CHICAGO, Dec. 13 (UPI) -- More than 200 unsecured creditors of bankrupt United Airlines Friday sparred for a spot on the influential committee that will represent them during the airline's expected 18-month reorganization.
A federal trustee began forming the creditors committee in the ballrooms at the Sheraton Chicago Hotel & Towers. Creditors, ranging from bondholders and banks to aircraft maker Boeing Corp. are owed a combined $20 billion.
UAL Corp., the parent of 68-year-old United Airlines, filed for Chapter 11 bankruptcy protection Monday listing, $22.8 billion in assets and $21.2 billion in liabilities.
United has lost more than $4 billion in two years and may post $2.5 billion in red ink for 2002.
UAL stock has steadily gained since the filing, selling at $1.79 a share at midday on the New York Stock Exchange -- up 64 cents since Monday -- an indication investors think the world's second-largest airline will successfully restructure.
United's business plan calls for creation of a new low-cost carrier catering to leisure travelers that would take on the profitable Dallas-based Southwest Airlines. The unnamed subsidiary would begin flying next year, operating Boeing 737 and Airbus 320 aircraft on point-to-point legs without plane changes at hubs or layovers. The Air Line Pilots Association said United plans to revive its West Coast Shuttle by United, which operated from 1994 to 2001.
"As part of our commitment to work collaboratively with United to restructure the company and forge a competitive offering in the industry, we're open to the idea of a shuttle, and we'll evaluate the opportunities this concept presents," Paul Whiteford, a 24-year United pilot and ALPA representative on the board said in a statement to The New York Times.
Delta Airlines plans to operate a similar no-frills service on the East Coast.
United must make quick cuts in labor and operating costs to keep its $1.5 billion in debtor-in-possession financing. Chairman, President and Chief Operating Officer Glenn F. Tilton said the airline was losing between $20 million and $22 million a day but would continue to operate nearly 1,800 daily flights through the holiday season.
Tilton, who took over United three months ago, met with employees at O'Hare International Airport Thursday as company officials discussed more wage and benefits concessions with union leaders for the first time since the bankruptcy filing.
United had reached tentative agreements for nearly $5.2 billion in givebacks from its union before the bankruptcy. Only a local of the International Association of Machinists and Aerospace Workers balked at $700 million in concessions before the Air Transportation Stabilization Board rejected a $1.8 billion federal loan guarantee.