United Airlines' stock jumped 20 percent Monday after the struggling carrier announced the latest in a series of steep cost reductions aimed at keeping it out of bankruptcy court.
Also Monday, United said its salaried and management employees will take cuts contributing $1.3 billion in savings to its $5.8 billion package of financial cutbacks over 5 1/2 years.
Despite the actions, it's still unclear whether United will be able to avoid the Chapter 11 bankruptcy protection filing it has warned of repeatedly because of impending debt payments and continuing cash losses of more than $7 million a day.
Investors, however, signaled increased hope that the latest moves including plans for 9,000 more job cuts have helped United's chances of receiving a critically needed $1.8 billion government loan guarantee.
Shares of United parent company UAL Corp. rose 59 cents to $3.54 in morning trading on the New York Stock Exchange.
United announced Sunday that it will drop from its current 83,000 employees to 74,000 over the next year, retire 49 of its larger aircraft and reduce its flight schedule by another 6 percent - steps it said would return it to profitability in 2004.
On Monday, in addition to disclosing details of the salaried and management employee cuts, United said it hopes to reach a tentative agreement soon with the International Association of Machinists. IAM groups representing mechanics and ground workers are the latest major unions not to agree to reductions as part of the $5.8 billion in targeted cuts.
The moves announced Sunday, along with the earlier 18 percent pay reduction accepted by United's pilots, are part of a restructuring plan tied to the carrier's effort to return to profitability.
The airline has already cut more than 17,000 jobs since the Sept. 11 terrorist attacks.