United Air Lines exclusivity extension opposed by machinists' union

By Jeff Pines

Washington, Aug. 11 - The International Association of Machinists and Aerospace Workers said it opposes another exclusivity extension for UAL Corp., United Air Lines' parent corporation.

The union filed its objection with the U.S. Bankruptcy Court for the Northern District of Illinois Tuesday.

United said it needs until Dec. 31 to file a reorganization plan and until March 31, 2005 to solicit votes for the plan. The Air Transportation Stabilization Board's decision not to provide a government guarantee for United's exit financing left the company scrambling and now it needs more time to develop another plan so it can emerge from Chapter 11.

The airline's current exclusive right to file a reorganization plan ends Aug. 30, and its exclusive right to solicit votes for the plan ends Nov. 30.

The machinists and aerospace workers union, however, said various constituencies warned United to develop a back-up plan. United should have had an alternative plan ready to go.

The union said it also was "surprised and disappointed" to learn in open court that United would no longer fund pension plan contributions while it is in Chapter 11.

In United's motion, it lists a host of items to be addressed "that dwarfs what they actually have accomplished in the past 16 months," the union said. For the union, this raises the question of just what has United's senior management been doing for the last 20 months.

The union said it appears as though United has no concrete business model for exiting Chapter 11 other than not making pension plan payments.

An Aug. 20 hearing is scheduled.

United filed for bankruptcy on Dec. 9, 2002. Its Chapter 11 case number is 02-48191.

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