United Airlines has suffered a setback in its quest to reduce costs sufficiently to win federal backing for a loan guarantee and avoid bankruptcy, with the International Association of Machinists deciding to split from a coalition with other unions, which was formed to come up with $5 billion in concessions. To secure a government loan guarantee of $1.8 billion, United must reach detailed agreement with most or all of its unions on the cuts. Standard & Poor's credit analyst Philip Baggaley says: "The apparent splintering of the union coalition lengthens the odds against United reaching agreement with labour in time to avoid a bankruptcy filing before large debt payments are due on 17 November and 2 December."
Source: Flight International