United willing to fold Avolar

Answerguy

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United willing to fold business-jet venture Struggling airline tells unions unit will close unless investor found
By Marilyn Adams
USA TODAY


United Airlines CEO John Creighton has told union leaders in recent days that the company is prepared to close its business-jet venture if an investor isn't found in the next few months.

After the Sept. 11 attacks, officials at United's parent, UAL, said they were seeking a majority investor to underwrite the Avolar unit, which is marketing shares of private jets to corporate executives, professional athletes, entertainers and others who prefer private, on-demand flights.

In recent meetings with the Association of Flight Attendants and the Air Line Pilots Association, Creighton said the company would close or consider closing Avolar if no investor is found, union leaders who attended those meetings say. In a Jan. 16 meeting with the flight attendants union, Creighton said the company believes in Avolar's potential and wants to find an investor to make it work. If that doesn't happen this quarter, ''we will shut it down,'' he said, according to Bobbie Pilkington, the union's secretary-treasurer.

This week, Creighton told the governing body of the pilots union that UAL would have to consider writing off the investment if no buyer is found, union Chairman Paul Whiteford said.

Avolar CEO Stuart Oran called the reports ''moot'' Thursday because a majority stake will be sold this quarter. ''We've been working with a number of investment entities, and the process is moving exactly as it's supposed to. We want to achieve the best price, the best return for the company and a partner who shares our vision.''

UAL's management and directors saw Avolar as a potential source of revenue from passengers who don't fly commercial airlines. Avolar launched last spring in a bid to capture a share of the fractional-ownership market in business jets, which has shown double-digit growth in recent years. That business is dominated by Executive Jet, the successful corporate-jet company owned by investor Warren Buffett's Berkshire Hathaway. After Sept. 11, some union members criticized the company for spending money on a new venture when United is losing millions of dollars a day.

Avolar has firm or conditional agreements to acquire up to 306 business jets. Deliveries are to start in April. Oran said Avolar has 200 people ''in the pipeline'' who have received proposals or signed letters of intent or contracts.

Avolar's charter flights, using leased planes, have generated more than $500,000 in revenue in the last month, he said.
 

PurpleTail

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Inside sourse says the United start up Avolar program is going to fold within the next couple of months. Reason being...too many conflicting parties involved including managament,flight attendants, and pilots union, and not enough money.

On top of all that, mainline United is having serious financial problems **thats a news flash** and there future is now in question.

Good luck to those in the pipeline but it is looking like the light at the end of the tunnel just went out.
 

Chocks

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Wait a minute...

Okay hold on a second - you say "Inside source says Avolar is gonna fold in the next 2 months." Are you a furloughed UAL guy? I am, and have heard rumors galore - but that is what they are, rumors. Who or what is this "inside source". Is this from a flight attendant? A pilot? Remember, the last two big things to be announced at UAL - Avolar AND the US Air Merger - there were NO rumors leaked prior to these events. I don't believe A+ has already been "cut." If this was true, why would they wait a "couple months?" Why wouldn't they just stop investing money now. I'm leaving tomorrow to start indoc, and starting Lear 45 initial at Simuflight next Sunday in Dallas. If AVOLAR going away was a "done deal" then why would they pay 20K + for type ratings for everybody in out class. It doesn't make sense.

I have spoke to people inside Avolar, including the Chief Pilot and AVOLAR is going to continue to rise. The only recent real "news" was that the CEO of UAL said they would pull the plug if Avolar hasn't been sold by the end of the quarter. A+ already has several willing investors, they are just determining who they want to be in bed with. A+ is a complete seperate entity than UAL - there aren't any managers working both sides of the fence.

I believe A+ is going to be one of the only places hiring (To the tune of over 1300 pilots in the next 3 years) in the near future.

If you are going to post "rumors" at least cite your source a little better.

I'm off my soap box.....Chocks
 

beytzim

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Your enthusiasm is admirable, but quite unrealistic. 1300 pilots in 3 years. Please. A major airline with its training department in full swing has a hard time doing that. If Avolar hires 500 pilots in the next 3 years - you should be the happiest guy in the world.

