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UAL Corporation

UAL Corporation
Public
Industry Transport
Fate Merged with Continental Airlines in 2010
Successor United Continental Holdings, Inc.
Founded Chicago, Illinois, U.S. (1968 (1968))
Defunct October 1, 2010 (2010-10-01)
Headquarters Chicago, Illinois, U.S.
Area served
Worldwide
Key people
Glenn F. Tilton, Executive Chairman, President and CEO
Revenue Decrease US$16,335 Million (2009)
Increase US$-651 Million (2009)
Number of employees
47,000 (2009)
Subsidiaries United Air Lines, Inc.
Footnotes / references
[1]

UAL Corporation is the former name of United Continental Holdings, an airline holding company, incorporated in Delaware with headquarters in Chicago, Illinois. UAL held a 100 percent controlling interest in United Air Lines, Inc., one of the world's largest air carriers, and is a founding member of the Star Alliance. It was announced on May 3, 2010 that UAL Corporation and Continental Airlines, Inc. would pursue a merger pending government approval. UAL Corporation would acquire Continental Airlines, Inc. and change its name to United Continental Holdings, Inc. (UCH). On October 1, 2010, UCH, formerly UAL Corporation, announced completion of the merger.[2]

UAL Corp. passed to its successor major operations at Chicago-O'Hare, Denver, Los Angeles, San Francisco, and Washington-Dulles International Airport. UAL's United Air Lines, Inc. controlled several key air rights, including having been one of only two American carriers authorized to serve Asia from Tokyo-Narita. Additionally, UAL's United was the largest U.S. carrier to the People’s Republic of China and maintained a large operation throughout Asia.[3]

Contents

  • History 1
  • Directors 2
  • Subsidiaries 3
  • References 4
  • External links 5

History

UAL, Inc., as the company was first known, was incorporated December 30, 1968 as a United Airlines, now its largest subsidiary, whose history is considerably longer. UAL, Inc. was the creation of then United Air Lines president George Keck, who formed the holding company to allow United to diversify.

Between 1970 and 1988 UAL, Inc. would acquire and operate the Westin and Hilton hotel chains and the Hertz Corporation car rental company, as well as a regional airline, a reservations network, and several leasing and insurance companies. On April 30, 1987, UAL, Inc. changed its name to Allegis Corporation. Many Wall Street analysts however believed that Allegis' profitable subsidiaries were worth more individually than the parent company's stock price indicated. Reacting on this sentiment, just weeks after the company changed its name, a group led by United Airlines employees moved to acquire ownership. However, the group was unable to acquire the needed financing and Allegis' management sold its non-airline subsidiaries. On May 26, 1988, Allegis changed its name to UAL Corporation, with United Air Lines, Inc. as its only major subsidiary.[4]

United Airlines employees continued the effort to buy the airline's parent company however and in 1993, the effort moved closer to realization. The Board of Directors of UAL in December 1993 agreed to an Employee Stock Ownership Plan (ESOP), where employees would agree to salary and benefit reductions as well as work rule changes in exchange for stock. Employees would have an equity stake of 55%, thus making them the majority owners of UAL Corporation. UAL became the world's largest employee-owned company.

During the mid-1990s the scheme worked well for UAL. The company was able to turn around its finances, which were weakened by the recession in early part of the decade and the divestiture of Allegis' money-making assets. In the late 1990s UAL's United Airlines subsidiary would grow to be the world's largest airline, as well as one of the most profitable.

Yet in 2000, UAL's fortunes began to dim. In April 2000, the ESOP investment period ended for most US employees, prompting United's unions to fight for higher wages. Labor issues, air traffic congestion and poor weather forced UAL's United unit to implement widespread flight cancellations in the summer of 2000, harming the airline's reputation. Additionally, UAL Corporation announced its intent to merge with US Airways Group, Inc., the operator of American airline US Airways. The deal collapsed in mid-2001, due to lack of support from the U.S. government and employees. Then came the tragedy of September 11. The company ended 2001 with a record loss of $2.1 billion.[4]

As losses continued in 2002, Glenn Tilton, a former


  • UAL Company Information
  • United Corporate Structure
  • UAL Corporation – Hoovers' profile
  • UAL Corporation – stock listing

External links

  1. ^
  2. ^
  3. ^
  4. ^ a b c [1]
  5. ^
  6. ^
  7. ^
  8. ^
  • Garvey, William and David Fisher. The Age of Flight: A History of America's Pioneering Airline. Greensboro, NC: Pace Communications, 2002.
  • The Oil Man in the Jump Seat: How Glenn Tilton is Struggling to Stop United Airlines Crashing (The Economist)

References

  • United Air Lines, Inc. (including United Cargo)[6]
    • Covia, LLC
    • Domicile Management Services, Inc. (also subsidiary of Air Wis Services)
    • Kion de Mexico, S.A. de C.V
    • Kion Leasing, Inc.
    • Premier Meeting and Travel Services, Inc.
    • UAL Loyalty Services Inc. (loyalty programs and travel clubs, including United Cruises)
    • United Air Lines Ventures, Inc.
    • United Aviation Fuels Corporation (fuel purchasing unit)
    • United Cogen, Inc. (develops and operates cogeneration and power projects)
    • United GHS, Inc. (ground handling services)
    • United Vacations Inc.[7]
    • United Worldwide Corporation
  • Air Wis Services, Inc.
  • Four Star Insurance Company, Ltd.
  • Four Star Leasing, Inc.
  • UAL Benefits Management, Inc.
  • UAL Company Services Inc.[8]

The company's subsidiaries at the time of the merger were:

UAL Corporation World Headquarters, 77 West Wacker Drive in Downtown Chicago

Subsidiaries

The directors of UAL Corporation at the time of the merger were:

Directors

However, in May 2010 United announced a full-scale merger between the two carriers. The new airline will use the trade name United Airlines with the Continental logo.

The years since bankruptcy have been marked by mixed results for UAL. The company turned a profit in 2007, yet the fuel crisis in the summer 2008, where NYMEX Light Sweet Crude reached almost $150 a barrel, pushed the company into losses. To try to put an end to UAL's decades of boom and bust cycles, CEO Tilton has been pushing for a merger with another major US carrier. Tilton has stated he believes that having larger market-share and a more diverse route network are the way for UAL to reach sustainable profitability, though many, including UAL's unions groups, have strongly disagreed. In early 2008 UAL Corporation held merger talks with American airline operator Continental Airlines, Inc. However, the deal was called off after problems in the credit markets, as well as weak support from labor groups, made an official merger impossible. UAL's United instead decided to form an alliance with Continental.

On December 8, 2009, UAL Corporation announced that it has placed an order for 25 Airbus A350 and 25 Boeing 787 aircraft, with purchase rights for 50 more of each aircraft. UAL Corp. will be the second US carrier to operate the Airbus A350.[5]

What followed would be one of the largest, longest, and most complex bankruptcy cases in US history. UAL Corporation and its subsidiaries emerged from bankruptcy protection on February 1, 2006.

[4]

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