[BR][BR][FONT face=Times New Roman size=3]UAL's ATSB loan guarantee application consists of:[/FONT][BR]
[UL]
[LI][FONT face=Times New Roman size=3]Labor cuts of $5.8 billion over 5 years or $.16 billion per year; however, there has been no agreement on how to divide these concessions, there is no signed TA's, and now the AFA now desires equity.[/FONT][BR]
[LI][FONT face=Times New Roman size=3]Non-labor profit improvements of $1.4 billion annually. [/FONT][BR]
[LI][FONT face=Times New Roman size=3]12 percent reduction in capacity including of elimination of service to Caracas, Santiago, Düsseldorf, and Milan and five domestic cities will become United Express stations.[/FONT][BR]
[LI][FONT face=Times New Roman size=3]Starting a process to cut an additional $400 million in unspecified cuts including furloughing 1,250 employees.[/FONT][BR]
[LI][FONT face=Times New Roman size=3]reducing capital spending by $1.2 billion from 2003 to 2005.[/FONT][BR]
[LI][FONT face=Times New Roman size=3]Changing service on international routes, with B767s replacing B767s on the Paris-Washington, Paris-San Francisco and Miami-Buenos Aires routes. It also will switch B747s with B777s on the Osaka-San Francisco route, its second daily Seoul-Tokyo flight and its second Tokyo-Chicago flight.[/FONT][BR]
[LI][FONT face=Times New Roman size=3]The company continues to work with its vendors, lessors and lenders on unspecified additional measures to improve its financial position, but this was one of the major reason US Airways filed for bankruptcy. [/FONT][/LI][/UL]
[P][FONT size=3][FONT face=Times New Roman]Chip asks: [/FONT][FONT face=Times New Roman]This ATSB loan guarantee application is vague, does not have signed tentative labor restructuring agreements or any other stakeholder cuts, provides for an unspecified 12 percent reduction in capacity, and does not provide details of its revenue improvements, although additional RJ feed and the US Airways alliance are part of the revenue improvements. However, if the Delta, Northwest, & Continental alliance are approved, some of this revenue improvement would no longer be available. The question is, is that enough of a bottom line change for the ATSB to grant the loan guarantee?[/FONT][/FONT][BR][BR][FONT face=Times New Roman size=3]Meanwhile, United has retained Rothschild Inc. as a financial consultant. Rothschild advised Trans World Airlines on its Chapter 11 filing last year and subsequent sale to American Airlines parent AMR Corporation.[/FONT][/P]
[P][FONT face=Times New Roman size=3]Chip[/FONT][/P]
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