UAL Corp. CEO Glenn Tilton yesterday at the Merrill Lynch Global Transportation Conference said the carrier by year-end would slash at minimum 1,000 "salaried and management" positions.
Tilton said the move is part of a larger cost-cutting initiative to reduce costs by $400 million. That includes cuts to advertising and marketing by $60 million and cuts in purchased-service costs—telecom, catering, maintenance material and ground handling—by $200 million. Tilton said United Airlines is "reducing general and admin overheard expenses by some $100 million, and as a part of that initiative, we'll be eliminating at least 1,000 salaried and management positions out of approximately 9,400 by year-end."
Tilton also said the carrier would increase "operational efficiencies" to generate $40 million in savings. Such efforts include developing a new flight planning system, reducing block time and "better matching product delivery to customer needs." The carrier also said it soon would reveal its international premium product.
Following the longest bankruptcy in aviation history, United Airlines earlier this year exited Chapter 11 protection. United-like many other carriers-has spent the previous years rethinking strategy, cutting costs and generating revenue
(BTN, Jan. 23). In addition to total revenue jumping 6 percent last year amid higher capacities and fares, the company said it also expected various cost-reduction initiatives to yield $7 billion in savings annually by 2010.