CHICAGO, Aug. 29, 2002—United announced today several policy changes aligned with current market conditions and overall corporate objectives.

“These changes are part of United’s overall strategic plan to cut costs wherever possible, while maintaining a product that our customers have told us is important to them,” said Chris Bowers, senior vice president-Marketing, Sales and Reservations.  “At the same time, we must be sure that our products and services are priced appropriately for the value they offer.”

United’s policy changes will apply to customer upgrades; fare rules; and discounts on sale, promotional and other already deeply discounted fares.

In the fall, a number of changes will be implemented for United’s upgrade program.

“Upgrades are a major motivator for our customers,” Bowers said.  “Consistently, we receive feedback from our best customers that upgrades are too complex and not simple to use.  Today we are announcing a number of policy changes to make travel easier.”

á      United is streamlining and simplifying the markets where customers can use their upgrades, giving them greater flexibility and ease of use across United’s network.  The number of upgrade award levels has been reduced to two. (effective first quarter 2003)

á      Internationally, United is simplifying the number of miles needed for Mileage Plus Award upgrades.

á      Over time, United will move to automate all customer upgrades, similar to previously announced e-ticket initiatives.

á      As an added bonus for Premier members of United’s award-winning Mileage Plus program, upgrade clearance policies will increase to 48 hours before departure, from 24 hours.  All other upgrade clearances will follow existing time lines. (effective first quarter 2003)

á      Lastly, the monetary purchase price and miles needed to purchase upgrades will be increased effective, Oct. 1, 2002 - the first increase since 1996.  This will not affect the way that customers earn complimentary upgrades, or applicable booking codes.

Additional information regarding United’s upgrade program will be available through future communications from Mileage Plus and via the company’s web site, www.united.com.

Continuing with its cost-saving efforts, as previously announced, the company also is eliminating discounts on sale, promotional and other deeply discounted fares when negotiating contracts with corporate customers. This applies to North America and all International markets.

“While we are doing all we can to maximize revenue, the growth of low-cost competitors and the soft economy are out of our control,” says Bowers. “We believe even when the economy improves, the changes in air travelers’ habits and attitudes, and the impact of low-cost carriers, will keep revenues depressed. A continued focus on lower costs is vital to United`s future.”

More details about cost savings at www.ual.com

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