UAL Liquidation

[Ukridge]

All right gents. What is now the story at UAL? Recent press here in the old country (actually an article from the London Observer) is stating that UAL will be liquidated before the end of the year and that American will be the new Star Partner. I realize the high stakes games that are being played at the political level concerning your loan secutity but those of us who purchase tickets on the Star carriers and reap the rather pleasant rewards of the mileage programs are growing a bit tense with this.
I can understand your competition leveraging their superior position in the media to disuade the ATSB but frankly I would never have expected to see your maintenance staff as the ones most hungry for the dissolution of their employer. Why their earnestness to drive the company out of business? Is the hatred really that virulent?
UAL seemed to have found a solid leader in Mr. Tilton but I, and those in my firm that travel Star, are wondering with whom we are to do business. We as business men and women will fly your carrier if given reason, but to step into a cauldron of hate where employees wish their employee ill is not what we seek in a travel experience.
The question is not rhetorical - is liquidation before year''s end the probability? If so, we are going to chuck LH for the month of December and liquidate our FF miles.
Best of luck to those of you who are trying.

 

[Ukridge]

*** Disclaimer ***
I started this thread not out of provocation but rather shock. By dint of my employment I am not able to follow every nuance of the industry. I do however, stay attuned to the press and though often eroneous, my interest is certainly raised when I read such an article. I cannot attest to the veracity of the reporting and that is why I seek opinion in this arena. The reporter spoke of the liquidation as if it were a fait accompli. Is it possible that the write is indeed the long lost sibling of Mr. C. Munn?
You can imagine the surprise of the business travelers to read such a report.

Now, actually those of us who do not subscribe to the idea of the Crown are called anti-monarchists. One of our better exports to your shores is a writer named Christopher Hitchens. Mr. Hitchens once reported on a movement for the abolition of the crown based on an argument that an American would certainly favor. This thinking goes that the monarchy is actually illegal under the EU Declaration of Rights. Why? Well, because one cannot be the soveriegn of the United Kingdom and be a catholic! Yes, it is indeed true. There is not an equal chance for all. Probably an effort to keep the French off the throne but here I run into troubled waters. If I say anything against the French the moderator will erase my posts as surely as if I made a passing send-up of Mr. Munn!
Cheers[img src='http://www.usaviation.com/idealbb/images/smilies/2.gif']

 

[Busdrvr]

[blockquote]
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On 11/26/2002 12:56:17 PM Ukridge wrote:

All right gents. What is now the story at UAL? Recent press here in the old country (actually an article from the London Observer) is stating that UAL will be liquidated before the end of the year and that American will be the new Star Partner.
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[/blockquote]

I don't understand Rugby and Cricket, or why MG made convertibles and why you drive on the wrong side of the road, or how a bunch of folks with lifestyles that belong on Springer could be called a Royal family. Likewise, Brits prob don't understand Monster trucks, trailerparks, Football (REAL football!), cold beer, Refridgeraters that work (ie NOT made by lucas), 350 CI car engines, $1.00 a gallon gas, or the death penalty. Suffice it to say that the british press prob doesn't have a full understanding of US business or our BK laws. UAL would sell lots of assests (pac, heathrow slots) before any liquidation happened.

 

[kcabpilot]

The whole idea that the ultimate fate of United Airlines lies in the hands of a few thousand Mechanics is indeed rubbish. If that were true then I imagine the leaders of the company should be termed absolute idiots for not letting them keep the lousy two bucks an hour.

I suppose someone wants the public to believe this is the Mechanic's fault. The Mechanics are simply fighting for a decent contract and if the public percieves that as trying to destroy the airline so be it, we are not PR driven, nor should we be. The Mechanic's job is in the middle of the night, out of sight and out of mind. You should have a safe and uneventful flight and never have to think of us.

 

[UnitedChicago]

Ukridge:

That scenario is rubbish.

While liquidation is a serious and real option should UA file, it won't happen over night...certainly not by the end of the year.

 

[Ukridge]

YOU GUYS JUST DON'T GET IT, IT'S THOUSANDS OF US WHO ARE FED UP WITH THE LIES AND BULLSH*T. I know we'll go chapter 11...I know the judge will hammer us...I know my career at United is over...SO F***NG WHAT...the only satisfaction I will have is knowing that I helped bring ALPA, UAL management, and the IAM with me!!! OH, and I hope everyone had a nice thanksgiving too

Well, kcabpilot this above listed gem from your compatriot mastermechanic certainly would lead to the supposition that part of the staff of UAL is in contrapostion to the goal of assiting the company in surviving. I rather blanche at such selfishness. Naturally I am confuesed at how the public perception is incorrect when someone gloats in the satisfaction of having taken down the company with them. I seek clarification on how this perception is at odds with the avowed intent implicit above?
Signed,
One of your customers.

