CHICAGO, Sept 17 (Reuters) - Shares of UAL Corp. (NYSE:UAL - news), the parent of United Airlines, were down $12.58 or about 41 percent to $18.24 on the New York Stock Exchange shortly after opening.
I think a bunch of numbers have been thrown around. The $2.5 billion figure has been mentioned as a potential amount for a direct grant to the airlines. And then there's also been talk of gov't loan guarantees for something up to about $20 billion. Sometimes the $20 billion is mentioned as the sum of the grant plus loans guaranteed.
Was watching TV and saw a report on CNN saying one of the airline proposals was $5 billion grants, $8 billion tax relief, and $11 billion loans guaranteed, if I remembered correctly.
"An airline executive who refused to be identified predicted that the industry would need $24 billion in direct grants to sustain it over the next few months. Another said $2.5 billion in grants and $12.5 billion in loan guarantees would be enough for a start."
UAL Corp.'s UA will lay off 20,000 employees or 20 percent of its workforce in the wake of reduced travel demand after the crash of four hijacked planes last week, CNN reported on Tuesday.
United said it would not confirm the report, noting it just held a memorial service for employees lost in the crash of two of its planes, one into the World Trade Center and one into rural Pennsylvania.
``There will be no announcement today,'' said spokesman Andy Plews.
Herb Hunter, spokesman for United's Air Line Pilots Association, also said he could not verify that information.
``I have no confirmation of that and my sources say that the decision hasn't been made,'' Hunter said.
Frank Larkin, spokesman for the International Association of Machinists, representing 44,000 workers, also said he could not confirm the report.
United, based in Elk Grove Village, has about 100,000 employees. It announced a 20-percent schedule reduction over the weekend. If it moved in line with other carriers announcing layoffs, 20,000 layoffs would equal the 20 percent schedule cutbacks, Larkin said.
United Airlines Announces Red Carpet Club Closings
18 Sep 2001, 04:41 PM, EST
United Airlines has announced that the following Red Carpet Clubs have been temporarily closed:
Atlanta Red Carpet Club
Cleveland Red Carpet Club
Indianapolis Red Carpet Club
San Francisco North Terminal Mezzanine Red Carpet Club
United apologizes for any inconvenience resulting from these temporary closings - and will post updates on this website when the clubs have been reopened. United encourages its customers to enjoy its 47 other Red Carpet Club locations worldwide.
Location: United 1K. Hilton VIP Gold. Starwood Gold.
Posts: 343
Just saw on TV news the figure the airlines are asking for is $50 BILLION and the President is said to have received this request with a "sympathetic ear". By no means a done deal, but man that is serious bucks right there.
avgas, perhaps the reports you've seen are in a different currency? I'd also note that much of the requested $24 B is in the form of loan guarantees. The true economic value of a $1 loan guarantee is a fair bit less than $1.
I'm looking forward to what exactly a "loan guarantee" means. There is no doubt the airlines need help from the government. On the other hand, even without last week's tragedy, the airline industry was on shaking footing and some airlines were going to have to file for bankruptcy protection anyway.
Anyone recall what the terms of the US government's help to Chrysler was?
