SF Gate: California could lose big if United falters

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Friday, December 6, 2002 (AP)
California could lose big if United falters
JUSTIN PRITCHARD, Associated Press Writer


   (12-06) 00:18 PST SAN FRANCISCO (AP) --
   United Airlines may be based in Chicago, but more than a quarter of its
83,000 employees work in California, where the carrier provides essential
service from small city airports to major hubs in San Francisco and Los
Angeles.
   With sources saying the airline was preparing to file for bankruptcy
Sunday, everyone from mechanics in San Francisco to airport managers in
Eureka are wondering how United's troubles will ripple through the state.
   The immediate answer is that no one knows for sure, though the airline
promises to keep flying all routes if it files for Chapter 11 bankruptcy.
   The one sure thing Thursday at the airline's sprawling San Francisco
International airport maintenance shop was the sense of gloom -- and a
gallows sense of humor. It was a day after the federal government denied
United's request for a $1.8 billion loan guarantee that could have helped
stave off bankruptcy.
   "I was planning on working another three years," said Rich Keen, 57, a
lead mechanic who has worked 33 years for the airline. "Now, how's Monday
sound?"
   His frustration was echoed by other rank-and-file United workers, who
worried about the possibility of benefit cuts and now-worthless stock that
they received in exchange for wage cuts and work rule changes.
   United accounts for half of passenger traffic at San Francisco, where the
company employs 14,000 people. Another 6,000 people work for the airline
at Los Angeles International, where United is the largest passenger
carrier and supplies 8 percent of the airport's annual revenue with $39
million in landing fees and rentals. Nearly 1,200 people work for United
at Oakland's airport; the airline runs a quarter of the flights in and out
of Sacramento.
   And then there are the smaller airports up and down the state -- while
they don't have many United employees, the airline and its partners do
connect places such as Palm Springs, Fresno and Redding to the world.
   A United spokesman said Thursday there are no plans to cut less-profitab=
le
routes -- though that seems inevitable as the company tightens its belt.
   "People who've purchased tickets on United can have confidence that we
will operate the flights and get them where they want to go," said company
spokesman Joe Hopkins.
   Eventually, however, fliers in smaller cities could lose their options if
United consolidates its routes.
   "If it's not a profitable route, no one is going to come in to take it
over," said Judy Garrett, owner of Travel Etcetera in South Pasadena.
"It's very troublesome."
   At the Arcata-Eureka Airport, where the United Express affiliate Sky West
has 13 departures a day, manager Dan Horton worried that customers could
be out of luck, at least for a while, if United cuts service.
   Potential substitute carriers could come in, but would need to sink money
into ground equipment, counter space and other costs.
   "There's a real big investment to move into an airport," Horton said.

Associated Press Writers Don Thompson in Sacramento and Gary Gentile in
Los Angeles contributed to this report.

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Copyright 2002 AP

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