 

[Ukridge]

Kcabpilot: The whole idea that the ultimate fate of United Airlines lies in the hands of a few thousand Mechanics is indeed rubbish.


Possibly. However, in this case although the mechanics may not have brought the airline down, they certainly are the ones who are in a position to save it. I am sure you can understand the intellectual subtilty of this. No, I am not being patronizing but it is quite frankly the situation you seem to find yourself. I would think the gentlemanly thing to do would be to save the company for those who wish it to survive and then those who do not will be afforded the opportunity to market their skill elsewhere. Do not let bitterness extend to those with whom you should brook no argument - namely your customers.

 

[UAL777flyer]

Ukridge,

I just finished reading the London Observer article in question and much of it is merely one analyst's suppositions. I'll just add him to the ever-growing list on this side of the pond of UA skeptics. While what he says is possible, so is Earth blowing up by tomorrow. Doesn't mean it's going to happen. However, the next 10-14 days will go a LONG way in determining how UA restructures and our eventual future.

kcabpilot,

I agree with you that the ultimate fate of UA being in the hands of the mechanics is a bit of a stretch on the face of things, you have to understand the context. Any union that votes down their ERP will push us right into bankruptcy. Why? Because that will surely cause the ATSB to turn down our application, at which point we are out of options and the last grain of sand slips through the hourglass. We only have until Dec 16. That is when the 10 business-day grace period for the Dec 2 debt payment expires. If we don't pay by then, we are then in legal default and can be forced into an involuntary bankruptcy filing. Suffice it to say that Glenn Tilton is no fool. He will NOT let that happen. So without the ATSB loan, we'll have no choice but to file for Ch.11 by Dec.16. That is pretty much a certainty these days.

I think the reason the mechanics are perceived to hold the company's fate in their hands is because they are arguably the most militant faction of employees at UA in this current environment. The fact that you folks have been caught up in the IAM-AMFA soap opera the last couple of years makes for a very dangerous situation given all the disinformation being spewed. None of us like the fact that we'll be taking paycuts. It sucks, plain and simple. But things could be A LOT worse, like UA being fragmented/liquidated and all 84,000 of us out on the street with NOTHING to show for the years of service we've given. And if the mechanics (or AFA or PAFCA) vote down their T/A's, then bankruptcy will follow. And that puts us into an uncertain environment with numerous vultures circling looking to pick us apart. We can still fix this thing. But EVERYONE has to be willing. Those that aren't willing simply shouldn't be allowed to enjoy their paychecks working for this company while they preach their militant stance to others.

 

[wts54]

Ukridge
London is a great place andI would love to come back someday.
The only place I have ever been where I could barely understand ENGLISH.

 

[kcabpilot]

[blockquote]
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On 11/26/2002 3:54:13 PM UAL777flyer wrote:

I think the reason the mechanics are perceived to hold the company's fate in their hands is because they are arguably the most militant faction of employees at UA in this current environment...

We can still fix this thing. But EVERYONE has to be willing. Those that aren't willing simply shouldn't be allowed to enjoy their paychecks working for this company while they preach their militant stance to others.
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[/blockquote]

This hasn't got anything to do with being or not being willing or militant. As I've said many times, this is simply cause and effect. The company has been disingenuous in their negotiations and dealings with the Mechanics time after time and you are seeing the result. Why this vacation fiasco, the pension bribe to buy votes, the “war with Iraq†clause and the rushed voting the day before Thanksgiving? Everyone I work with is willing to help but that doesn’t include having this trash shoved down our throats. Sorry, but that’s just the way it is. All of the issues involving bankruptcy, the loan guarantee and the lack of time… well, we didn’t cause all of that.

Now I may have expressed my feelings on the matter but I’d hardly call it “preachingâ€. Somehow I get the idea that you just don’t quite grasp the concept of voting.

I don’t know what’s going to happen tomorrow. I said that it looks to me like there is a very real possibility of a NO vote prevailing and I expressed my reasons why I felt that way. We’ll soon know.

