EXCERPT:

Hello, this is Larry De Shon and welcome to FLT-LINE. Today is Friday, September 27th. We’ve had a big news this week at United and I’d like to give you an update on the many recent events.

Late Wednesday, United received the union coalition’s alternative labor savings framework. The coalition has worked diligently to create constructive recommendations for addressing our company’s immediate financial needs. In a letter to Glenn Tilton, the coalition advised that it is ready to negotiate and implement a recovery program designed
to provide United with five billion dollars in labor cost savings over the next five years.

In addition to the labor savings, the coalition made other cost saving recommendations, which it believes will enable the company to improve its core annual profitability by two to three billion dollars. The company is committed to reviewing the coalition’s recommendation and will do so over the days ahead.

In other news this week, you may have heard that United is working hard to bring its strategic plan to life. The plan addresses the non-labor side of our recovery. Glenn Tilton launched a task force that will review the projects in the strategic plan, which were outlined in NewsReal July 19. As you may recall from the NewsReal and our division’s State of the Airline message, the plan focuses on six key areas: network efficiency, sales costs, air traffic, distribution, premium products and technology. The task force’s job will
be to turn the projects into cash for United. In addition to focusing on non-labor cost savings, its members will address how to generate additional revenue. The task force also will develop an implementation process for the thousands of productivity and cost reduction ideas sent in by employees through the SkyNet recovery web site.

The task force is comprised of several of United’s senior leaders. In addition, the company has enlisted the consulting services of McKinsey and Company. In a time when every dollar spent is under scrutiny, it is important to understand why we hired outside consultants. McKinsey and Company has been tasked with speeding up the implementation process of revenue-generating ideas. They bring fresh thinking to the table and can look more objectively at possible solutions. Together with United’s internal team, senior management believes that revenue-generating ideas can be implemented quickly and without historical delays.

In our own division, many flight attendants have sent in cost savings ideas to us, several of which have been implemented, and many more will be implemented in October. We continue to receive and review new ideas on a daily basis. In the meantime, we are working on a division publication, which will illustrate all of the cost saving initiatives that our division has implemented to date.