CHICAGO (Reuters) - United Airlines' chief executive Glenn Tilton said on Monday he expected other unions at the struggling carrier to reach agreements on wage cuts soon, maybe this week, following the $2.2 billion pilots' accord struck over the weekend.þþTime is of the essence in United's various labor negotiations as the money-losing airline faces one large debt payment in two weeks and a bigger one in about a month. The No. 2 U.S. airline has warned of an autumn bankruptcy filing if it cannot secure cost cuts.þþLate Friday, the Air Line Pilots Association at UAL Corp.'s (UAL.N) United tentatively agreed to cut wages by 18 percent starting Dec. 1, for savings of $2.2 billion over 5-1/2 years, to help win approval for a federal loan guarantee.þþThe accord is the first major deal United has cut with any of its unions as the airline teeters on the brink of bankruptcy.þþShares of UAL were up 76 cents, or 30 percent, at $3.33 on the New York Stock Exchange. Before Monday's trading, they had lost about 85 percent of their value this year.þþA five-member union coalition in October had broadly agreed to $5.8 billion in wage concessions over the same time period agreed to by the pilots. But it never outlined which unions would take what, and each union began negotiating with United independently.þþBIG LOSSESþþThe huge airline, with some of the highest labor costs in the industry, recently posted a third-quarter net loss of nearly $900 million, on top of losses of $850 million in the first half of 2002 and a record $2.1 billion in 2001.þþAll U.S. airlines are suffering under depressed demand for travel and low fares. US Airways Group (UAWGQ.OB) filed for bankruptcy protection this summer.þþTilton, on a telephone hotline to employees, said the pilots' deal was significant in helping to avoid a court-supervised restructuring.þþIt must still be ratified by about 8,800 rank-and-file active pilots, however. That process should begin soon, and according to Paul Whiteford, head of the ALPA master executive council, should be complete by Thanksgiving.þþSo far, Whiteford said he has received positive feedback from union members on Friday's deal.þþ``This is in fact solid evidence that we are making significant progress toward cutting costs in order to avoid a court-supervised restructuring,'' Tilton said. ``The important thing here is that we have a conclusion to the negotiations despite the fact that many skeptics have been saying that this was going to be a stumbling block in our progress.þþ``We expect that others will follow in their tentative agreements here shortly, and perhaps this week.''þþJoe Tiberi, spokesman for the International Association of Machinists, said more meetings between IAM officials and management would take place in Chicago this week, but he declined to say whether a deal was near.þþ``We're not characterizing it in any way,'' Tiberi said.þþA spokesman for the Association of Flight Attendants was not immediately available to comment. The Flight Attendants recently proposed a 3.6 percent pay cut.þþPRESSING THE GOVERNMENTþþUnited has had many conversations with the Air Transportation Stabilization Board as it presses for the government to back $1.8 billion of a $2.0 billion loan. The Elk Grove Village, Illinois-based airline applied for the aid in late June but was told informally it needed more cost cuts.þþIn August, under former CEO Jack Creighton, United told union workers it wanted $9 billion in cost cuts over six years. The unions immediately balked.þþAnalysts were uncertain the new numbers would satisfy the government.þþ``While the pilot proposal adds credence to United's $5.8 billion labor package, it doesn't answer the fundamental question -- is $5.8 billion enough?...In our view, the odds of bankruptcy remain in a 75 to 80 percent range, with answers expected over the next several weeks,'' said JP Morgan airline analyst Jamie Baker in a research report.þþTilton said a grass-roots campaign to encourage approval for the loan guarantees was gaining momentum. United officials will make more formal presentations to ATSB staff this week.þþ``We are also spending a tremendous amount of time talking to our strategic partners, all of whom are stepping up to the plate to contribute and participate in our effort to restructure United out of court,'' he said. þþþ
Source: NY Times
