I have been in Japan several times in recent years, but the last time I was here at the ACCJ in Tokyo was three and a half years ago & just one month after United began our Chapter 11 experience.

As you might imagine& I remember that trip very well...

United was losing more than $5 million in cash every day, we had one of the highest cost structures in the airline industry with unrealistic and uncompetitive labor agreements. We knew we were facing, at best, a period of financial uncertainty& and, certainly a painful adjustment to the new reality of the international aviation marketplace.

I came to Narita at that time for the launch of the first phase of the new Star Alliance Terminal Complex, and for the opening of our First Class Lounge and Red Carpet Club. These were long-term investments for Narita, United and Star, and I wanted to be here personally to deliver a message to our customers, our airline and airport partners, that we were steadfast in our commitment to Narita and Japan.

The journey that started then has been an extraordinary one. Much has been accomplished here at Narita due in large part to the significant efforts of the Narita Airport Authority and our partner ANA& and much has been accomplished in our company. In both cases we faced significant challenges and overcame them by commitment, and simply focusing on the work that had to be done.

United  Beyond Our Restructuring.
At United, we have completed a $23 billion restructuring, one of the largest corporate reorganizations in U.S. history. We lowered our unit costs by 20 percent, excluding fuel, and raised our productivity by 27 percent. We have used the tools available to us to create a competitive platform for the future.

We have worked hard over the last three years to reposition our company so that we can compete and succeed. We now have that opportunity, but we still have much work to do: improving service delivery for our customers; driving efficiencies and improved work processes across the entire organization; and further reducing costs.

Today, we are completely focused on realizing the potential of the enterprise that we preserved in the restructuring. I appreciate the opportunity three years later to talk about that rather than entering a court-supervised reorganization.

The future for United is as a global carrier. We compete in both the domestic U.S. market and in the international arena, and the service we provide has to create value for all of our passengers regardless of why they happen to be traveling on a particular day and regardless of what they think is fair value on that particular day.

We at United do not agree with many of our competitors in the U.S., that all airline travel should be reduced to a commodity experience, where customers seek only the lowest cost&with the barest minimum of customer service.

We know that you want choices. We know that you value different products and service for certain types of travel, and that business travel has its own set of requirements. We are intent on meeting your varying needs at different times, at prices you are willing to pay.

And, of particular interest to our many United frequent flyers here today, we know that our international premium and business product needs to be much better. Our business travelers are the heart of United and we are making an investment of more than $165 million in new upgrades in our international product that will ensure that the United experience meets your expectations &and takes United ahead of our U.S. competitors.

Focus on Asia
We have always recognized that it is the customer who determines success in the marketplace& and that in turn drives success for our investors and our employees.

Our customers value the connectivity and the global reach that United and our Star partners offer to our customers worldwide.

Preserving and, indeed, developing our international network has been a critical component of our ability to reposition United. We have led the U.S. carriers in redeploying capacity to Asia, the worlds fastest-growing aviation market, significantly increasing our service here over the last 3 years.

Today, almost 25% of Uniteds total capacity is deployed in Asia-Pacific, with Japan the largest market, accounting for approximately 50% of our capacity throughout Asia.

Our position in the region is strengthened by our alliance relationships with Japans home carrier ANA, as well as with Asiana, Thai Airways, Singapore Airlines, Air New Zealand and, most recently, Air China and Shanghai Airlines.

Our partnerships with premium service carriers such as ANA, and with airline leaders such as Yoji Ohashi and Mineo Yamamoto, is consistent with our overall customer-centric strategy& giving us increased global reach, and providing quality connectivity for our customers. We are fully committed to expanding our Asia-Pacific and our global network and offering seamless service for our customers.

New Star Alliance Terminal
This week, I am here to participate in the official opening ceremonies for the new South Wing that we are calling the "Star Alliance Terminal Complex" & just as I attended the launch of this project three and a half years ago. We all remember the terminal as it was then& overcrowded, incapable of handling the traffic at that time, and certainly not able to facilitate the traffic we foresaw for the future.

We know in this business that airports compete just as airlines compete. Over the past decade Narita had been losing ground to the significant new airport development that mirrors the growth and potential of the Asia region.

It is a difficult task to take a facility, or a company, which has known some success in the past, and reinvent it to meet the needs of a very different market environment& so that it can then compete successfully with new market entrants that do not have the confines, costs and mindset associated with a mature business. This is an experience we know something about at United.

The new terminal has been a major undertaking by the Narita Airport Authority. This was a difficult project in many ways. It is only because of the vision, leadership and commitment of Chairman Matsuhashi, Mr. Kurono and the rest of the team at Narita, that this terminal has been transformed. We thank them for their foresight and drive to get this done, regardless of the many difficulties they faced along the way.

