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Thu, Sep 02, 2004

United's Latest Threat

Airline Says It May Cut Ten Percent Of Workforce

As bankrupt United Airlines struggles to emerge from Chapter 11 by the end of the year, a new report from the London Financial Times says the company plans to cut another 6,000 jobs -- about ten percent of its total workforce.

The newspaper reported CEO Glen Tilton planned to present the idea to his board of directors at the end of this month.

United isn't saying what it plans to do to climb out of the financial hole it's in. Spokesman Jeff Green told the Denver Rocky Mountain News, "We have said all along we're going to look at everything with regard to further cost cutting. However, no final decisions have been made about how the costs will be cut."

But a taped message from UAL management to its workers said the airline is trying to cut $625 million in annual operating costs by reducing call center, maintenance, airport operations and commuter partner agreements, according to the Denver paper.

"The savings we expect from these initiatives are a good start toward reaching the cost structure we must have, but even with this intense focus on cost reduction, it isn't enough," United COO Pete McDonald said in the message. "I know this is hard for all of us. Everyone has made sacrifices. And the truth is, it will probably become even more difficult as we go forward."

FMI: www.united.com

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