Shoe Drop

[Bizman]

Just wondering, when is UAL going to announce the end of the pilots retirement plan? They set the president at US and it seems that it is a hugh burden that the creditors will want removed before you emerge from BK.

 

[737nCH11]

Are you asking that as a legitimate question, or are you trying to be cute and solicit an emotional response from employees who have been concessioned to death for the past year?

 

[737nCH11]

iflyjetz,

I have friends and family at UAL. Talking to them, I shudder to think what would happen if the company tried to pull that stunt.

 

[iflyjetz]

----------------
On 6/29/2003 4:31:02 PM Bizman wrote:

Just wondering, when is UAL going to announce the end of the pilots retirement plan? They set the president at US and it seems that it is a hugh burden that the creditors will want removed before you emerge from BK.

----------------​

The difference is that UAL is currently cash positive. It'll be hard to get rid of the pension plan when UAL's making money. U was never cash positive during its chap 11 bankruptcy process. Also, U's pension plan was ignificantly more underfunded than UAL's.
Part of this is due to U's plan allowing for retiring pilots to take a 100% lump sum payout; needless to say, many hopped on that bandwagon. I don't recall the exact amount that UAL's retiring pilots can take; somewhere around 20% ... anyone, feel free to correct me on this one.
Another situation that is reducing the underfunding in the pension plan is that the stock and bond markets have been improving over the last several months.

I can't recall if Chip made a prognostication of UAL's pilot pension plan being toast; I hope so. He's a great contrarian indicator.

 

[UnitedChicago]

Here''s the plan for now...

United should be able to generate enough cash to avoid the need for an outside equity infusion and keep its pension plan intact, according to a confidential economic recovery plan presented to United''s board of directors and creditors committee earlier this month.

"This is strictly an internal recovery," says a source familiar with the plan. "They don''t want (takeover specialist) Carl Icahn or somebody like him coming in at the last minute with a couple of hundred million dollars" and taking control of the airline.

 

[Bizman]

As I said "Just wondering". Thanks for the info.