12/22/02 US Airways News

C

chipmunn

Guest
[DIV class=body-head][FONT face=Times New Roman][FONT size=3][STRONG][SPAN class=headline]US Airways lays out plan for return[/SPAN][BR][SPAN class=deck]Major hurdle: $3.1 billion pension liability[/SPAN][/STRONG][BR][SPAN class=byline]TED REED[/SPAN][BR][SPAN class=creditline]Staff Writer[/SPAN][BR][/FONT][/FONT][/DIV][BR][FONT face=Times New Roman size=3]US Airways unveiled its final plan of reorganization Saturday, a key step toward emerging from bankruptcy court protection.[/FONT][BR][BR][FONT face=Times New Roman size=3]Now the airline must negotiate with regulators on what to do about the $3.1 billion liability in its pilots' pension plan. It must also secure a federal guarantee for $900 million in loans, and persuade employees to approve new contract terms.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan is solid, said David Bronner, chief of Retirement Systems of Alabama, which will hold controlling interest in the airline when the bankruptcy case ends. But we have more hurdles.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan, which reduces costs by $1.8 billion annually, reiterates US Airways' intention to emerge from bankruptcy court protection by March 31. US Airways said it remains committed to Charlotte, a medium-size city with a big city airport only because it is the site of the airline's busiest hub.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan brings more regional jets into Charlotte/Douglas International Airport. It also encourages US Airways passengers to fly on United Airlines flights to the west, Asia and Latin America, through a partnership that took effect last month.[/FONT][BR][BR][FONT face=Times New Roman size=3]US Airways employs 6,869 workers in Charlotte and operates 460 daily departures to 108 nonstop destinations, accounting for more than 90 percent of the flights at Charlotte/Douglas.[/FONT][BR][BR][FONT face=Times New Roman size=3]Like other airlines, US Airways continues to suffer from the combined impact of a slow economy and a reluctance to fly following the Sept. 11 terrorist attacks. United, the second-largest carrier, recently followed US Airways -- the seventh largest -- into bankruptcy court protection .[/FONT][BR][BR][FONT face=Times New Roman size=3]As the airline industry pares down in size and re-examines its pricing structure, some experts see an emerging trend toward lower business fares and higher leisure fares. The trend could benefit Charlotte business travelers, who pay some of the highest fares in the country.[/FONT][BR][BR][FONT face=Times New Roman size=3]In an interview, Bronner said US Airways' most critical immediate problem is to work out a solution to its pension issues with the Pension Benefit Guaranty Corp., the government agency that oversees pension plans.[/FONT][BR][BR][FONT face=Times New Roman size=3]US Airways has fallen behind in funding its pilot pensions because of poor stock market performance and reduced interest rates. Pilots have agreed to lower pension benefits, but it is unclear whether their agreement fully addresses the PBGC's concerns.[/FONT][BR][BR][FONT face=Times New Roman size=3]We have done everything humanly possible, and so have employees and management, Bronner said. But now a Pension Benefit Guaranty Corp. solution has to be gotten. We don't have the PBGC people on board yet. We are working to try to get there.[/FONT][BR][BR][FONT face=Times New Roman size=3]If the airline can work out a solution to its pension plan issues, it should be able to secure federal loan backing, already conditionally approved by the Air Transportation Stability Board.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan, filed late Friday in Federal Bankruptcy Court in Alexandria, Va., said the airline expects a pre-tax loss of $229 million in 2003, but will gradually improve to pre-tax income of $587 million in 2009. The ATSB loan would be repaid in 2009.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan also spells out the revised structure of a 15-member US Airways board and of its ownership group. Alabama Retirement Systems would have eight of 15 board members and hold 36.6 percent of Class A stock and 100 percent of class B stock.[/FONT][BR][BR][FONT face=Times New Roman size=3]Under the plan, existing shares of US Airways stock will be wiped out. In a statement, the airline urged investors to use caution in existing and future investments in its existing shares. The shares continue to trade, closing Friday at 44 cents.