Glenn Tilton

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Glenn Fletcher Tilton (born April 1948 in Washington, DC) is the Chairman, President, and CEO of UAL Corporation, the parent company of United Air Lines, Inc. He has held this role since September 2002, 3 months before UAL Corp. filed for Chapter 11 bankruptcy protection. Tilton was also Chairman, President, and CEO of United Air Lines, Inc., until July 23, 2009, when he named John P. Tague as President, while retaining the role of Chairman and CEO of the UAL Corp. unit. Tilton came to UAL from ChevronTexaco.

Tilton is also Chairman of the Air Transport Association, the industry trade organization representing U.S. airlines.

Tilton grew up in Latin America, and attended high school in Brazil, where his father worked for the United States' Central Intelligence Agency. After earning a bachelors degree in International Relations from the University of South Carolina, Tilton wanted to start a career in the airline industry, but was warned against it by a family friend, the manager of the Pan American Airways Latin America Division. Tilton listened to the friend's advice and went on to follow his father's footsteps and join the C.I.A. but months before his start date, Tilton began a career in the private sector working for Texaco in 1970, servicing gas stations throughout Washington, D.C.

Tilton attained positions of increasing responsibility over the next three decades, and in early 2001 Tilton was briefly named chairman and chief executive officer before Chevron and Texaco merged to form ChevronTexaco Corporation. He was named vice chairman of the newly merged company in late 2001 and a few months later he was also named interim chairman of Dynegy, in which ChevronTexaco held a significant stake.

In September 2002, Tilton was recruited by the Board of Directors of the struggling UAL Corporation to be Chairman, President, and CEO, replacing John W. Creighton, Jr. as Chairman and CEO, and Rono Dutta as President. The board believed that an airline outsider such as Tilton could turnaround the struggling carrier. UAL Corporation and its subsidiaries filed for bankruptcy in December, 2002 only three months into Tilton's tenure.

After entering bankruptcy, Tilton, known for his dispassionate negotiating tactics, sought and achieved major reductions in employees' pay and benefits under the mantra of "Shared sacrifices, shared rewards."

Tilton then initiated a restructuring of the company outsourcing portions of the airline’s maintenance business, launching “Operation Starfish,” later to be known as Ted (which was folded late in 2008), and expanding more profitable international routes. Tilton believed that after restructuring United’s operations and negotiating lower wages, the Air Transportation Stabilization Board (ATSB) would back the airline's exit facility and allow it to emerge from bankruptcy.

Despite giving UAL management several chances to develop an adequate business plan the ATSB found UAL's final attempt still lacking. Upon rejection of the federal loan guarantee in June 2004, Tilton had limited avenues available to exit bankruptcy. The reported stance of UAL's bankers is that they would fund a non-guaranteed exit facility only if UAL's employee retirement pensions were terminated. Thus, Tilton claimed he would either have to halt operations and liquidate the carrier, or go to the unions to force termination of the airline's employee pensions so it could acquire the exit facility needed to leave bankruptcy. Tilton decided on the latter and after reaching a deal with the Federal Pension Benefit Guarantee Corporation (PBGC) to assume UAL's pensions, UAL's employee pensions were terminated and transferred to the PBGC and the company came to an agreement on an exit facility. Tilton's personal pension was protected under his employment contract with UAL.

UAL Corporation exited bankruptcy on February 2, 2006.

Tilton is controversial for his stance as a major advocate for consolidation in the airline industry. Tilton has stated he believes it is the only way to end commercial aviation's cycles of booms and busts. Since 2006, Tilton has been searching for a merger partner for United Airlines. After failed negotiations with Continental Airlines and US Airways Group, in the summer of 2008, Tilton settled on an agreement with Continental to form a marketing agreement, but not an official merger as he hoped for. The agreement is scheduled to take effect in 2009. Tilton still claims to be open and willing to participate in a merger transaction when the right opportunity arises.

Tilton continues to have a confrontational relationship with UAL's unions who feel that their shared sacrifices resulted in unwarranted management rewards. Employees were greatly affected by steep contract cuts and pension losses that occurred during bankruptcy, but Tilton received compensation officially valued at $39,700,000 in 2006, though that value has dwindled along with the value of UAUA stock on which much of it is based. In late 2007 UAL announced that it would prepay $500 million in debt in order to pay another $250 million in a "special" one time dividend payment effectively lowering the company's cash reserves by $750 million. Despite Tilton's experience in the oil business UAL has admitted in a recent SEC 8-K filing that lower fuel prices resulted in $370 million in cash losses on fuel hedges that settled in the 4th quarter 2008, as the recent fall in fuel prices drove losses on hedges put in place earlier in the year to mitigate the steep increase in prices that had occurred in the second and third quarters of 2008. In addition, the company also recorded non-cash, net mark-to-market losses on its fuel hedges of $566 million for a total loss of nearly $1 billion. In April 2009 Tilton received another 275,000 shares of restricted stock and 400,000 options with a strike price of $4.86.

In the summer of 2008 the Air Line Pilots Association's United Master Executive Council (MEC), under the leadership of Captain Steve Wallach, launched a website (www.glenntilton.com) calling for Tilton's resignation, though Tilton has stated he will not do so. Captain Wallach is also on UAL's Board of Directors. Tilton's UAL then sued the United MEC over what it called an illegal "work slowdown" and on November 18, 2008 the United States District Court issued a preliminary injunction on the Air Line Pilots Association that was upheld on appeal. Both parties have agreed to suspend the case and discovery to focus on contract negotiations.

Tilton serves on the board of directors of Abbott Laboratories and a member of the U.S. Travel & Tourism Advisory Board. Tilton also serves on the board of trustees for the Field Museum and the Museum of Science and Industry, and the board for the Economic Club of Chicago, the Executives' Club of Chicago, and After School Matters, as well as on the civic committee of the Commercial Club of Chicago and the International Relations Advisory Council of Chicago 2016.

By the end of 2008, many considered him amongst the worse CEO's of the year as Jim Cramer mentioned in his television show Mad Money. Having increased productivity of the United Airlines employees as well reduced labor cost, he was still incapable of turning a profit and losses at United Airlines were still greater than the rest of the industry. Today United Airline is said to have some of the weakest employee relations in the industry as Tilton openly voiced his disregard for employee morale.

[edit] Personal

Tilton speaks 3 languages - English, Spanish, and Portuguese. Tilton and his wife, Jackie, have two children. He lives in Chicago.

[edit] External links

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