UAL T38 Phlyer

Today UAL announced their first-quarter loss--$542 million. They have announced their intent to now remove 30 737-500s (which I believe is all of them), versus the 10-15 previously announced.

The Flight Ops Hotline (Sean Donahue) said that Furloughs were a possibility in the Fall, after summer travel is over. That's official company announcement, not hearsay. There--I did it. I said the "F" word on apc.

They did say the reason for the loss was an increase of more than $618 million in fuel costs, and that they would be trying to pass on those charges to customers.

chuckyt1

"From a Flight Operations' perspective, the capacity reductions in the fall make pilot furloughs and surpluses a real possibility. These would not occur until the fall. We still need to review the fall schedule and make a final determination on the manpower needed to support it. We are also looking to delay some technology investments, but we will move forward on those that support safety, reliability and additional fuel savings."

iahflyr

Wow. That loss surprises me. Sounds like they need to merge, or they might be in trouble. Good luck UAL. Hopefully a UAL/CAL merger will be announced soon.

REAL Pilot

It surprises/worries me as well. The operating loss was listed at $441 million. I wonder if the quoted below special charges of $445 million have anything to do with it.


"The company made a special distribution of approximately $250 million to stockholders during the quarter and reduced on and off balance sheet debt by $195 million"

FliFast

Maybe UAL will offer leaves/buyouts/voluntary furloughes ?

Is this a possibility based on past practices ??

Thanks,

FF

Andy

FF, based on past practices, they'll go that route first.
I would imagine that we'll see the leave of absence/voluntary furlough option offered up soon - it'll be interesting to see when the effective date will be.

FliFast

Thanks Andy,

There are some in every pilot group that "don't need the job" for various reasons..rich Uncle, side business, bow-legged show goat, etc. Hopefully this can keep a few on the property that really do need the job to keep the lights turned on at home.

Been there, done that, got a closet of T-shirts.

Best of Luck,

FF

mattisawesome

CAL should NOT merge with United. They would be much better off staying independent...these airlines need to cut capacity and raise ticket prices to get through the storm of high fuel costs. Most of the legacy airlines have cruddy business models that are inefficient and the legacy airlines themselves seem to never want to adapt to market conditions. CAL is the only legacy airline, I see, that has a chance on its own. SWA is another that can and will adapt to market conditions and hard times. The merger of UAL/CAL would be good for United but bad for Continental and since I want to work at Continental some day I'd say it's a bad idea.

jsled

Hey Andy,

Doing a little comparison on UAL and AMR. AMR broke out their regional affliates expenses. 721M is their number, not far off UAL's. WHat is interesting is the labor costs. AMR does not break out Eagle's, but you could multiply the 721M total expense by about 30% to get a good estimate of Eagle's labor costs. UAL pays 22% of expenses to labor, AMR pays 28% consolidated. So lets assume 30% to be high on the labor costs of Eagle. That would equal 216M. SO, now lets subtract that 216M from AMR's stated labor costs of 1.644B. AMR mainline ends up with about 1.4B in labor costs for the quarter. UAL has 1.0B in labor costs for the quarter. So UAL has over 300M of a labor cost advantage over AMR for the quarter. 300M x 4 quarters equal 1.2B. Maybe ol' Arpey was not so full of **** after all, eh? Remember he cried about UAL's 1 BILLION labor cost advantage. Do you follow me? I N E P T

Andy

mattisawecome, what's CAL going to do now they're going to get screwed in SkyTeam? They're going to have a tough road to hoe.

jsled, I'm following you on the labor costs. I don't know where they're putting the money; I know that some's been going into the IT infrastructure which was WAY out of date by Y2K. Now it's pitiful. I hope that they get it updated soon.