Bankrupt United Cuts More Flights
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Bankrupt United Cuts More Flights
The bleeding continues...
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United cuts 12 percent of flights because of Iraq, SARS
By Dave Carpenter, Associated Press, 4/16/2003 00:34
CHICAGO (AP) United Airlines will reduce its flight schedule by 12 percent next month in response to the worldwide travel slump brought on by the war in Iraq and the spread of a deadly virus emanating from Asia.
Tuesday's announcement extends by a month the war-related cutbacks the bankrupt carrier made for April and increases the percentage of planned flights to be eliminated. United last month trimmed its April schedule by 8 percent and laid off an undisclosed number of employees.
United declined to say how many workers will be furloughed as a result of the latest cuts.
A total of 105 U.S. flights and 24 international flights will be lopped off the planned schedule as of May 5. United also said it will temporarily eliminate 131 departures operated by its regional partners as United Express flights.
As part of the schedule changes, United will reduce service to Amsterdam, Brussels, Belgium, Frankfurt, London, Hong Kong, Tokyo, Taiwan, Singapore and Sydney, Australia. A San Francisco-to-Paris flight that was suspended in April will return in May.
Generally speaking, the decline in European travel is explained by the war. The cuts along Pacific routes reflect the sharp dropoff caused by the spread of severe acute respiratory syndrome, or SARS.
United told employees on a company hot line that it anticipates returning its capacity to planned levels in June, ''assuming that demand returns.''
''Despite the temporary schedule reduction, United will still fly to all of the cities it currently serves,'' said Greg Taylor, senior vice president for planning.
Just before the war in Iraq began, United warned that bookings had declined dramatically industrywide, especially on international routes, and it might have to further reduce employees' interim wages by 9 percent or more on April 15.
Spokesman Jeff Green said Tuesday as that date arrived that the cuts wouldn't be made immediately, although he wouldn't rule them out in the future. ''The war is not over and SARS has had a significant impact on demand, particularly in Asia,'' he said. ''Really, until that bounces back, the revenue picture looks pretty bleak.''
Restructuring in bankruptcy court amid the worst industry downturn in history, United recently gained tentative or permanent agreements with all of its unions on contracts enabling it to slash labor costs by $2.56 billion annually through 2008. But it remains at risk of missing the strict cash-flow benchmarks set by its financiers in bankruptcy, which technically would enable the lenders to take back the loaned planes.
United has been in talks with its lenders seeking revisions in those requirements. Green declined to discuss the status of those negotiations.
_____________________________________________
United cuts 12 percent of flights because of Iraq, SARS
By Dave Carpenter, Associated Press, 4/16/2003 00:34
CHICAGO (AP) United Airlines will reduce its flight schedule by 12 percent next month in response to the worldwide travel slump brought on by the war in Iraq and the spread of a deadly virus emanating from Asia.
Tuesday's announcement extends by a month the war-related cutbacks the bankrupt carrier made for April and increases the percentage of planned flights to be eliminated. United last month trimmed its April schedule by 8 percent and laid off an undisclosed number of employees.
United declined to say how many workers will be furloughed as a result of the latest cuts.
A total of 105 U.S. flights and 24 international flights will be lopped off the planned schedule as of May 5. United also said it will temporarily eliminate 131 departures operated by its regional partners as United Express flights.
As part of the schedule changes, United will reduce service to Amsterdam, Brussels, Belgium, Frankfurt, London, Hong Kong, Tokyo, Taiwan, Singapore and Sydney, Australia. A San Francisco-to-Paris flight that was suspended in April will return in May.
Generally speaking, the decline in European travel is explained by the war. The cuts along Pacific routes reflect the sharp dropoff caused by the spread of severe acute respiratory syndrome, or SARS.
United told employees on a company hot line that it anticipates returning its capacity to planned levels in June, ''assuming that demand returns.''
''Despite the temporary schedule reduction, United will still fly to all of the cities it currently serves,'' said Greg Taylor, senior vice president for planning.
Just before the war in Iraq began, United warned that bookings had declined dramatically industrywide, especially on international routes, and it might have to further reduce employees' interim wages by 9 percent or more on April 15.
Spokesman Jeff Green said Tuesday as that date arrived that the cuts wouldn't be made immediately, although he wouldn't rule them out in the future. ''The war is not over and SARS has had a significant impact on demand, particularly in Asia,'' he said. ''Really, until that bounces back, the revenue picture looks pretty bleak.''
Restructuring in bankruptcy court amid the worst industry downturn in history, United recently gained tentative or permanent agreements with all of its unions on contracts enabling it to slash labor costs by $2.56 billion annually through 2008. But it remains at risk of missing the strict cash-flow benchmarks set by its financiers in bankruptcy, which technically would enable the lenders to take back the loaned planes.
United has been in talks with its lenders seeking revisions in those requirements. Green declined to discuss the status of those negotiations.
