incredible ignorance of the issues surrounding an employee-rich multi-national corporation. Let me see if I get your drift; break UAL up into separate individual entities, layoff (terminate, fire, etc) the majority of current employees, hire from the street a different set of employees at greatly discounted rates with bare-bones bene's, slowly (or rapidly w/ch11 mandates) strangle the original operation by transferring more and more assets to the new non-union operation, AND, expect the current set of employees to sit back and let their jobs and careers vaporize? Did I hear you right? Once you let me in on your current employment I'd be happy to recommend that your boss do the same to you, is that alright? Let me know.

Cheers, Gimbalimit

PS none of the above is meant to imply that UAL doesn't need a radically new plan, just that your suggestion is utter crap, the implementation of which wouldn't get past square one, and that you're just another idiot venturing into a foreign land with not the faintest glimmer of insight - buzzard food. Anyone ever hear of LEADERSHIP??!!??

 

[Bizman]

[blockquote]
----------------
On 2/4/2003 1:56:41 PM Segue wrote:

A completely separate entity makes total sense - get a fresh set of employees (management too) that are happy to work even at a lower pay scale and eliminate need for a B scale which never works. A good chance to get beyond the expectations of the past that are no longer relevant in the current environment. Also, mainline UA gets a cash infusion from the sale of assets to the subsidiary.

Even better yet, since low cost carriers are still in favor with investors, the new entity would be much more likely to attract outside capital to sustain future expansion.

As a paying customer I'm pleased with the growth of low cost carriers. A more rational fare structure is what we have been waiting for years for!

Its it any wonder why the most successful businnesses like Walmart (now the largest corporation on the planet) take a sound, low cost model and pass the savings on to the consumer.

----------------
[/blockquote]

Mr. Sague,
You hit it right on the head. I agree with you totally. Gimbalimit worries that they are going to strip him of his job, but what he doesn't realize is that unless there is some radical changes at UAL. He won't have a job or benefits to take away. The management is moving in the direction that they know will help this company survive. Guys like Gimbalimit are driving it into the ground. Get your law degree and then go get a job with the other ambulance chasers. You might be suprised what it is like to really work for a living.

 

[gimbalimit]

Mr. Sague,
You hit it right on the head. I agree with you totally. Gimbalimit worries that they are going to strip him of his job, but what he doesn't realize is that unless there is some radical changes at UAL. He won't have a job or benefits to take away. The management is moving in the direction that they know will help this company survive. Guys like Gimbalimit are driving it into the ground. Get your law degree and then go get a job with the other ambulance chasers. You might be suprised what it is like to really work for a living.
[img src='http://www.usaviation.com/idealbb/images/smilies/2.gif']
----------------
[/blockquote]
Yo Bizman,
Another addition to the intellectual scrap heap. You offer absolutley zero to the discussion other than hackneyed, sterotypical rubbish - plaease Mr. Bizman, I implore you, add a little intellectual horespower to the dialogue, c'mon now, you can do it - your feeble verbiage is.......simply.....boring. You will please take note that I did not shy away from the basic truth that UAL needs a major overhaul (there goes your assumption regarding my interests - and oh, BTW, Bizman, what is it that you do for a living so that I may assess your biases - I ask nothing more than what I have already offered). I repeat my assertion, the thrust of Segue's (that is Segue, not sague as you assert - attention to detail, buddy - in my world you just busted) suggestion is utterly untenable in light of the need for at least a modicum of support from labor in this precarious economy; you know, labor, the guys that actually make UAL work and which produced a number 1 ranking for operational performance in 2002. Until the flying public embraces robotic air machines we're all stuck with people to make an airline work.

cheers, gimbalimit

PS I guess going to school 4 nights a week for 4 hours at a crack (when I'm around) and being gone 15-17 days a month isn't really hard work, eh? AND, I am ready to shove my 22 years flying jets in the sh%^$er if this thing fails.
Seriously, what honorable profession do you practice? I'm waiting big guy.

