Cash-strapped UAL Corp., parent of United Airlines, yesterday said that it would "likely" terminate its four pension plans as part of its efforts to further cut costs and emerge from bankruptcy.

United's move, which must be approved by the bankruptcy court, would wipe out nearly $2 billion in future retirement benefits for many of its 120,000 retirees and workers, according to a spokesman for the Pension Benefit Guaranty Corp., the federal agency that insures corporate pension payments up to certain maximum levels.

With its hub at Washington's Dulles International Airport, United is one of the area's largest employers.

United's action would also dump billions of dollars in future pension obligations onto an already financially strapped agency. The value of the PBGC's assets on March 31 was $9.7 billion less than that of the future benefits it is obligated to pay. Termination of United's plans could push the agency's underfunding to about $15 billion.

The PBGC estimates United's pension plans are about $8.3 billion underfunded, which would make United's move the largest corporate pension default, said agency spokesman Randy Clerihue. Prior to United, the biggest default was in 2002 by Bethlehem Steel, whose terminated pension plan was underfunded by about $3.6 billion.

Clerihue said the PBGC would cover only about $6.4 billion of the underfunding. The remaining $1.9 billion, he said, would be lost.

"The size of that loss is unusual," Clerihue said. "In most of the plans we take over, the participants usually get much of what they were promised."

In a bankruptcy court filing, the nation's second-largest airline attributed its move to the effect of high fuel prices and its inability to obtain a loan guarantee from the federal government. If United terminates its pension plans, pension experts say, the airline would likely replace them with a defined-contribution plan such as a 401(k).

Defined-benefit plans were once common but have been shrinking in number. They promise a benefit based on a worker's pay and years of service. In such plans, the employer funds the plan and bears the investment risk. It also pays insurance premiums to the PBGC.

In defined-contribution plans, workers, employers or both contribute to an investment account for each worker, and the benefit is whatever is in that account when the worker retires.

United said in its court filing that it plans to examine options other than terminating the plans but that "given the magnitude of further cost reductions needed to create a viable business plan and attract exit financing, termination and replacement of all our defined benefit pension plans likely will be required."

In a termination, the agency would receive the plans' assets and become liable to pay the plans' benefits, but only up to about $44,000 a year. Pilots, who have generous pensions and must retire by federal law at age 60, would be hit particularly hard. Not only would their pension be over the PBGC limit, but they would be subjected to lower limits because they begin drawing benefits at a relatively young age -- much the way Social Security works.

The PBGC's Clerihue said it was "impossible" to determine how the move would affect individual employees, although he added that current retirees are likely to see less financial impact than workers who are nearing retirement.

United's employees have taken several financial blows during the years. In 1994, they agreed to a 20 percent cut in pay and benefits in exchange for a 55 percent stake in the airline. But United's 2002 bankruptcy filing virtually wiped out the shares' value.

When United filed for bankruptcy in 2002, employees agreed to about $2.5 billion a year in pay and benefits cuts. Now, as the airline seeks financing to emerge from bankruptcy, United workers are bracing for another round of concessions.

Last month, the airline said that as part of its new financing agreement with investors, it would not make payments into its pension plans while it remained in bankruptcy. Labor leaders and PBGC officials have claimed that move violated federal pension law.

Opponents of United's moves are expected to appear before a federal bankruptcy court judge today in Chicago. Joseph Tiberi, a spokesman for the International Association of Machinists and Aerospace Workers, which represents United's 20,000 customer service and ramp workers, said United's move was expected.

"Every action they've taken over the past month has indicated this was their goal," Tiberi said. The union has filed a lawsuit against United and has asked the bankruptcy court to appoint a trustee to oversee United's operations.

Beyond the immediate situation with United, the PBGC is greatly worried about the possibility that other older, unionized carriers will follow United into bankruptcy and try to shed their pensions -- as Arlington-based US Airways previously did with its pilots' plan.

Once these obligations are removed, the carriers have lower operating costs, which can give them an advantage in the marketplace over carriers that still have those costs.

Companies are allowed to terminate underfunded plans if they can convince a bankruptcy judge that they cannot reorganize with those obligations. However, airline executives, like most corporate leaders, tend to view bankruptcy as a last resort because of its impact on shareholders.