United Airlines' workforce to take flight in operations center's move to Willis Tower

August 05, 2009|By Julie Johnsson and Hal Dardick, TRIBUNE REPORTERS



The deal will bring Chicago an infusion of white-collar jobs that should help spur spending downtown and investment in housing within the city. Landing United's administrative and operations staff would add more new jobs downtown than the employment that resulted from relocating to Chicago the corporate headquarters of Boeing, United's parent UAL Corp. and MillerCoors combined.

Officials for United and the city wouldn't confirm any details of the airline's move, its incentive package or the timing of an announcement.

United also explored moving to Rolling Meadows, and City Manager Sarah Phillips said Tuesday that the municipality hadn't been briefed on United's decision. "We've not been in communications with them."

On Monday, United executives explained why they made the potentially controversial call to uproot the airline's operations after more than a half-century on a corporate campus about 2 miles from O'Hare International Airport, the carrier's largest hub.

The decision is driven by simple economics, said Joseph Kolshak, senior vice president for operations at United. The cash-strapped airline estimates it would spend as much as $50 million to upgrade its Algonquin Road operations center in Elk Grove Township as it streamlines its business and centralizes those responsible for keeping its planes in the air.

Instead, the nation's third-largest carrier decided to take advantage of a stagnant real estate market to seek low rent from landlords willing to deal and aid from municipalities eager to spur economic growth.

"The going-in proposition is that we aren't going to provide a lot of upfront cash to do it," Kolshak said. "I believe the solution we're going to announce is going to be very attractive."

United is drawing fire from aviation experts who question why it would locate its nerve center in a building identified as a potential target of terrorists.

"I think we're all nervous about it," said aviation consultant Darryl Jenkins. "If your operations center goes down and you don't have a backup, you're out of business."

Kolshak said that United survived a fire to its operations center about a decade ago without major incident. It plans to keep its existing center as a backup facility and also has another, smaller command center as a third line of defense.

"One building, God forbid there's a fire or some type of incident, isn't going to shut the airline down," he said.

Meanwhile, United's financial aid likely will be examined by City Council members. Ald. Robert Fioretti (2nd), whose ward includes the Willis Tower, declined to discuss any specific incentives that might be offered to United. But he did confirm talks are under way.

"The final numbers haven't been presented to me," Fioretti said, adding that they need to fall under "very strict scrutiny" to ensure the resulting economic benefits of a United move are greater than any incentives provided.

He also said incentives would come out of the tax-increment-finance-district fund.

United's move into the city is emblematic of the carrier's transformation, as it has struggled to remain aloft this decade.

The carrier's workforce has shrunk by half since 2000, when it could boast of being the world's largest carrier. At Elk Grove, low-rise office buildings that were packed with workers prior to the Sept. 11 attacks, when employment peaked at 4,312, are 60 percent full today.

United's 300-person operations center, though, is overflowing as the carrier for the first time brings together employees responsible for its every operational facet, from continually tracking its 363 planes, finding pilots for flights to minding stranded passengers, all while coping with storms, maintenance problems or other disruptions that can ground planes.

At its new center, United plans to group these people into teams for each type of aircraft it flies. Doing so should make it easier for staffers, currently sitting on opposite ends of a huge room, to share information and craft solutions when something goes awry, said aviation consultant Robert Mann.

"If we can upgrade or improve our operations and, therefore, our customer service, let's face it, one of the biggest beneficiaries is O'Hare Airport," said Don Dillman, vice president for United's operations control center.