 

[UAL777flyer]

kcabpilot,

Look, I certainly understand your issues with the vacation pay side of this ERP. But what would have been acceptable to you? What has your union done to explain why they gave in on the vacation part of this agreement? We are quickly running out of time. Do you think the alternative facing this company is better than this agreement? If you do, you're clearly misinformed. I just don't understand the mentality of gambling with the fate of the entire company over this. It is not as if any of us are in an advantageous negotiating position. This company is dying. We're not simply sluggishly going along. We're dying. A little bit more each day. If we go into bankruptcy, there are no guarantees that we emerge. Our competitors will continue doing their utmost to initiate our destruction. Corporate raiding investors will be circling the carcus looking to come in and make a quick buck and leave us all holding the bag. There will be thousands more layoffs. It will just be plain ugly and painful for all of us. And that's not even considering the potential for having union contracts thrown out. How is any of this any better than the ERP you're about to vote on?

I would never argue with your right to vote as you see fit. I'm just one person trying to convince those that are voting to vote with the clear-cut facts of United's situation. Do not let the anger and emotion get in the way. That's a very dangerous combination. But at the end of the day, you're entitled to vote however you see fit. Just be sure you're aware of the ramifications of voting it down. Prepare for the worst because we all just might actually see it. Good luck and hopefully cooler heads will prevail.

 

[gatemech]

Ukridge,

The analyst and media is the airlines worst enemy. Don't believe everything you read until it happens.

ual777flyer,

What makes you think that if todays vote goes in favor of the ERP that all the doom & gloom you speak of still won't happen? If the ERP goes through and UA gets the loan guarantee they might still file CH11 and if conditions are right ask to have our contract thrown out.

Most people I spoke to agree that the 4 days no pay for vacation is like a slap in the face or even harassment in some form. There was no reason for that. Add a percent to the pay cut. The vacation issue creates a hardship on a lot of people. More than the percentage. So leaving all other issues out of the picture and leave the vacation cut I have to vote NO. BTW I already did. This could have been structured different. The IAM never asked what we would be willing to live with. I didn't vote that way to destroy UA. I just didn't think the package was done fair or in the interest of the membership.

 

[kcabpilot]

[blockquote]
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On 11/27/2002 9:55:04 AM UAL777flyer wrote:

kcabpilot,

Look, I certainly understand your issues with the vacation pay side of this ERP. But what would have been acceptable to you?
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[/blockquote]

First of all, the company owes the IAM members half a billion in retro. They should have gotten that burden off thier shoulders completely once and for all. It's going on three years now and it's rediculous. They want 1.5 billion from us? Fine, make it one billion and they've made good on their obligation.

Secondly, and more importantly, they should have made a genuinely sincere, equitable and fair offer in good faith. You can blame it on the ineptness of the IAM but that's no excuse. The company continually uses that to their advantage and that is not in good faith. They should be smart enough to know that the membership sees right through it - every time. They are just totally fed up with it and the same old story of it's this or lose it all isn't working anymore. Because of outsourcing and other factors the Mechanics have been living under the same or similar threat for the past 10 years. It's crowed daily at every briefing. Call us jaded, militant, angry, stupid or whatever. Pepole didn't just crawl out from under a rock mad. There's a reason.

Anyway - I have to go vote now.

 

[wts54]

I remember in a newsreal where studdert said the money
for the retro is in the bank for the iam employees.what
happened to it ?was he just kidding us ?

 

[UAL777flyer]

Quit complaining about the retro. Your union agreed to have the money deferred. If you want to point fingers, start at the union hall.

gatemech,

Yes, you are correct, simply voting down the ERP today doesn't necessarily mean imminent gloom and doom. But think about this. The debt payment of $375 million in publicly held EETC debt is due on Dec 2nd. There is a 10-business day grace period which brings us to Dec 16. If we don't pay it by then, we are in legal default and can be pushed into an involuntary bankruptcy filing. The chances of pushing off paying this debt are next to nil because it is publicly held debt. And considering our current cash position, I would be EXTREMELY surprised if we paid the debt. So, if we do not have all union agreements by then, we will certainly NOT get the ATSB loan guarantee and would have no choice but to file for Ch.11.

Yes, it's true that even with the union agreements we may file for Ch.11 anyway. But these agreements would be in place and the bankruptcy process would be much smoother and quicker because UA would not have to haggle with unions for weeks over deep cuts to pay/benefits/work rules/staffing. So having the agreements in place will better convince the ATSB to approve our application. If they don't, having the agreements in place will convince lenders to give us much-needed DIP financing to get us through bankruptcy. Not having the agreements in place pushes us to filing for Chapter 11. And any group that goes into Chapter 11 without an already agreed-to concessionary agreement puts themself at considerable risk for changes that could be worse.

It is by no means cut and dried. But considering the situation and the timeline, we need the agreements now. We have wasted far too much time already. People who continue to delude themselves that we have all this time to negotiate are only kidding themselves. The time with which the last grain of sand runs through our hourglass is FAST approaching.