United Flying Toward Bankruptcy

By: Associated Press
By: Associated Press

Wall Street analysts say it appears all but certain that United Airlines will be forced into bankruptcy court soon. Earlier this week the airline's mechanics rejected a contract that puts its financial recovery plan in limbo as its cash reserves rapidly dwindle.

And the increased chances of a bankruptcy filing prompted a heavy sell-off of stock Friday. Shares in United parent UAL Corporation plunged $1.12, or 31 percent, to close at $2.51 in heavy trading on the New York Stock Exchange.

The airline wants to negotiate with union leaders to try to fashion a wage-cuts package that would be palatable to its mechanics. The cuts are thought to be crucial to United's financial recovery.

The machinists' union says a meeting is scheduled with United officials Sunday.

United is the largest air carrier at Denver International Airport, and has several daily flights from Colorado Springs.

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