Good luck bro.
 

Chocks

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Untrue - UAL was training over 1000 pilots in a year. Besides, Avolar isn't doing the training - they are contracting out. Simuflight can handle the load easy. Besides, each pilot doesn't require a full blown initial - Indoc is only 3 days. Who knows how many pilots they really end up hiring - they do have firm orders on jets - SOMEBODY has to fly them. (Might as well be me)

Chocks
 

Boz

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Chocks,

I appreciate and can understand what you are saying. I am fully aware of the pains of furlough and wish you all the luck along with the other thousands' of furloughees.

The rumor I have heard, and that is just that a runor! Is that UAL is in a position that they have not made the best decisions in the past. i.e. US Air merger!!! and need to sever the ties. UAL needs to cut there loses with this one early and not let it drag out any longer like things in the past. The focus is really started to hit home that they need to run UAL, and UAL only. Outside investors are in hot demand and we are not the only ones seeking them out. I hope the Avolar project does UAL some financial good. But, IMO I think it is just a matter of time before they pull the plug on this one.

Hopefully, I am wrong and you can make fun of my post! Good luck fella!

Boz
 

Gumby

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Avolar

Chocks,
Nice soap box preaching there my friend!!!
Glad to see someone else is trying to be optimistic in light of the article in USA today on friday!!! It sure as hell was'nt the brightest move on UAL or ALPA's part to print Creigtons feelings!!
It's not gonna do alot for investor confidence, but falls in line with some of the other bonehead comments in the past!!!

I have spoken to many in Chicago in the past few days,and all say that everything is on track..I'm hoping they are right.

We are actively hiring and interviewing, i.e. "Chocks", and many other folks out there...Lets keep the positive "mojo" going everyone, and have fun in DFW, Chocks!!
 

Chocks

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Thanks!! Hope to see you on campus...
 
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bigboy

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I have a strong feeling this is going to work.... by the way , I have nothing to do with United or Avolar but.... I have the same feeling that I had 2 years a go when JetBlue asked me to be in the 1st class, and at that time they didn't have a corporfate name yet....... and look at them now... doing real good and I hope they keep doing good for all of us out there........
I think Avolar is doing great "TODAY" and thats what we should judge... present and past NOT the future....good luck to all.

Keep it positive...
:cool:
 

BusBoy

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Sorry guys...... That was my posting "I have a strong feeling..............." I singed on with my brother's Name ....

Sorry,

Busboy
 

Answerguy

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Well, lets hope that this Avlor gets some business but, as a close follower to the fractional market for the last few years these are my findings. First Avlor is marketing top shelf service, ask the business traveler what kind of service they get at United? Marginal at best. When people buy a jet they expect top notch service and I don't think that United and top notch should be used in the same sentence. Just my opinion by the way. Second Avlor started out by ordering all large cabin aircraft, before the lear and Beechjet orders. When the economy was booming in 2000, the 4 fracs only sold around 50 large cabin aircraft. Third they have no money as of yet for backing. Getting something going like this takes major cash, profits would not be seen for at least a few years, real high risk. 4th, with Netjets and Flight Options controlling the market Avlor would have to offer something new or major to get a market share. Like when Flight Options started 3 years ago they offered prevously enjoyed jets for 33% less than the compition. That was their thing to get into the market.
The last poster compared this to Jet Blue. Jet Blue had more financial back up than any start up airline ever! And I have heard that Airbus will give you a fleet of airplanes with no payments for 5 years. Also Jet Blue used southwest business model.

Lets hope that United finds an investor and it works. But if one is not found EJ and Options are hiring
good luck
 

Jiminmem

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You do have to wonder if management at UAl has any brain cells at times. Does this make sense; trying to get companies to buy shares of aircraft that cost anywhere from $20-$45 million and then say were not sure if we'll even start this operation. Even if we do, were also looking for someone else to take over a major share of the outfit. So a CEO has to decide whether to shell out big bucks on a company and have no real idea if it'll ever start up or who will run it. I think United needs to get a clue.
 
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