Legion of Angels News Archive

Pick through the slag heap of the nation’s big network carriers and it’s easy to find the worst of the worst: United Airlines.

Just 29 months removed from the longest, costliest, and least-effective bankruptcy in aviation history, the nation’s second-largest airline is once again facing a financial abyss. United’s first-quarter net loss of $537 million was more than its two main competitors combined. Last month it paid a huge premium to avoid a default on its loan covenants. Its 4 percent decline in passenger traffic in May was twice as steep as that of any of its competitors. Last week’s announcement that it would ground 100 aircraft, reduce capacity by 10 percent, and shed thousands more workers was startling given the huge contraction it already experienced while in bankruptcy. A 19-month search for a merger partner resulted in rejections from Continental Airlines and US Airways, a carrier that was desperate to sell itself to United just eight years ago. The airline’s shares slid into single digits last week from a 52-week high north of $50.

United’s day-to-day operations have also deteriorated markedly. Its no-frills Ted sub-brand is being closed, the airline’s second expensive failure in the low-cost arena this decade. Travelers are furious about service cuts—the airline has eliminated some meals and some luxurious perks—on United’s high-priced P.S. (for premium service), which runs in the high-profile Transcon Triangle between New York, Los Angeles, and San Francisco. And in April, United’s overall on-time performance slumped to 72.7 percent, five points below the industry average and 18th among the 19 carriers tracked by the U.S. Department of Transportation.

United’s woes since the 1978 deregulation of the airlines are legendary. A mid-1980s pilots strike dragged on for almost a month. United failed as a travel conglomerate called Allegis in the late 1980s and ended up selling off all the hotel chains and car-rental interests it purchased. A flawed Employee Stock Ownership Plan in the 1990s tainted the entire concept of employee ownership of public companies. A merger attempt with US Airways in 2000 became a nationwide scandal after it was revealed that top managers at the carriers would have reaped hundreds of millions of dollars on the deal. A concurrent civil war with its own employees led to weeks when 75 percent of United flights ran late and passengers and baggage were stranded for days in distant locations. Then came 9/11, when two United jets were hijacked by terrorists.

But it was United’s collapse into bankruptcy just before Christmas of 2002 that is at the heart of the airline’s current crisis. Despite a 38-month stay, hundreds of millions of dollars of employee concession, and the largest pension default in corporate history, United emerged as a fiscal and operational mess. Worse, the airline’s new chief executive, Glenn Tilton, a former oil-company executive, embraced every old, failed idea ever tried by big network carriers.

Instead of a simple, cost-effective and passenger-friendly roster of in-flight services and streamlined fleet operations, United left bankruptcy in February 2006 with 26 separate in-flight seat configurations. It dabbled in everything from the upmarket P.S. to the downmarket Ted. It had five types of narrow-body jets, four types of wide-body aircraft and eight flavors of regional jets. Travelers were confronted with flights outfitted with an ever-shifting mix of one, two, three, or even four classes. (By contrast, the industry’s only consistently profitable airline, Southwest, flies just one type of aircraft and offers just one class of service.) United’s finances were equally chaotic. It left bankruptcy saddled with $17 billion in debt and its $3 billion exit financing was secured with mortgages on virtually all of the airline’s assets.

And oil is the original sin at the post-bankruptcy United. The five-year plan of reorganization (P.O.R.) cooked up by Tilton and chief financial officer Frederic “Jake” Brace predicted crude would average $50 a barrel. It was laughable even then. When United filed the P.O.R. in February 2006, oil was already selling above $65 a barrel—and a panel at the World Economic Forum in Davos, Switzerland, had just discussed the ramifications of $120-a-barrel crude.

As a result, United’s future as a going concern is an open question. One thing that isn’t in doubt, however, is the financial wherewithal of the airline’s upper management.

Tilton and his top executives emerged from the bankruptcy with 8 percent of the new United Airlines and a fast-vesting bonus plan that the New York Times called “insanity squared.” Many of United’s management team have been flipping their shares as soon as they vested, yielding tidy profits as the airline’s shares topped out above $50. But rather than curb their enthusiasm now that the market has soured on the airlines in general and United in specific, Tilton et al will pitch a new executive-incentive plan at the airline’s annual meeting in California on Thursday. If approved, it will create 8 million new shares for the benefit of the top brass.

In other words, no matter how rough the ride for United’s employees and passengers, it will continue to be smooth sailing in the executive suite.

Source — MSNBC

DES MOINES, Iowa (AP) – Some wayward ticks delayed a United Airlines flight from Denver, Colorado, to Des Moines, Iowa.

Flight 1178 was delayed for nearly six hours on Tuesday after a passenger informed a flight attendant that she found a tick in economy class during a flight from Washington, D.C., to Denver.

