When weighing the fallout from United Airlines’ bankruptcy, most people think about the pilots, flight attendants and mechanics.
Few consider Bob Thompson, United’s wine adviser.
As the airline expanded into a global carrier in the mid-1990s, Thompson’s consulting arrangement with United became more like a full-time job, sampling hundreds of wines and scouting wineries around the world.
But then United’s expansion peaked. The economy cratered. And the terrorists attacked.
Along with idle planes, United was left with a stockpile of wine. Today, Thompson’s services are barely needed.
“I’m probably down to about two hours a week,” Thompson said.
From a wine taster in Napa Valley to a Boston-based flight attendant to a United retiree in Elk Grove Village, nearly all of the airline’s 83,000 employees and contractors have been affected by the company’s plunge into bankruptcy.
Anxiety over losing jobs and retirement benefits is soaring. Christmas orders are being canceled. Spouses are returning to work.
As United tries to salvage the airline in bankruptcy court, we take snapshots of six people emotionally and financially linked to the outcome: a mechanic, a pilot, a flight attendant, an executive, a retiree and, finally, a wine adviser.
THE MECHANIC
Pay raise and job could vanish
After eight years of having his salary stuck at $50,000, mechanic Mike Carr saw his pay soar to $72,000 earlier this year after his union struck a new deal with United.
Carr recently traded in his 1989 Ford Taurus for a 2002 Dodge truck, but he expects his raise to evaporate along with the value of his United shares, which fell from $120,000 to less than $3,000. He fears his job may soon disappear too.
“It’s pretty hard to go Christmas shopping if you think you’re not going to have a job in the coming year,” said the 39-year-old Carr, a 16-year employee.Carr’s family already lives modestly. They only take vacations to see extended family. Plans to purchase a larger house were halted years ago.
“It was sad, ” Carr said. “To see a company go from the high to the low so quickly and there wasn’t anything you could have done about it.”
Looking back, Carr regrets not being able to add to his 12-year-old daughter’s and 9-year-old son’s college funds. Using tax refunds from the years each child was born, he invested a total of $1,500 in mutual funds for his children.
Now he’s not even counting on having money from his pension.”It’s really underfunded,” said the Hanover Park resident.
Carr is trying to keep his anxiety and frustration about work from infecting the family, but his children sense something is wrong. His daughter recently asked Carr’s wife if he would return to the midnight shift.
“I promised my wife I wouldn’t come home and talk about it, but how can you not?” Carr asked.
THE PILOT
Regrets? A few, plus tension about pensions
Capt. Wright B. George’s voice fills with wonder when he talks about guiding planes into London or Paris or Beijing.
Yet if the 59-year-old pilot could travel back in time, he said he would have become a banker.
George has worked at two airlines: the now-defunct Eastern Airlines and the now-bankrupt United.
“Given the Eastern experience and the United experience, I would not choose this as a career again,” he said.
George began flying with the Air Force, running combat support routes in Vietnam. After the war, unable to find a piloting job, he went to Harvard Business School. For several years he worked as a banker when Eastern furloughed him.
Now less than a month away from turning 60, the mandatory retirement age for pilots, George is angry about his forced retirement, angry that the government didn’t save United and angry that the airline’s management and employees couldn’t reach a resolution themselves.
“It was silly,” he said. “They’ve learned nothing from history.”
George doesn’t really plan to retire.
His Eastern pension was cut from about $1,500 a month to $900 a month and he fears his expected $2,400 a month United pension may be similarly reduced.With two kids in college to support, George said he will soon start sending out resumes. While he would prefer to return to banking, “I may become a greeter at Wal-Mart,” he joked. “I need a job.”Still, George has kept a healthy perspective on the situation.
When a 38-year-old first officer told George he wished he could switch roles and retire, George responded, “Don’t wish your life away. I wish I was 38.”
THE RETIREE
Health insurance costs could quadruple
When James Petri retired from a 36-year career at United in February 1997, the company’s stock was approaching $60 on its way to $100. The salary-for-stock swap made by Petri and United’s other employees looked like it would pay off.
“I should have sold it all then, but everything seemed to be going OK,” said Petri, who was a manager of technical support before he retired. “I figure I’ve lost $120,000.”
The 68-year-old Petri still lives in Elk Grove Village, less than five miles from United’s headquarters. He has lunch with former colleagues a few times a year and shares their sense of frustration.
