Hi, this is Glenn, and I am calling from Chicago and it's Friday the 22nd of October.

On this call I want to talk to you about how United continues to deploy our assets more effectively, identifying what the company does well and building revenue streams on these resources.  This can only be done successfully with analytical rigor and a strong focus on excellent execution.

Last week in Shanghai, senior managers and I met with United's largest corporate-passenger, MRO and cargo customers.  The event in itself was a good example of leveraging our time and assets to make the most of our work.

In attendance were a variety of freight forwarders which included several of our strategic partners such as Expeditors, Exel, Kuehne & Nagel, Menlo and DHL.  In late September Pete McDonald and I participated in an event that hosted cargo's 15 strategic partners here in Chicago.  Several of these 15 are also in United's overall top 50 list when we include corporate passenger agreements.

Many of the customers told me that they are impressed with the new level of performance they are receiving from United Cargo. They say that improved performance is reflected in the significant amount of business they are giving us -- U.S. business has increased 150 percent year over year in September.

Freight revenues, year to date, are significantly better than planned. And as I said on my last week call, Asia is booming.

United Cargo is the only major U.S. passenger-cargo combination carrier that has posted year-over-year and quarter-over-quarter increases in yield.

Many of these same top customers also told me that we, along with the other carriers, still have a significant amount of room for improvement.  Our goal is to drive our service performance above industry-leading levels.

Today on the call I have asked the new president of United Cargo, Scott Dolan, to join me to talk about how this improvement has come about and to share with all of you his expectations for the cargo business in the years ahead.

Scott came to United in May, after spending five years with Polar Air Cargo and Atlas Air, most recently as their chief operating officer.  In that capacity, Scott helped lead them through their recent, successful Chapter 11 restructuring.  Before that Scott worked many years at General Electric. Scott brought to United exactly the kind of analytical rigor that we need to fix United Cargo and that which every company has to have and certainly United has to have through all of our divisions.  He realigned his management structure to ensure personal accountability throughout United cargo operations.  But I am going to let Scott talk to you about that.  So Scott over to you . . .

Scott: Thanks Glenn.

United Cargo is a business with tremendous upside, but we were not taking full advantage of that revenue opportunity.  It is a very important opportunity because cargo's contribution goes directly to United's bottom line.  This contribution is expected to increase into 2005.

Last year, we outsourced warehousing which saved the company about 100 million dollars annually, but also produced some complications that we had to work through.

We have reorganized the team with a new head of sales and marketing, realigned the finance and strategy function and streamlined cargo employee reporting and accountability.  Instead of reporting through other divisional lines as they have in the past, all cargo employees now report directly to me and my division with a dotted line to the country managers around the world.

A full year after we outsourced warehouses we have bounced back to pre-outsourced levels of performance.

The cargo business in on the upswing.  We are having a great October, with traffic well ahead of last year.  Our freight market share among U.S. carriers has increased from 18 percent in January of this year to 22 percent in September.

We are ahead of plan through three quarters, with revenues in September up over last year. And we are expecting revenues to be up for the full year.

Freight revenues are up year-over-year, more than off-setting the declines in mail revenues, as the USPS, the post office, overall business continues to shrink and diverts business away from the combination carriers to their block space agreement with FedEx.

Much of this is due to our service improvement at our warehouses and throughout the division, but it is also due to the great job Airport Operations is doing in boarding, unloading, running and scanning cargo.  In addition, I would like to thank the entire operation. It's been doing a fantastic job with high reliability to our cargo customers. We couldn't do it without the entire team.

While 2004 is turning out to be a very good year, I will steal a line from Glenn and add, "our work is not yet done."  We are focused on continuous improvement.  We have to be if we want to continue to grow this business.

United Cargo is successfully implementing a sweeping program called Cargo Operations Process Redesign, or COPR for short, to improve all of its processes --from check-in to delivery.  COPR instills structured, consistent processes and standardizes best practices across our warehouses and ramp procedures.

In addition, we are moving ahead with plans to improve performance through implementation of Six Sigma.  Six Sigma, as many of you may know, is a disciplined, data-driven approach and methodology for eliminating inefficiency and defects in work processes.

I have hired a quality director who will lead the process improvements focusing on data analysis, external and internal benchmarking, and gathering customer and employee input.

In the coming months, we will continue to focus on yield and load factor.

Well thanks Glenn.

Glenn:

Thank you, Scott.

United Cargo is a success story for all of us at United. And it didn't happen by chance.  It took careful planning. There was difficulty involved in making the changes that were necessary, and as in every division of the company, it is execution that is making the real difference.

At United Cargo, Scott's people know that he takes responsibility for his personal actions and for those of his division.  They also know that he expects them to be accountable as well.  Together they are looking at every aspect of operations and making changes based on hard data and the insight of the people who are on the ground doing the job. That's what we mean by analytical rigor.

As Scott can tell you, this is not a "one-time fix." He and his team, through the Six Sigma process, are committed to continuous improvement going forward.

Analytical rigor, accountability, operational excellence, continuous improvement: this is precisely what we should all expect of one another at United today.

The changes we're going through at United are not easy.  You have heard me say many times, this is not a business for the faint of heart.

But as we can all see by the example of United Cargo, changes can clearly deliver results for both United and our customers--if they are as Scott just described them to you.

That's all for today.  We'll be talking to you again soon. Until then, keep your heads up, stay focused and stay united.