 

[gimbalimit]

Mr. Sague,
You hit it right on the head. I agree with you totally. Gimbalimit worries that they are going to strip him of his job, but what he doesn't realize is that unless there is some radical changes at UAL. He won't have a job or benefits to take away. The management is moving in the direction that they know will help this company survive. Guys like Gimbalimit are driving it into the ground. Get your law degree and then go get a job with the other ambulance chasers. You might be suprised what it is like to really work for a living.
[img src='http://www.usaviation.com/idealbb/images/smilies/2.gif']
----------------
[/blockquote]
Yo Bizman,
Another addition to the intellectual scrap heap. You offer absolutley zero to the discussion other than hackneyed, sterotypical rubbish - plaease Mr. Bizman, I implore you, add a little intellectual horespower to the dialogue, c'mon now, you can do it - your feeble verbiage is.......simply.....boring. You will please take note that I did not shy away from the basic truth that UAL needs a major overhaul (there goes your assumption regarding my interests - and oh, BTW, Bizman, what is it that you do for a living so that I may assess your biases - I ask nothing more than what I have already offered). I repeat my assertion, the thrust of Segue's (that is Segue, not sague as you assert - attention to detail, buddy - in my world you just busted) suggestion is utterly untenable in light of the need for at least a modicum of support from labor in this precarious economy; you know, labor, the guys that actually make UAL work and which produced a number 1 ranking for operational performance in 2002. Until the flying public embraces robotic air machines we're all stuck with people to make an airline work.

cheers, gimbalimit

PS I guess going to school 4 nights a week for 4 hours at a crack (when I'm around) and being gone 15-17 days a month isn't really hard work, eh? AND, I am ready to shove my 22 years flying jets in the sh%^$er if this thing fails.
Seriously, what honorable profession do you practice? I'm waiting big guy.

 

[GGpillow]

Some of you guys need to quit assuming that everything that comes out of WHQ is what's "needed" to fix this airline, and that everything that comes out of labors mouth is an impediment to that process. If WHQ had a track record that wasn't...ahem, let's say, pathetic, then I could go along with everyone else here that is drinking up kool-aid by the tanker load. However, they don't. This company has shown NO innovation in it's approach to getting back on track. NONE. Every single proposal comes on the back of labor. EVERY ONE. Does labor need to contribute, yes, and, I am. Does labor need to shoulder 100% of the burden, no.
On a LCC. Is their a need for a low cost unit? Perhaps. From the way I have interpeted it, however, from transcripts of Tilton-empl meetings, I think it would be debateable that it would succeed. It needs to be structured differently then Shuttle. I have seen nothing, other then the removal of F class, that is different about this proposal from the original shuttle. They do NOT intend to use this lcc to do point to point service, but rather, to feed hubs. Personally I feel that is a mistake.
If however, they are bound and determined to go through with it, fine, I will support it. I could even agree to a B scale for it. (Although I am sure many pilots here would not agree with that viewpoint.) What I can not, and will not agree to, is voting myself out of a job. Realisticly, if I got bumped down to Shuttle 2 and took a pay cut, (What's min wage again??

 

[kcabpilot]

Management told us in a meeting tonight that the company is "focused" on the creation of a low cost carrier. They said the name of the new company will be NITED, because U ain't gonna be part of it.

They also listed three priorities:

Reduce costs
address customer needs
provide a "return" on investments

It's funny how they can talk about paycuts and what they're going to do with the profits all in the same breath. It's basically, "we'd like to take money out of your pocket and give it to someone else"

Management is entrenched in their empires, convinced that they can squeeze enough cash out of the workers to continue doing business as usual. Read the company's recent arguments concerning the CEO pay and the KERP program ($75 million needed for severances?) They are so, so out of touch with reality.

 

[Segue]

[blockquote]
----------------
On 2/5/2003 3:08:29 AM kcabpilot wrote:

Management told us in a meeting tonight that the company is "focused" on the creation of a low cost carrier. They said the name of the new company will be NITED, because U ain't gonna be part of it.

They also listed three priorities:

Reduce costs
address customer needs
provide a "return" on investments

It's funny how they can talk about paycuts and what they're going to do with the profits all in the same breath. It's basically, "we'd like to take money out of your pocket and give it to someone else"

[/blockquote]

That's exactly what it is about - pass the savings on to the consumer, and whats left, to the investors. If you really do that, the consumer and investor keep coming back. It's called free market capitalism!

 

[airplt]

[blockquote]
----------------
On 2/3/2003 2:41:23 PM ualdriver wrote:

Heck, they probably don't even care about your safety record as long as you're not flagrantly wrecking airplanes (consider Airtran's history).

Another ignorant statement from someone who has no idea what they are talking about. Why don't you explain the history of AirTran? Let us see how much you really know?

I am sorry, I guess United has never had an accident or incident!!