All of the extra work, the nights and weekends, now seem fruitless.
“The whole thing to me is like a punch in the stomach,” Petri said. “There’s a lot of really good people out there.”
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Petri started working at Capital Airlines in 1952, loading bags at the Milwaukee airport. United acquired Capital in 1961 and he stayed on.
While not concerned about his pension, Petri is worried about health coverage for himself and his wife.
If United wereforced to liquidate, Petri could lose his group medical benefit. That would quadruple his monthly health insurance costs from $150 to as much as $600.
Looking back, Petri said he often questioned moves made by management, as did many other United employees and retirees.
“At the time you think, `Do they know something I don’t?'” he said. “Obviously, they didn’t.”
THE FLIGHT ATTENDANT
Paycheck to paycheck, and loan to loan
Sixteen days after the terrorist attacks, President Bush spoke in patriotic themes at O’Hare International Airport to 5,000 airline employees and their families.
Flanked by a pair of United and American Airlines planes, Bush pledged government support to help the airline industry rebound.
United flight attendant Sara Dela Cruz saw the event on television from Boston’s Logan Airport. As she watched, Dela Cruz remembered her personal loss.
Several close friends and colleagues were on the second plane that struck the World Trade Center towers. She had worked the same Boston-to-Los Angeles route a few weeks earlier.
“Everyone in Boston asked themselves, `Why wasn’t I on that flight?'” Dela Cruz said.
Fast-forward nearly 15 months.
The 29-year-old Dela Cruz has sold her car and canceled orders for several family Christmas presents.
“I have to live paycheck to paycheck,” said Dela Cruz, who is based in Boston but as spokeswoman for United’s Association of Flight Attendants often works at the union’s Rosemont headquarters.
“I have student loans to pay off.”
Dela Cruz now thinks the federal board that rejected United’s request for a $2 billion bailout acted in an “anti-patriotic” way.
“The employees did what they needed to do,” she said. “And President Bush did not come through on his statement that we would all get through this together.”
THE WINE ADVISER
Once flush with work, job slows to trickle
Just before the Sept. 11 attacks, United ordered its wines for 2002.
The selections were mainly the work of Bob Thompson, who started off by sampling hundreds of wines from around the world.
Thompson started as one of several wine advisers to United in 1981.
He became the airline’s sole adviser a few years later.
When the company began calling wineries for samples in the early 1980s, about 40 arrived. That figure grew to 1,000 in recent years.
Thompson, a 68-year-old author of books and newspaper columns about wine, was responsible for building a rotation of reds and whites, including regional wines, for all of United’s routes.
His work began to level off and descend when United stopped expanding in the mid- to late 1990s, although an acquisition of U.S. Air announced two years ago looked like it would boost his workload.
“We were deep into the planning of what to do” before that deal died last year, Thompson said.
He doesn’t expect United to pull back its wine program, particularly because it mainly serves the airline’s valuable first-class and business-class passengers.
“I have some assurances that they’re serious about keeping relationships with suppliers,” he said.
But for now, Thompson’s work for United is limited.
“When they need more wine,” he said, “it will get busier.”
THE EXECUTIVE
Employees’ support makes it easy to fight for survival
When Peter McDonald visited United’s Indianapolis maintenance center last Tuesday, a day after the airline filed for bankruptcy, the executive could identify with the center’s younger employees.
United’s senior vice president for operations, one of the company’s top four executives, started out as a baggage handler at the airline while in college.
Seeing these people, McDonald said, “really drives you to do the right thing to try to save this company.”
Promoted to his position in October, the 51-year-old McDonald oversees departments that include 70,000 of United’s 83,000 employees.
McDonald tries to deflect employees’ anger about the airline’s problems by asking them not to dwell on the past, but he is realistic about its predicament.
“This is the most challenging time we’ve had in our 76 years,” said the 33-year United veteran whose wife is a flight attendant at the airline.
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Still, McDonald said United CEO Glenn Tilton, who joined the company in September, has made inroads with the unions.
And McDonald said he’s seen a surge in employee support since the bankruptcy filing. He was greeted by 150 e-mails from employees on Friday morning.
“The tone of these e-mails is about saving the company,” he said.
McDonald said competitors’ efforts to derail United’s application for a government loan guarantee will backfire in one important way: “It has really energized our employees to focus on the competition.”