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  • Essay / United Airlines - 515

    Question 1. The financial health of United AirlinesBased in the United States, United Airlines is one of the largest airlines in the country with more than 48,000 employees. The company has continued to provide good services to its customers and hence is growing day by day. However, according to Chicago Business (2011), the company's revenue growth is slowing every year, indicating that the company is likely to incur losses in the coming years. The company increased the tariff during the second quarter of 2011 by 9.9% due to the increase in revenues of 11.5%. The company's shares were also down 10%, trading at $22.65. This is a clear indication that the financial health of the company is in decline. In 2008, United Airlines decided to lay off 950 pilots in an effort to maximize profits. This is due to the slow growth of the economy and rising jet fuel prices. At the same time, the management also announced a reduction in the number of flights and also grounded around 100 aircraft. In the process, 1,600 people lost their jobs (Fre...