Atsb has to show there cards

ForkTime2002

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Nov 27, 2002
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[BLOCKQUOTE][BR]----------------[BR]On 12/2/2002 12:10:51 AM Taipan wrote:
[P]Either[BR]The Atsb comes out Mon/Tue and says you have been tentativley approved for your loans barring the IAM 141M ERP is passed ala US Airs pre approval if concessions are past, and they were.[BR]Or[BR]They are quiet or still saying they have to get more answers, which means they were heavily leaning on turning down the application which would have made all this a moot point.[BR]The players[BR]President Bushes Administration[BR]The Republican Party[BR]American Airlines opinion of the loan application and how it would effect them (pilots negotiations , concessions from there employees , and a CASM just south of ours, 11.3 to 10.9 the 3rd highest, strong possibility of them following us in 3/4 months)[/P]----------------[/BLOCKQUOTE]
[P][STRONG][FONT face="Times New Roman" size=3]Id worry more about northwest,they designed a powerpoint presentation as to why you guys shouldnt get the loan.[BR]The atsb isnt going to say anything until all agreements are signed.they aint gonna give **** without everyone being on board.[/FONT][/STRONG][/P]
 
Either
The Atsb comes out Mon/Tue and says you have been tentativley approved for your loans barring the IAM 141M ERP is passed ala US Airs pre approval if concessions are past, and they were.
Or
They are quiet or still saying they have to get more answers, which means they were heavily leaning on turning down the application which would have made all this a moot point.
The players
President Bushes Administration
The Republican Party
American Airlines opinion of the loan application and how it would effect them (pilots negotiations , concessions from there employees , and a CASM just south of ours, 11.3 to 10.9 the 3rd highest, strong possibility of them following us in 3/4 months)
 
Exactly. Don't expect the ATSB to rule quickly. I believe they are strongly against giving UA a loan. So it wouldn't surprise me to see them stall on issuing their ruling and pushing UA into bankruptcy. Or they'll approve the loan with such high stipulations that UA would not consider agreeing. And you can bet that if UA goes Ch.11, those same competitors will be lobbying hard for liquidation of UA. They are all fearful of a reorganized UA in the marketplace because low costs in UA's route network and STAR Alliance spells trouble for them. They've been exploiting our dysfunction for the last two years. And they know that one way or another, those days are coming to an end and they'll have to address their own shortcomings.
 
The ATSB is merely a player in the game to cheat airline workers out of a decent living. Because most airlines operate out of densely populated areas that also tend to be high cost of living areas the average airline workers pay is above average compared to other workers nation wide. The fact is the numbers are even further scewed because airline workers usually make the same wage in NY,Boston, San Fran or LAX as in Boise, Kansas City, San Antonio or Tulsa. In most other occupations this is not the case. So while it may be true that the airline workers in Boise, KC, San Antonio and Tulsa enjoy a premium wage (which they should when you consider that the airlines want premium employees-Drug free, no criminal history and a verifiable background check)the same is not true for the airline worker in the high cost areas. But this does not seem to matter to the Bush Administration or the Federal Reserve,( or even to Unions like the IAM and other catch all unions that are not headed by former airline employees) the real forces behind the ATSB. The ATSB is a political entity. They will not react until the crisis is upon us.
 
The ATSB scenario is very curious indeed.

On one side, if they were prepared to reject the loan out-right, I think they would have done so already. Politically, how would it look if UA accomplishes what many thought was impossible in a short period of time...the IAM approves the re-vote...then the ATSB rejects the loan. It would be ugly. UA has some big support in Speaker Hastert. I would think that they would have already rejected it to save political face.

So that leaves a conditional approval. How deep would the conditions go? That's the key question.

In terms of UA's prospects in CH11, I really don't feel they will liquidate. They have a proven franchise. A route structure that is the best in the world. They're on the road to concessions with employees.
 
My guess is that the ATSB has been taking the same approach that DOT/DOJ did with the UA/US merger -- they don't want to approve it, but also don't want to be the bad guy...

As an aside, the Associated Press was reporting today that an ATSB decision was due shortly. With UAL using the grace period for the two debt payments now due, I'd guess the ATSB has to make a call one way or the other before the grace periods expire.
 
I see one of two things happening:

-- The board forces UAL's hand (meaning bankruptcy) by not issuing a decision.

-- The board gives a tentative approval, but with very steep conditions, such as more cuts from employees.
 

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