United Loan Guarantee Denied!
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Say, BA can operate the Chicago O'Hare, but in NYC it can only use EWR. Once restrictions like those are imposed on this side of the pond, the game becomes fairer and the howls of protest from London would start in earnest.
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pilotusa: Given the size of the populations of the two countrys and the disparate size of the domestic airline markets, two carriers each is hardly fair. What would be fair would be to limit BA to ONE major market premier airport in the US. Say, BA can operate the Chicago O'Hare, but in NYC it can only use EWR. Once restrictions like those are imposed on this side of the pond, the game becomes fairer and the howls of protest from London would start in earnest.
The size of the population of the two countries has absolutely no bearing on the situation, none. What is a consideration is the load factors on the routes concerned.
For example if British Airways were allowed to operate 5 flights a day from JFK to LHR and United were only allowed 2, then that shows a certain disparity. But even then, this is only a consideration if both airlines are using LHR as their main base. UAL have many more flights operating at JFK on a daily basis than BA do and vice versa at LHR.
I still fail to see how BA are being given preferential treatment by the UK Government. I sense a hint of jealousy in the wind at the fact that a British Airline has done so well post 9/11 where US operators have gone down the pan despite massive government subsidies!!!!
Another long term memory fades in the UK...........
Dude, do you remember the UK government subsidy, as in owning BA. Perhaps if BA had tanked when it was on the ropes years ago the state of transatlantic travel would be better now. One less non competitive player right? Isn't that what your saying about UA? I just happen to be saying it about BA, and Air France Alitalia, etc.
Dude, do you remember the UK government subsidy, as in owning BA. Perhaps if BA had tanked when it was on the ropes years ago the state of transatlantic travel would be better now. One less non competitive player right? Isn't that what your saying about UA? I just happen to be saying it about BA, and Air France Alitalia, etc.
The basic topic was about United not receiving the loan guarantee.
An article in our "business" section stated that the Italian government will subsidize Alitalia, and the journos there guessed that the figure could be about 400,000,000 Euros. If so, I hope that tourism and the grape harvest is very.. eh, fruitful this year.
Numerous countries have subsidized airlines. This may seem unfair for a so-called free market, until you spend many years with a company and your career and retirement is at risk. Of course, this could never happen to our companies.
An article in our "business" section stated that the Italian government will subsidize Alitalia, and the journos there guessed that the figure could be about 400,000,000 Euros. If so, I hope that tourism and the grape harvest is very.. eh, fruitful this year.
Numerous countries have subsidized airlines. This may seem unfair for a so-called free market, until you spend many years with a company and your career and retirement is at risk. Of course, this could never happen to our companies.
Last edited by Ignition Override; 24th Jun 2004 at 06:33.
Too mean to buy a long personal title
West Coast: Dude, do you remember the UK government subsidy, as in owning BA. Perhaps if BA had tanked when it was on the ropes years ago the state of transatlantic travel would be better now. One less non competitive player right? Isn't that what your saying about UA? I just happen to be saying it about BA, and Air France Alitalia, etc.
Anyway, if we had no BA or VS now, and had to fly AA and UA trans-Atlantic ... I think I'd stay at home.
Moderatrix
Test Pilot for Annick Goutal
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ok ladies and gentlemen, we're on Page 2 and the thread is slightly running away. United Loan guarantee was the original topic.. keep it going.. and if you really want to move into restrictions and preferential treatments you can always start another thread.
cheers
Hawk
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UAL cut their losses to only $3 million a day last month:
United Posts $93 Million Loss in May
By DAVE CARPENTER
AP Business Writer
Thursday, June 24, 2004; 4:35 PM
CHICAGO -- United Airlines said in a bankruptcy court filing Thursday that it posted a net loss of $93 million in May -- its efforts to return to profitability complicated by near-record jet fuel costs.
The nation's No. 2 carrier, which is seeking an additional $500 million in financing after trimming its request for federal assistance, pointed to a $9 million operating profit for the month as evidence its restructuring work is paying off.
"Our cost-reduction and revenue-generation efforts are delivering results and making United a stronger, more competitive airline as we continue to move forward," chief financial officer Jake Brace said.
But CEO Glenn Tilton cautioned employees in a separate message that more cuts will be needed to cope with increased competitive pressures and soaring fuel expenditures, reiterating that United will have to "dig deeper" on costs.
"We are going to have to maintain a relentless focus on cost improvement," Tilton said on a company hot line Wednesday evening, without specifically mentioning further concessions by workers. "United has to continue to meet the demands of a competitive marketplace, and cost reduction is going to continue to be a major part of everything that we do."
