Two aviation giants disclosed cost-saving measures in efforts to return to financial health. United Airlines' machinists union agreed to concessions worth $1.5 billion, while
said it will cut 5,000 jobs in 2003.
Shares of United parent
were recently up 48 cents, or 16%, to $3.58, and shares of Boeing were up $1.23, or 4%, to $32.96 on the
New York Stock Exchange
United reached a tentative pact with the International Association of Machinists and Aerospace Workers union, which is made up of six union groups and 37,500 members, to take $1.5 billion worth of pay and benefit cuts. The company is trying to avoid filing for Chapter 11 bankruptcy protection and hopes the cuts will persuade the government's Air Transportation Stabilization Board to grant it a $1.8 billion loan guarantee. The union's vote on the agreement will take place Nov. 27.
Boeing said it will cut 5,000 jobs in its commercial airline division. The new cuts bring Seattle-based Boeing's total job cuts to 35,000 since the events of Sept. 11.
Half the cuts will come through attrition while the other half will be via layoffs, Boeing said. The first layoffs will be announced on Friday and go into affect on Jan. 24. The total workforce count will be lowered to 60,000.
Last month, Boeing's Shared Services division cut 1,200 to 1,500 jobs.