This article from NYTimes.com has been sent to you by psa188@juno.com. United Plans to Cut $1.4 Billion in Operations and 1,250 Jobs October 22, 2002 By EDWARD WONG UAL, the parent company of United Airlines, told employees in a phone message yesterday that it had pinpointed a total of $1.4 billion in annual nonlabor cuts that it intends to carry out. In addition, the company said in a separate announcement that it planned to save $100 million a year from a streamlining that includes the loss of about 1,250 jobs. That cut results from the closing of reservations centers, the elimination of a maintenance line and the conversion of five airport stations to cheaper regional jet service. Those efforts, along with a reduction in the flight schedule, will eliminate the 1,250 jobs. The planned cuts are intended to help strengthen a revised business plan that the company expects to submit this week to the federal government to bolster its application for a $1.8 billion federal loan guarantee. Executives are also expected to meet with leaders of United's five unions throughout the week to try to win concessions totaling $5.8 billion over five and a half years. "This week is again most critical," Glenn F. Tilton, the chief executive of UAL, said in his weekly phone message to employees. UAL is working feverishly to stay out of bankruptcy court, despite the pessimistic prognostications of many analysts. The company, which lost $889 million in the third quarter, has a large debt payment due in mid-November and says it has no access to the capital markets. The government has insisted that UAL needs to secure deeper concessions from its unions and stakeholders before Washington will seriously consider the loan guarantee application. In its announcement yesterday, United said it was shutting down one of its three Boeing 757 maintenance lines in Indianapolis. That will result in the furlough of 250 mechanics. Another 160 mechanics will lose their jobs because of schedule reductions. On Jan. 4, UAL will close its reservations offices in San Francisco; Long Beach, Calif.; and Indianapolis. It will lay off 686 workers. The company cited a 25 percent year-over-year drop in calls to its reservations line. On Jan. 7, UAL will switch from using larger, mainline planes at five of its airport stations to using 50-seat regional jets, operated under United Express. That will result in the loss of about 150 jobs. Those stations are: Eugene, Ore.; Medford, Ore.; Cedar Rapids, Iowa; Westchester County Airport, N.Y., and Syracuse. The International Association of Machinists, which represents mechanics and reservations agents, said it had no immediate comment on the layoffs. "As we speak, our representatives are meeting with United Airlines to discuss these announced furloughs," said Joe Tiberi, a union spokesman. The machinists have been reluctant to give concessions to United, but will discuss necessary cuts this week. Sarah Dela Cruz, a spokeswoman for the flight attendants' union, said the union's financial advisers had come up with a concession amount to offer United, but that that would not be made public until United had a chance to review it. The union and United executives are scheduled to begin talks today, she said. United has also been talking to various suppliers and partners about financial aid that would help it avoid bankruptcy. That includes possibly working out financial packages with overseas carriers that are part of the Star Alliance, said one person close to United's financial situation. http://www.nytimes.com/2002/10/22/business/22AIR.html?ex=1036291580&ei=1&en=c60c788175a82b8b HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@nytimes.com or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@nytimes.com. Copyright 2002 The New York Times Company