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United CEO Resigns Under Pressure

United Airlines chief executive James Goodwin resigned Sunday, saying it was time "for a new leader to guide the organization" which has struggled greatly since the Sept. 11 attacks.

Goodwin's resignation came two weeks ago after a letter he wrote to employees was made public. In it, he predicted the troubled airline could perish unless its fortunes were reversed.

Two unions representing United employees called for Goodwin's resignation and the company's stock fell more than 20 percent last week in the fallout from the letter.

Union leaders accused Goodwin of panicking customers and workers unjustifiably. They claimed his remarks were made to get contracted employees to agree to lower wages, gain negotiating leverage or get more government assistance.

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In a statement released Sunday, Goodwin said he was "proud to have contributed to the tremendous growth of United during my 34 years. ... United is a great company and it is the right time for a new leader to guide the organization through the challenges that lie ahead."

United is the world's largest air carrier in terms of revenue based on passenger miles. The airline flies more than 600 jets to 130 destinations in the United States and internationally.

John W. Creighton was elected to replace Goodwin by an unanimous vote of the company's board of directors. Creighton has been a member of UAL's board of directors since 1998. Earlier, he served as president and chief executive officer of Weyerhaeuser Co. from 1991 through 1997.

"Our immediate goal is to restore United's financial stability," Creighton said in a statement. "We intend to work hand-in-hand with our employees and unions to accomplish this task."

United already was in deep trouble before the terrorist attacks, suffering severely from the downturn in business travel, which it depends on more heavily than other airlines. Adding to its woes were the highest costs of any major U.S. carrier, including steep labor expenses.

The airline has laid off about 20,000 of its 100,000 employees since the attacks caused a drop-off in air travel. It also is trimming its daily schedule to 1,654 flights as of Oct. 31, down about 30 percent since the attacks.

United parent UAL Corp. is expected to post operating of losses of $500 million to $600 million for the third quarter when it reports results on Thursday. UAL stock hit a 14-year low Friday, falling 32 cents to close at $13.93 on the New York Stock Exchange.

The Illinois-based airline lost more than $700 million in the first half of the year — including as much as $116 million from the failed merger with US Airways which Goodwin proposed last year. That deal was canceled after federal regulators moved to block it.

It was surpassed by American Airlines this year as the biggest U.S. airline.

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