Chicago, Aug. 30 (Reuters): United Airlines parent UAL Corp. has said that an uncertain industry outlook led it to abandon plans to exit early from bankruptcy, and it now aims to emerge in the first half of 2004.
Executives including chief executive Glenn Tilton and chief financial officer Jake Brace had recently indicated that the world’s second-largest airline might exit from Chapter 11 much earlier than the 18 months originally projected last December, when UAL filed the largest bankruptcy in aviation history.
UAL bankruptcy attorney James Sprayregen said at a court hearing the company will submit an updated business plan to the Air Transportation Stabilization Board, but gave no timeframe.
“It still remains to be seen whether the revenue recovery will be short- or long-lived,” Sprayregen said.
Kevin Mitchell, chairman of the Business Travel Coalition and a critic of United’s tactics, said of the once-again rejigged timetable: “On one level, it's yet another data point of United's going from here to there.”
Unit revenue for the industry increased 8.1 per cent in July, boosted by a pick-up in summer travel, after improving for a couple of months. But many observers worry about how airlines will fare once demand tapers off after the US Labor Day holiday on Monday.
Mitchell said airline revenue “is going to remain anemic through a major portion of 2004.”