Rhapsody in red ends in largest airline bankruptcy

United Airlines will survive, but not as one of the largest, highest paying airlines in the United States. The only superlative attached to the brand now is that it will be going through the largest bankruptcy in aviation history and one of the 10 largest ever.
There are other numbers that come to mind. In the last two years, the airline lost $3.8 billion and is likely to lose $2.5 billion this year, also an industry record. The stock, which stood at $100 a share as recently as 1997, could now be bought in the Everything Under a Dollar store, if such stores sold stock.
United, an airline whose television commercials introduced a whole new generation to Gershwin's "Rhapsody in Blue," will still be flying high, even in Chapter 11 bankruptcy. For one thing, it is likely to remain the dominant air carrier across the Pacific, unless reorganization goes way off course.
Inevitable almost delayed
In some ways, the company should be thankful that it was turned down for a $1.8 billion loan guarantee last week. A quarter century of airline deregulation, complicated by a soft economy and the effects of Sept. 11 made bankruptcy inevitable.
That, of course, is not going to make the immediate future any easier for United shareholders, whose loses we already mentioned, and thousands of United employees who stand to lose their jobs in the restructuring. Many of these will be one and the same, since United is 55 percent employee-owned.
Employee ownership seemed a solution when United reorganized in 1994, but it became part of the problem because management seemed unable to make the necessary cold-blooded, dispassionate decisions about what was best for the enterprise as a whole.
Filing for bankruptcy allows United to keep operating and shields it from creditors while it tries to remedy its financial problems through wage cuts, layoffs, dumping money-losing routes and renegotiating more advantageous contracts and leases. With luck, United will be flying friendlier skies in about a year and a half.