United Waits, Delta Warns

NOTE: Shortly after we went to press and, we learned that the UAL loan guarantee request was denied by the ATSB. According to an official statement... "The Department of Transportation remains prepared to consider United's application in the event that United submits a request for reconsideration accompanied by additional financial information."

Count the stripes in the boardroom wallpaper.
Paper clip origami.
Trash basket basketball.

These are things you can do while waiting for the government to approve $1.6 billion in loan guarantees for your struggling airline.

United Airlines CEO Glenn Tilton (below, right) is, however, taking a much more active role while waiting for the Air Transportation Stabilization Board to decide on whether to grant his airline's request.

"He's in Washington one day, Frankfurt the next, Singapore the third, and back at his desk at week's end," said James J. O'Connor, a member of the board at United. "The man is positively indefatigable."

Tilton is both lobbying for the loan guarantees and shopping the world for new money in an effort to bring United out of Chapter 11. The New York Times reports the ATSB could make its decision on whether to grant the loan guarantees in the next few days.

Thursday, Tilton abruptly cancelled an appearance at a New York transportation conference sponsored by Merrill Lynch so he could race to Washington (DC) for a meeting with ATSB staff members. Last week, staffers asked United for more information on the application.

The Times reports United executives are confident that, even without federal backing, their airline can successfully emerge from bankruptcy by the end of the year. But Wall Street is skeptical.

"If United doesn't get the guarantees, Glenn Tilton had best resign, because he'll be rendered impotent in going after additional investors," said Business Travel Coalition Chairman Kevin Mitchell.

Delta To Pilots: Need For Deep Cuts Becomes Even More Urgent

In the meantime, Delta Airlines CEO Gerald Grinstein once again called for salary and benefit cuts from its pilots -- the best paid cockpit jockeys in the business.

"It is time to reengage and get the discussions back on track," he said, quoted in the Atlanta Journal-Constitution. Talks between the pilots' union and the airline stalled after Delta asked crews to take a 30-percent salary cut. The pilots are offering nine and say they'll forego a scheduled raise.

But pilot cuts alone won't save Delta, said Grinstein. Its entire way of doing business will have to change if the airline is to survive, he said.

"It is clear that Delta as it is now structured cannot survive in the marketplace. We have to completely change the way we do business," he said. "We are in an environment where we have no pricing power, yields continue to erode, and that's in the face of an improving economy."

FMI: www.delta.com