Hello, this is Jane Allen with an update for Thursday, March 11, 2004.

This week I have updates on several topics, including Ted's performance against expectations, the shortage of handheld units for computing Buy On Board sales, and the introduction of three new United Express carriers. I also have news on the ZED travel discount program. Finally, I'll share a letter about a Boston flight attendant's efforts to help a customer resolve a problem.

First, some of you have asked for more information on how Ted is performing. The answer is: very well. Ted had an 82 percent load factor in February, which was at goal. In the Denver-Fort Lauderdale market, loads climbed to 91 percent. That's very high for a brand new market. Ted exceeded its February on-time :00 departure goal by 8 points, recorded no cancellations during February and has had no cancellations this month, as of today. As we add capacity in Ted markets, our bookings for March, April and May are matching, if not exceeding, that capacity growth. In addition, we're seeing more last-minute travelers buying walk-up fares on Ted as a result of our simplified, competitive fare structure. All of these positive steps are good signs for Ted and reflect great work by Onboard, as well as other divisions. Our flight attendants have contributed to Ted's success to date by delivering great service to customers and by generating a high level of Buy On Board sales on Ted flights. Sales on longer-haul flight segments are averaging more than $300.

On a related issue, flight attendants have identified a shortage of the handheld devices used to compute sales on mainline and Ted flights that offer Buy On Board. While our caterers purchased a full complement of the "handhelds," they are still working on improving their processes, which will enable them to turn the units for subsequent flights in a more timely fashion. The process currently is taking longer than anticipated, which causes delays in returning the handhelds to service. Unfortunately, on the small number of flights where a handheld is not properly provisioned, computation of Buy On Board sales must be done manually. In addition, this limits customer payment options to cash only. We regret the inconvenience this is causing our employees and customers, and we are working with the caterers to resolve this problem as quickly as possible. In the meantime, for those of you who normally use the handhelds, we appreciate your patience and your ability to work around this problem. Thank you for conveying our apologies to customers for this temporary situation.

As announced in NewsReal March 9, three new carriers have joined United Express. Beginning in June, Chautauqua Airlines, Republic Airlines and Shuttle America will serve our Dulles and O'Hare hubs, as well as a number of other, smaller' U.S. markets. Our partnerships with United Express carriers are very beneficial because they bring us passengers and revenue in markets we could not otherwise serve competitively and profitably. In addition to generating additional connecting traffic for the mainline, our express partners augment our service in mainline cities by flying smaller aircraft at off-peak hours. United Express contributes more than $2 billion to our annual revenues and currently accounts for more than half of our total daily departures. The three new carriers will operate 32 regional jets and 10 turbo props on behalf of United Express, all of which will be painted in the new livery. As I explained in an earlier Update message, the cost of the new paint scheme will be minimal because our aircraft will get the new look only as they come due for their regularly scheduled repainting or as we bring new regional jets into our fleet, as is the case with these United Express aircraft.

Last November, I reported that we were pushing for implementation of ZED, the Zonal Employee Discount program that will offer employees fixed-amount pleasure pass travel fares on other carriers. While we have made progress on a number of fronts, it has become apparent that we will not meet our planned first-quarter launch date. What we have accomplished thus far is getting the ticketing automation in place and getting agreement from the industry ZED committee that carriers will file ZED fares that use a common format. The carriers this week are meeting in Washington, D.C., to hammer out that common format. Once that is accomplished, United's goal is to bring the Star Alliance partners on-line first, while we negotiate agreements with other carriers. I'll continue to keep you updated on this project.

Finally, I have an example today of a flight attendant who went beyond her normal duties to assist a customer by asking for my help. In a letter to me, Boston-based Pat Haley wrote, "Dr. Ira M. Weiss, who has traveled on my flights several times between Boston and Los Angeles, has been unable to change his special meal profile. He has just achieved his 1K rating, and to assure his continued loyalty to United, we need to help him." I want to recognize and thank Pat for bringing this matter to light so that our Customer Relations department could apologize to Dr. Weiss and fix the problem. In addition, all Reservations representatives have been alerted to review with customers the content of special meals to ensure they meet the customer's needs. Pat deserves recognition for her concern for this customer and for representing United so well. It's good to know that we can count on dedicated and attentive employees like her as we work to reclaim our place in the industry.

Well, thanks for listening today. I'll talk to you again next week.