United Air to submit new loan application

United Airlines will submit a revised application to the federal government for loan guarantees on September 16th, chief executive…

United Airlines will submit a revised application to the federal government for loan guarantees on September 16th, chief executive Mr Jack Creighton said.

The second largest air carrier in the US is struggling to avoid an autumn bankruptcy filing.

United has asked the government's Air Transport Stabilization Board, created after the September 11th attacks, to back $1.8 billion of a $2 billion loan as costs continue to outpace revenues and the airline faces big fourth-quarter debt payments.

Initial feedback from the agency was that "broader, deeper and longer" cutbacks were needed, according to United.

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"United continues to meet with the financial advisers of each union," Mr Creighton said in a taped message to employees over the weekend. "At these confidential meetings, we've been opening the airline's books so the union's financial experts can confirm the serious nature of our economic predicament.

"Close on the heels of these meetings, we intend to submit to the union leaders United's specific recommendations for each employee group's contributions to the recovery plan," Mr Creighton added.

"We'll submit these recovery proposals to all of our unions by the end of this week."

Pilots said last week they delayed voting on a deal struck earlier this year to cut wages by 10 per cent.

Machinists, the largest union at United, have said they would review any new proposal but point out they have already given the airline the equivalent of a $500 million loan by deferring retroactive pay.