Narita will now have a world-class international airport facility that puts it right back in a leadership position that is so important for the economic growth and infrastructure of Japan. A powerhouse in the Asian and global economies, Japan is well-positioned to compete with the emerging economies of this region.

Our good friends at ANA also played a major role in the success of this work at Narita and we thank them on behalf of United and all of our Star partners.

Our joint effort on the Star Terminal is really just the beginning. We want continue to work together to ensure that Narita maintains its position as a major international airport. We need regulatory support for practices that allow more code-share flights from Narita. At the same time, we need a continued focus on airport costs for Narita to be competitive.

...At the new Star terminal, we will truly be "moving together under one roof" to serve all of our global passengers...

Our customers deserve nothing less. The South Wing will dramatically improve the Narita travel experience for all Star travelers, making international travel easier and more convenient. And, importantly, it will facilitate more efficient movement of cargo through the airport and throughout the region.

The new passenger departure lobby is 1 1/2 times the size of the old North Wing, and Terminal 1 will become the largest airport terminal in Japan. Star customers will benefit from a superior customer experience that includes significantly reduced connection times, a choice of lounges plus a wide array of world-class shopping and restaurant options.

The spacious terminal has been designed with the industry's first zonal check-in area that serves customers by the class of travel and not by individual airline. If you are like me, you probably wondered why the industry has not done this long ago, but this is a genuine innovation. Premium-class travelers on all Star carriers will be served in an exclusive check-in area. The terminal will also offer the latest technological advances, including 126 self-service check-in units.

This is the Star Alliances most ambitious project to-date and is the largest co-location in the Star network worldwide. The new Narita complex embodies a vision of international aviation in which members of the Star Alliance are effectively cooperating to enhance efficiency and better serve our customers. The terminal with its easier connections and improved customer experience, will, as I said, make Narita more competitive in this fast developing and dynamic region.

Deregulation to Enable Cross Border Integration
We are very proud of our relationship with ANA and the competitive distinction of our Star partnership. In fact, Star stands as a model of how international alliance cooperation can work -- not only for our customers, but for the partners in driving efficiencies and cost reductions. It shows what we can do together, moving together under one roof, even in the most challenging of times.

The new Narita terminal will embody the best in alliance cooperation.

Even the most well-conceived and best-run alliance between individual airlines cannot generate the same efficiencies and synergies as single enterprises, in which duplication is eliminated and the strengths of strong but separate firms are effectively combined.

Where regulators have allowed it, market-driven integration across borders has been a success. Witness the strong performance of the new Air France-KLM combination, now the worlds largest airline measured by revenue.

Regulators constrain normal market forces with restrictions on consolidation and investment, while virtually every major international airline  from the strongest carriers of Europe, North America and Asia, to the range of new start-up operators in India and the Middle East -- seek greater efficiencies, and degrees of market stability.

To promote market stability, we at United think carriers should be able to invest in each other and to consolidate where the market so dictates, with safety and security uncompromised.

In our belief, ending artificial restrictions on cross-border consolidation has allowed other multi-national industries  including energy, banking, communications, information technology, media, automobile and pharmaceutical companies -- to achieve new efficiencies of scope and scale.

From our perspective, it is illogical that the very industry that facilitates the global operations of these other industries -- providing the indispensable infrastructure across the global marketplace, transporting people and goods across borders -- should be barred from the same practice.

It is time, in our view, to let market forces govern the international airline industry, allowing the same freedom and flexibility to compete as other truly global multinational industries.

United supports reducing restrictions on investment, and we support opening international routes and services, just as we support the elimination of marketplace distortions generally  including eliminating those that currently benefit our company in the short term.

Such change is not easy. There is always uncertainty as markets open or regulations change, and we at United dont have any illusions as to why this is difficult for those who are invested in the status quo...

But it is the market that should ultimately decide, as it does in other industries. Relying on market distortions and regulatory anomalies for short-term advantage is not a substitute for long-term competitiveness. In fact, it is a detriment to long-term competitiveness and in many instances it is an implied subsidy. It is not what we now expect to focus on after three years of our challenging reorganization.

Fortunately, as an experience borne of that reorganization, our company today has emerged stronger and more confident from our restructuring. Today we look forward to working ever more closely with our partners, serving our customers better, and competing vigorously in open markets around the world.

This company has come a very long way. We have no illusions about that either. When we entered restructuring, we were the poster child for a company within this industry that needed a restructuring. But we had the courage to own up to that obligation of ours. We certainly have much further to go. We have deserved the right to do so. From our perspective, Tokyo, three years later, is a great place to begin that journey.

Thank you.

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