May results included a 7 percent increase in passenger revenue from the same month a year earlier and represented an improvement of $164 million over May 2003 operating costs. They also included $58 million in reorganization expenses, such as breaking aircraft leases as part of a fleet overhaul, United said.
Tilton confirmed the company asked the Air Transportation Stabilization Board on Tuesday to guarantee $1.1 billion of its $2 billion in conditional bank loans -- down from $1.6 billion previously and $1.8 billion in 2002. He did not indicate when United expects to hear from the federal panel on its third and presumably last bid to take advantage of the loan guarantee program.
He said employees' efforts have given the company a "strong and solid foundation upon which to build," citing United planes that are flying with an average of 90 percent of seats filled plus "terrific" summer bookings.
Employees have made $2.5 billion in annual concessions since United filed for Chapter 11 bankruptcy in December 2002, providing about half the company's estimated $5 billion in lowered expenses. Many fear their pensions will be targeted by any outside investor, particularly with United facing billions of dollars in pension obligations in coming years.
Meanwhile, Treasury Department investigators will look into whether any inappropriate political pressure was applied to the federal board.
Sen. Peter Fitzgerald, R-Ill., has asked the department's inspector general to investigate whether board member Brian Roseboro, who voted against United's request last week, was pressured to change his vote. Roseboro is an undersecretary at Treasury and the department's representative on the board.
Richard Delmar, counsel in Treasury's Office of Inspector General, told The Associated Press on Thursday that the office will conduct an examination into the matter.
"We are going to open a preliminary inquiry on the senator's questions," Delmar said. The office will be interviewing people and gathering information to assess whether anything improper occurred.
United Posts $93 Million Loss in May
By DAVE CARPENTER
AP Business Writer
Thursday, June 24, 2004; 4:35 PM
CHICAGO -- United Airlines said in a bankruptcy court filing Thursday that it posted a net loss of $93 million in May -- its efforts to return to profitability complicated by near-record jet fuel costs.
The nation's No. 2 carrier, which is seeking an additional $500 million in financing after trimming its request for federal assistance, pointed to a $9 million operating profit for the month as evidence its restructuring work is paying off.
"Our cost-reduction and revenue-generation efforts are delivering results and making United a stronger, more competitive airline as we continue to move forward," chief financial officer Jake Brace said.
But CEO Glenn Tilton cautioned employees in a separate message that more cuts will be needed to cope with increased competitive pressures and soaring fuel expenditures, reiterating that United will have to "dig deeper" on costs.
"We are going to have to maintain a relentless focus on cost improvement," Tilton said on a company hot line Wednesday evening, without specifically mentioning further concessions by workers. "United has to continue to meet the demands of a competitive marketplace, and cost reduction is going to continue to be a major part of everything that we do."
May results included a 7 percent increase in passenger revenue from the same month a year earlier and represented an improvement of $164 million over May 2003 operating costs. They also included $58 million in reorganization expenses, such as breaking aircraft leases as part of a fleet overhaul, United said.
Tilton confirmed the company asked the Air Transportation Stabilization Board on Tuesday to guarantee $1.1 billion of its $2 billion in conditional bank loans -- down from $1.6 billion previously and $1.8 billion in 2002. He did not indicate when United expects to hear from the federal panel on its third and presumably last bid to take advantage of the loan guarantee program.
He said employees' efforts have given the company a "strong and solid foundation upon which to build," citing United planes that are flying with an average of 90 percent of seats filled plus "terrific" summer bookings.
Employees have made $2.5 billion in annual concessions since United filed for Chapter 11 bankruptcy in December 2002, providing about half the company's estimated $5 billion in lowered expenses. Many fear their pensions will be targeted by any outside investor, particularly with United facing billions of dollars in pension obligations in coming years.
Meanwhile, Treasury Department investigators will look into whether any inappropriate political pressure was applied to the federal board.
Sen. Peter Fitzgerald, R-Ill., has asked the department's inspector general to investigate whether board member Brian Roseboro, who voted against United's request last week, was pressured to change his vote. Roseboro is an undersecretary at Treasury and the department's representative on the board.
Richard Delmar, counsel in Treasury's Office of Inspector General, told The Associated Press on Thursday that the office will conduct an examination into the matter.
"We are going to open a preliminary inquiry on the senator's questions," Delmar said. The office will be interviewing people and gathering information to assess whether anything improper occurred.
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According to today's Financial Times, the ATSB has turned down United's third (and final) application.
If United are going to raise funds in the commercial market then more cost cutting will be needed.
If United are going to raise funds in the commercial market then more cost cutting will be needed.
