Transportation Industry

Company Watch - US Airways

AirGuide Business, July 14, 2008

7/14/2008

US Airways found itself countering allegations again today by the three-month-old union that now represents its pilots, the US Airline Pilots Association (USAPA), that its planes are flying with potentially unsafe levels of fuel. The matter became public when USAPA paid for a full-page ad in USA Today claiming pilots were being intimidated to fly with less fuel to save money. The issue was largely ignored by most news outlets Wednesday until it became the topic of Larry King on CNN, and then was widely carried by the major networks. USAPA Representative James Ray told AviationWeek the crux of the issue is that eight pilots out of 5,200 were "disciplined" by being forced to take "unapproved" training on how to determine what is an acceptable level of fuel. USAPA says the eight pilots, all international widebody captains, were not adding large amounts of fuel; one only added extra fuel 17% of the time, and the most egregious case was a pilot who added fuel 44% of the time. Ray says the union went public because individual pilot complaints and a union complaint to the FAA did not yield results. However, the union just filed its complaint last week, Ray said. Also last week, USAPA went to US Airways President Scott Kirby to complain, and promised him they would not go public if he agreed to train all of the pilots, and not just eight, according to Ray. Reported by AWST. 7/17/2008

US Airways Group took a $622 million noncash charge in the second quarter to write off the goodwill it had recorded on its balance sheet that was created by the merger of the old US and America West Holdings three years ago. It said the charge was the result of an interim period goodwill impairment test performed due to the high fuel prices "that have adversely impacted the company's business." It said it also will report an $18 million noncash charge related to the decline in value of specific 737 spares. It will announce its second-quarter results on July 22. 7/16/2008

On a recent US Airways flight from New York to Jamaica, coach passengers nursing their drinks were greeted with ads on their tray tables promoting General Motors' OnStar navigation system. Later, a flight attendant strolled up and down the aisles offering applications for US Airways-branded Bank of America credit cards. An announcement was made over the public-address system notifying passengers of the 500 extra bonus miles they'd get by signing up onboard. Reported by The Seattle Times. 7/14/2008

US Airways Group shrinking its fleet and cutting jobs to blunt record fuel prices. The reductions are part of the plan disclosed June 13, US Airways will return 10 leased jets, cancel orders for two more, pare 1,700 jobs and trim seating capacity by as much as 8% by the end of this year. Jet fuel has surged 97% in the last year. 7/13/2008

US Airways Group will drop flights to four cities in Oklahoma, Oregon and Florida. Service will end Sept. 3 to Oklahoma City; Medford, Ore.; and Panama City, Fla.; and service to Eugene, Ore., will end Oct. 1, spokesman Philip Gee said Friday. 7/13/2008

US Airways Group said June consolidated passenger RASM rose 2%-4% year-over-year. It flew 5.86 billion RPMs, down 0.6%, against a 0.6% increase in capacity to 6.95 billion ASMs. Load factor fell 1 point to 84.4%. 7/9/2008

US Airways will remove IFE from domestic flights this fall in order to save approximately $10 million per year, VP-Sales and Marketing Travis Christ told Bloomberg News. "We simply can't afford to do it anymore," he said. Bloomberg reported that video systems aboard US's A320s will be shut down Nov. 1 and removed from aircraft during maintenance. It said passenger demand has dropped (US charges $5 for headsets) and the IFE systems can add some 500 lb. to each aircraft. 7/9/2008

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