The world's second-largest airline is also dealing with a severe drop in high-paying business passengers, an impending strike deadline for its mechanics and a stock price that has fallen from $40 a year ago to close at $11.64
While most airlines were holding steady or trending positive, jitters about UA's ongoing labor troubles were keeping the sector's main indicator on the flat line.
With the company's 13,000 machinists seemingly on the verge of voting to strike, investors traded UAL to $12.18 in early trading.
UAL CORP. FELL ANOTHER $1, OR ABOUT 8.2% TO $11.39 with the news that the mechanics and cleaning crews at UA rejected a contract proposal for pay raises of up to 37%, setting the stage for a possible strike at the financially troubled US carrier.
Please see these and other related threads for details:
In another sign of just how far-ranging the strike talk reverberates, the credit rating agency Standard & Poor's noted that it will very likely also further cut ratings on UAL debt if a strike occurs!
Moody's also warned late Wednesday that it might downgrade further the carrier's already battered credit rating.
``The market is very confident about the mechanics approving the contract tomorrow,'' says Neidl, who doesn't own any UAL stock. ``It's not a given, but they would be insane not to pass it.''
<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by GGpillow: make that 18.6%</font>
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FWIW, the Dow Jones Transportation Average, which tracks the broader sector, jumped more than 5% yesterday in an overall very good day for the markets!
