If you still have UAL stock, or not, the letter to the BOD is from UAUA Shareholder Advocates
Dear UAL BOD
We are writing to you as a group of voting shareholders who have waited long enough to receive a return on our investment in UAL, Inc. More than five years after entering bankruptcy, UAL still has the highest non-labor cost per available seat mile (CASM) amongst the legacy hub and spoke carriers, despite having a competitive fuel CASM. More than five years after entering bankruptcy, UAL’s revenue per available seat mile (RASM) is still far inferior to that of its closest competitor, AMR, despite having lower seating density. More than five years after entering bankruptcy, employee morale is at its lowest level in years and is reflected in customer service surveys. More than five years after entering bankruptcy, UAL’s operational statistics are marginal at best and its operating margin is the lowest in the industry. More than five years after entering one of the longest bankruptcies in U.S. corporate history, United still has a considerably higher debt to asset ratio compared to DAL, another reorganized airline. UAUA shareholders demand a return on our invested capital and we will wait no longer.
Following are a series of initiatives we know will add value to this company’s customers, employees and shareholders:
We request the board terminate Mr. Tilton rescinding all of his unvested options and shares. We challenge the BOD to search for a new CEO who will focus on operational excellence, employee morale, customer service and, ultimately, long-term shareholder return. Due to the damage done by Mr. Tilton to shareholder confidence and employee morale we see no possibility of success under his tenure.
We blame the company’s poor non-labor CASM and operational performance on Mr. Pete McDonald and therefore request his immediate termination with all his non-vested shares and options rescinded. He failed as COO and he will fail as the Chief Administration Officer. Following his termination we request a search for his replacement throughout the industry but not from within UAL. It is our opinion that only someone from the outside can come into the company with a fresh approach on how to leverage its valuable assets.
With regard to consolidation: Should it occur, we advocate that UAL not be put on the chopping block but be kept intact while merged with another carrier. UAL has the most valuable worldwide brand name, strategic U.S. hub structure and lucrative route network in the industry. Compromising these assets would be devastating to the shareholders. Furthermore, we see absolutely no benefit in merging with US Airways. Not only is its financial condition more precarious than UAL’s, but its employees have been mired in a two and a half year-long battle resulting from the America West merger. More importantly, US Airway brings no international flying to the business. We urge the board to pursue more meaningful code-share agreements within the U.S. to bolster its Atlantic inventory.
As shareholders of United Airlines we implore you to take the steps necessary to finally transform the company into a sustainably profitable company where employees and management pull on the same end of the rope. It is our, the industry’s, and Wall Street’s opinion that this cannot and will not happen under the misguided leadership of Messrs. Tilton and McDonald.
Sincerely yours,
UAUA Shareholder Advocates
Dear UAL BOD
We are writing to you as a group of voting shareholders who have waited long enough to receive a return on our investment in UAL, Inc. More than five years after entering bankruptcy, UAL still has the highest non-labor cost per available seat mile (CASM) amongst the legacy hub and spoke carriers, despite having a competitive fuel CASM. More than five years after entering bankruptcy, UAL’s revenue per available seat mile (RASM) is still far inferior to that of its closest competitor, AMR, despite having lower seating density. More than five years after entering bankruptcy, employee morale is at its lowest level in years and is reflected in customer service surveys. More than five years after entering bankruptcy, UAL’s operational statistics are marginal at best and its operating margin is the lowest in the industry. More than five years after entering one of the longest bankruptcies in U.S. corporate history, United still has a considerably higher debt to asset ratio compared to DAL, another reorganized airline. UAUA shareholders demand a return on our invested capital and we will wait no longer.
Following are a series of initiatives we know will add value to this company’s customers, employees and shareholders:
We request the board terminate Mr. Tilton rescinding all of his unvested options and shares. We challenge the BOD to search for a new CEO who will focus on operational excellence, employee morale, customer service and, ultimately, long-term shareholder return. Due to the damage done by Mr. Tilton to shareholder confidence and employee morale we see no possibility of success under his tenure.
We blame the company’s poor non-labor CASM and operational performance on Mr. Pete McDonald and therefore request his immediate termination with all his non-vested shares and options rescinded. He failed as COO and he will fail as the Chief Administration Officer. Following his termination we request a search for his replacement throughout the industry but not from within UAL. It is our opinion that only someone from the outside can come into the company with a fresh approach on how to leverage its valuable assets.
With regard to consolidation: Should it occur, we advocate that UAL not be put on the chopping block but be kept intact while merged with another carrier. UAL has the most valuable worldwide brand name, strategic U.S. hub structure and lucrative route network in the industry. Compromising these assets would be devastating to the shareholders. Furthermore, we see absolutely no benefit in merging with US Airways. Not only is its financial condition more precarious than UAL’s, but its employees have been mired in a two and a half year-long battle resulting from the America West merger. More importantly, US Airway brings no international flying to the business. We urge the board to pursue more meaningful code-share agreements within the U.S. to bolster its Atlantic inventory.
As shareholders of United Airlines we implore you to take the steps necessary to finally transform the company into a sustainably profitable company where employees and management pull on the same end of the rope. It is our, the industry’s, and Wall Street’s opinion that this cannot and will not happen under the misguided leadership of Messrs. Tilton and McDonald.
Sincerely yours,
UAUA Shareholder Advocates