United Airlines said late Friday it will need about $500 million in annual cost cuts above the $655 million now in the works and also received court approval for more time to develop a reorganisation plan without interference from creditors.
The amount of added annual cost cuts is still an early assessment, Jake Brace, United's executive vice president and chief financial officer, told reporters after a court hearing in Chicago. United, a unit of No. 2 US air carrier UAL Corp, has been in bankruptcy protection since December 2002. The current cost-cutting plan focuses on maintenance, airport operations and distribution.
The assessment assumes fuel prices at about current and forward levels, and that industry revenue will remain weak for the rest of the year, Brace said. It does not take into account the potential impact from pension cost savings.
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