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United’s losses “unacceptable”
United Airlines incurred losses of $1.6 billion last year after more than two years under Chapter 11 bankruptcy protection.
The second largest US carrier reported fourth quarter net loss of $664 million, a figure described by chief executice Glenn Tilton as “unacceptable”. The airline was hit by high fuel costs and a diffuclt US domestic market during the three months.
The annual loss was an improvement on the deficit of $2.8 billion in 2003.
But chief financial officer Jake Brace said: “There is significant work still ahead. We continue to believe termination of all of our pension plans is necessary for United to successfully exit Chapter 11 as a competitive, sustainable enterprise.”
United is cutting overall capacity by three per cent but continues to see strong international results and growth potential. The fleet sixe has been reduced to 455 aircraft, 68 fewer than in August 2004 and a 20% reduction on 2002.
The airline also plans a “disciplined approach” to corporate discounts and its commercial selling process “that reflects United’s value to customers and today’s historically low prices”.
United aims to cut its cost of sales as part of savings initiatives planned for 2005.
Report by Phil Davies
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