The airline decided it couldn’t fly the plane until it was cleaned of ticks, so passengers had to wait while another plane was flown from Colorado Springs to Denver. The flight was further delayed because of thunderstorms in the Denver area.

United spokeswoman Robin Urbanski said between one and three ticks were discovered. Urbanski said the airline hasn’t figured out how the ticks got on the plane or what type of ticks were found.

“I don’t know if we’ll be able to find that out,” Urbanski said. “When possible, we do try to look into those type of things, and hopefully try to look for its origin.”

The replacement plane shuttled the 107 passengers to Des Moines.

The plane with ticks had begun its day in Chicago, Illinois. It was cleaned of ticks, checked and put back into service.

No ticks were found on passengers.

Ticks can pass along a number of illnesses to humans, including Lyme disease.

Source — CNN

NEWARK, New Jersey - A United Airlines jetliner was coming in for a landing at the Las Vegas airport in 2006 when the tower radioed that a smaller plane was still crossing the runway.

So the United pilot executed a “go-around,” a routine maneuver in which an incoming plane pulls up at the last minute and circles around. But the jet suddenly found itself on a collision course with an American Airlines plane taking off from an intersecting runway.

The United crew took a hard right turn, the American flight veered off in the other direction, and disaster was averted. But the near-collision offered a frightening vision of what can happen during a go-round at the nation’s congested airports.

An Associated Press review of tower logs and summaries from eight of the nation’s busiest airports, obtained through the Freedom of Information Act, found more than 1,500 go-arounds during the last six months of 2007 alone.

Go-arounds haven’t been blamed for any crashes or midair collisions involving commercial airliners over the past three decades, according to a review of National Transportation Safety Board records. Still, there have been some close calls, and controllers worry that without more safeguards, a deadly accident is going to happen.

“We can go 99 percent of the time and not have a problem. But it only takes one,” said John Wallin, president of the air traffic controllers union at Memphis.

In a small number of cases, go-arounds are prompted by “runway incursions” — instances in which taxiing planes or ground vehicles blunder onto a runway in use. However, the vast majority of go-arounds are the result of congestion at major airports, where planes often land and depart every two minutes during peak times.

“We’re trained in that maneuver, so it’s not a tense situation,” said Ralph Paduano, a commercial pilot for more than 20 years who now flies for Continental. “But you have to really be on the ball; you can’t be complacent about it.”

Some controllers want the Federal Aviation Administration to take extra precautions such as staggering arriving flights and not using crisscross runways simultaneously.

The FAA said that it is looking at its procedures on a case-by-case basis — and has altered or abandoned some practices — but that the public is in no immediate danger.

In recent months, federal authorities have investigated go-around procedures at three of the nation’s busiest hubs:

* Newark Liberty International Airport, where three runways intersect at the northeast corner of the airport and planes often have to be sent around when two of them approach intersecting runways at the same time;
* Detroit Metropolitan Wayne County Airport, where a go-around procedure was discontinued this spring after air traffic controllers warned it was putting planes directly into the path of planes taking off from another runway;
* Memphis International Airport, where changes were made last year after an arriving Northwest Airlines DC-9 flew close to a commuter plane that had been forced to go around because of a mechanical problem.

At Memphis, east-west Runway 27 runs perpendicular to north-south runways 18L, 18C and 18R and is used during peak periods. After the close call in February 2007, the FAA ordered the airport to stop using all four runways simultaneously.

The practice has since resumed, though Memphis controllers now use software called Converging Runway Display Aid that employs a computer-generated “ghost target” to project where the flight paths will cross.

That didn’t prevent an incident on June 11 in which a commuter jet executed a go-around on Runway 27 and was forced to stay low while an incoming jet landing on Runway 18R — a north-south runway not covered by the CRDA — passed overhead, Wallin said. Wallin said the planes were about 800 feet apart — not a violation of FAA rules, but scary.

The Office of Special Counsel, an independent federal agency that handles whistleblower complaints, said it is reviewing a report on the Memphis runway procedure. In an e-mail to The Associated Press, the FAA said it is satisfied with the changes it made last year and has “found no safety issues” with the procedure.

At Newark, almost half of the nearly 300 go-arounds between last August and January arose from runway “ties,” in which two planes approach intersecting runways at the same time.

Controllers at Newark have been pushing the FAA to change its procedures so that arrivals for those runways are sent at staggered intervals by the New York Terminal Radar Approach Control, or TRACON, center on Long Island, which guides Newark-bound planes down to an altitude of 3,000 feet before turning them over to the Newark tower.

