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United Airlines Will Lay Off 2,800 Workers : Reductions: Carrier will also seek union concessions, cut executive pay, end some flights. O.C. impact is not spelled out.

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From Times Staff and Wire Reports

United Airlines said Wednesday that it will lay off 2,800 employees, cut executive salaries by 5% and seek union concessions in the latest round of cutbacks in the money-losing airline industry.

United also announced a hiring freeze and said it will reduce its domestic schedule and cancel plans for some new international routes. The job cuts, to be implemented this month, amount to 3.3% of United’s 83,600 employees.

The company said the plan will reduce its yearly expenses by $400 million.

A spokesman for United said the carrier cannot tell yet whether the layoffs will affect its operations at Orange County’s John Wayne Airport, where it is the third-largest scheduled commercial carrier.

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Airport spokeswoman Courtney Wiercioch said Wednesday that United officials have not indicated any plans to reduce the carrier’s presence in Orange County, where it has 18 daily flights.

Airport and United officials are scheduled to meet today to discuss the new allotment of jet flights at the tightly controlled airport. “So far the indication is that, like always, they want everything they can get,” Wiercioch said.

In addition to aircraft and ground crew members who live in Orange County and work at various Southern California airports the airline serves, United has several dozen employees at its two ticket offices in Anaheim and Orange, its check-in counter and baggage handling center at John Wayne Airport and a freight facility in Costa Mesa next to the airport.

United also said Wednesday that its parent, UAL Corp., expects to post a large loss for the fourth quarter of 1992. In the first three quarters of last year, UAL had a net loss of $165.9 million, it said in a statement.

United’s moves follow efforts throughout the airline industry to reduce costs after a year of rampant fare cutting and huge losses.

“Although our major competitors already have implemented substantial reductions in personnel, we have long hoped we could avoid such an eventuality,” said Stephen M. Wolf, United chairman and chief executive.

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Wolf said United was forced to cut expenses to cut losses and ensure the company’s long-term viability.

United’s stock closed down $1.125 a share Wednesday at $123.875 at the end of after-hours trading on the New York Stock Exchange.

Analysts said investors may be worried about the size of the fourth-quarter loss, which is expected to accompany a huge write-off for the estimated cost of retirees’ health benefits.

United, the second-biggest U.S. carrier after American Airlines, had a 1991 net loss of $331.9 million.

The company did not identify the flights to be dropped from its schedule, but it said it will ground 40 of its older jets this year.

United said all company officers and “affected members of U.S. management” will take a 5% pay cut. Spokesman Joe Hopkins said he could not say how many management-level employees will be affected.

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Other employees, most represented by unions, will be asked to make similar concessions, the airline said.

Plans to hire 1,900 people in 1993, including 250 flight attendant trainees, have been canceled.

Local leaders of the unions representing United employees--the Assn. of Flight Attendants, the Air Line Pilots Assn. and the International Assn. of Machinists and Aerospace Workers--planned to meet today to plan their responses to the company’s call for concessions, said Diane Tucker, president of United flight attendant group.

“At this point I don’t think we would be receptive to any kind of pay cuts,” she said on behalf of the flight attendants.

A pilot’s union spokesman said he could not comment on the cuts because he did not know how they would affect members. The machinists said no one was available to comment on United’s actions.

Last month, United announced that it had entered negotiations with Boeing Co., its principal aircraft supplier, to significantly reduce its orders and options for 433 planes.

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Times staff writer John O’Dell contributed to this report.

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