Pilots at UAL's ( UALAQ) United Airlines have ratified a new contract designed to save the carrier $180 million a year. In a recorded message on its Web site, the unit of the Air Line Pilots Association representing United pilots said 75.5% of members who voted supported the agreement, which becomes effective from the beginning of the year. Earlier this month, the pilots union and United had to revise an earlier agreement after the federal bankruptcy judge overseeing the airline's bankruptcy objected to some of its provisions. The judge is expected to approve the revised agreement. UAL has been operating under Chapter 11 bankruptcy protection for more than two years now and is working hard to cut costs under difficult circumstances. UAL has set a target of $2 billion in savings from labor, nonlabor and pension costs on top of the $5 billion in average annual savings it had previously announced. "Again, this pilot group has stepped to the plate and has made the responsible decision of accepting this revised tentative agreement," said Mark Bathurst, chairman of the union's Master Executive Council, in a statement on the ALPA Web site. "We understand the tremendous financial challenges facing our airline, and we have once again assumed the leadership role in guiding United toward an eventual exit from bankruptcy ... We call on the company to use the savings obtained in this agreement wisely and to apply them toward returning this airline to a financially healthy enterprise. We will be relentless and steadfast in holding management to an unprecedented degree of accountability as they have now all of the tools they claim they need to exit from bankruptcy." Members of United's flight attendants union are also expected to conclude a vote on a new contract Monday.
United faces at least one labor hurdle, though, after members of its machinists union last week rejected a proposal to cut salaries and benefits. The mechanics union, the Aircraft Mechanics Fraternal Association, said members also approved a strike. The Chicago-based carrier posted a net loss of $664 million, or $5.73 a share, including items, compared with $476 million, or $4.33 a share, in the year-ago period. Excluding items, UAL lost $553 million, or $4.77 a share, vs. $252 million, or $2.30 a share, a year ago. Operating revenue, however, rose 5% to $4.0 billion. UAL joined other major carriers in suffering a difficult quarter. Rival Delta Air Lines ( DAL) reported a larger-than-expected loss in the fourth quarter amid a sweeping turnaround plan. Both Northwest Airlines ( NWAC) and AMR ( AMR), the parent of American Airlines, also reported large losses for the quarter. Continental Airlines ( CAL) Thursday reported a smaller-than-expected loss in the quarter, as the carrier's cost-control efforts took some of the sting out of higher fuel prices and industry overcapacity.