Staggering planes relieves pressure on controllers to keep the aircraft out of each other’s way, said Ray Adams, vice president of the controllers union at the airport.

“You have about eight miles, or about two minutes, to figure it out and make it work” after TRACON hands off the arrivals, Adams said. “It comes down to how busy you are and what your skill level is. You have to make some serious moves pretty early to get the sequence to work out.”

The FAA said it is examining the safety of the runway configuration at the request of the Transportation Department’s inspector general. But it said it has not “found evidence of excessive risk that would call for us to stop using the operation.”

In Detroit, two east-west runways form a latticework with four runways that run diagonally northeast to southwest. When one of the four was closed for repairs last year, controllers were instructed to land more planes on east-west Runway 27L.

The problem was, when a plane had to execute a go-around on 27L, it would be heading directly toward the takeoff corridor for planes departing on Runway 22L.

“It puts two aircraft in harm’s way, and that’s unacceptable,” said Vince Sugent, head of the air traffic controllers union at the airport.

The FAA said the practice has been discontinued based on the recommendations made by its Air Traffic Safety Office.

Source — MSNBC

Continental Airlines and United Airlines may not be merging, but they’re getting quite buddy-buddy. The airlines on Thursday announced a deep collaboration that will include Continental entering the 20-member Star Alliance, of which United is a member, and abandoning its current code-share agreements.

The two airlines called their deal a framework collaboration. They will link their networks and services throughout the world in an effort to benefit customers, but more importantly to save some cash now that jet fuel prices are at an all-time high. The two had discussed a capital tie-up earlier this year, but Continental abandoned those negotiations while leaving the door open for some kind of alliance with United or another carrier. (See “Continental Juggles Other Airlines”)

“In a network business, there is significant value gained from linking with larger networks to provide truly national coverage and expanded global reach, and exploring new ways to reduce costs and improve efficiencies. As we experience some of the most challenging conditions airlines have ever faced, we look forward to the benefits of a new relationship with United and the other Star Alliance members,” said Larry Kellner, chairman of Continental Airlines (nyse: CAL - news - people ).

TradeTheNews.com reported that Continental would be withdrawing from other deals it has. Partners in its current OnePass program include Air France, Delta Air Lines, Qantas and Virgin Atlantic.

Shares of the two airlines spiked on the news. UAL (nasdaq: UAUA - news - people ) was up 12.4%, or 81 cents, to $7.36 in afternoon trading, while Continental was up 8.6%, or $1.16, to $14.60.

Earlier this week, Continental said it was studying the effects the “first-bag fee” was having on other airlines like American Airlines (nyse: AMR - news - people ) and US Airways (nyse: LCC - news - people ) which have already adopted the $15.0 charge for checking a first bag for a flight. Kellner said at an investor conference in New York on Wednesday that Continental is looking into whether passengers prefer airlines that don’t charge the fee and if the charge will cause delays when boarding flights.

Source — Forbes

NEW YORK - United Airlines said Friday it will start requiring minimum stays for nearly all domestic flights beginning in October. It is also raising its cheapest fares by as much as $90 one-way.

The second-largest U.S. carrier said the moves are among a number of changes it is making to combat record high fuel prices. The Chicago-based airline has been among the most aggressive in the industry in pushing fares and fuel surcharges higher in recent months, and its latest policy could prompt other carriers to consider following suit.

Starting Oct. 6, most United fares will require a one- to three-night or weekend-night minimum stay, spokeswoman Robin Urbanski said.

The new rules, which apply to nearly every ticket, are bound to be unpopular with business travelers who prefer to catch a flight out early in the morning so they can make it back home in time for dinner.

Major carriers scrapped most minimum-stay rules — put in place largely to discourage big-budget corporate travelers from snatching up the cheapest seats — years ago, although a number of airlines have been tightening up restrictions and tacking on fees in recent months as the price of fuel has soared.

United and US Airways last week joined American Airlines in charging passengers $15 to check their first piece of luggage.

How long passengers have to stay under United’s new minimum-stay policy will depend on the destinations involved, the price of the ticket and the length of the flight.

For example, travelers booking the cheapest seats between Chicago and Minneapolis or Boston and San Diego will now be forced to stay three nights or the entire weekend, Urbanski said.

United also has raised its lowest fares by $1 to $90 one-way, meaning the least expensive available United ticket will now cost travelers $69 to $199 one-way, depending on the length of the flight.

For example, the cheapest one-way ticket for the 770-mile flight from Denver to St. Louis now costs $99, up from $89 before. A bargain ticket for a longer flight like Austin, Texas, to Los Angeles — a journey of nearly 1,240 miles — now costs $139, up from $79 one-way, Urbanski said.

Source — Yahoo!