[/FONT][BR][BR][FONT face=Times New Roman size=3]US Airways has said it will continue to focus on its hubs in Charlotte, Philadelphia and Pittsburgh, and on three key airports: New York LaGuardia, Washington National and Boston Logan.[/FONT][BR][BR][FONT face=Times New Roman size=3]It will seek to improve revenues by operating more regional jets (230 by 2006) and through the United partnership, which is expected to improve revenues by $100 million to $150 million annually.[/FONT][BR][BR][FONT face=Times New Roman size=3]Also, US Airways has cut its supply of airplanes and seats, hoping an economic recovery will jump-start demand for travel.[/FONT][BR][BR][FONT face=Times New Roman size=3]Reducing capacity represents an effort to eliminate the need to attract passengers with heavily discounted leisure fares, said veteran aviation consultant Morton Beyer.[/FONT][BR][BR][FONT face=Times New Roman size=3]In some cases, adding regional jets serves to reduce capacity. Charlotte is pretty much the (main) hub of US Airways and I think that as long as they have a monopoly, they will try to maintain fares, Beyer said.[/FONT][BR][BR][FONT face=Times New Roman size=3]At the same time, however, airlines have been experimenting with an effort to increase leisure fares and reduce the high level of business fares, sold to travelers who fly weekdays on short notice.[/FONT][BR][BR][FONT face=Times New Roman size=3]Beyer said US Airways will likely join in that effort, which appears to be working.[/FONT][BR][BR][FONT face=Times New Roman size=3]During the bankruptcy case, Alabama Retirement Systems is lending US Airways $500 million, which will be repaid with the loans guaranteed by the ATSB.[/FONT][BR][BR][FONT face=Times New Roman size=3]Following the bankruptcy, the retirement fund is making a $240 million investment in the airline: its shares are in return for that investment.[/FONT][BR][BR][FONT face=Times New Roman size=3]US Airways filed the plan after securing $200 million in concessions from unions during three weeks of negotiations that concluded late Friday. Unions made the new concessions after providing $840 million in concessions last summer. Aircraft lessors, management employees and vendors are also making concessions.[/FONT][BR][BR][FONT face=Times New Roman size=3]Negotiators agreed reluctantly to the cuts, which include reduced health benefits and turning over union jobs to subcontractors, because they feared the airline could shut down without them. But in most cases, union members still have to vote to approve the cuts.[/FONT][BR][BR][FONT face=Times New Roman size=3]The airline said Saturday that quick ratification ... is critical because the plan's assumptions include the reductions, and the ATSB won't approve a plan that doesn't assure loan repayment.[/FONT][BR][BR][FONT face=Times New Roman size=3]The plan lays out a liquidation scenario, which could include changing the Chapter 11 bankruptcy to a Chapter 7 bankruptcy. The airline said those details are provided only because they are required under bankruptcy law and because they demonstrate that creditors get more money if the airline continues to operate.[/FONT][BR][BR][FONT face=Times New Roman size=3]While US Airways' wholly owned subsidiaries US Airways Express carriers also filed for bankruptcy protection in August, the airline said they will not necessarily emerge at the same time unless they reach cost-saving labor agreements.[/FONT][/SPAN][!-- end body-content --][!-- begin body-end --][BR]
[DIV class=body-end][BR]
[DIV class=tagline][/DIV][/DIV][/SPAN][STRONG][FONT face=Times New Roman size=3]US Airways files reorganization plan - Bankruptcy proposal follows new concession from unions[/FONT][/STRONG][BR][BR][FONT face=Times New Roman size=3]ARLINGTON (AP/MSNBC.com) - US Airways Group announced Saturday that it had filed a proposed reorganization plan that hinges on the airline’s securing a $1 billion federal loan guarantee, a $240 million investment from the Alabama state pension fund and pay givebacks by the airline’s employees. [/FONT][BR][BR][FONT face=Times New Roman size=3]Complete Story: [/FONT][A href=http://www.msnbc.com/news/846145.asp?0si][FONT face=Times New Roman size=3]http://www.msnbc.com/news/846145.asp?0si[/FONT][/A][FONT face=Times New Roman size=3]=-[/FONT][BR][BR][FONT face=Times New Roman][FONT size=3]Chip comments: This article provides additional information on the board compensation. In addition, former UAL president Rono Dutta is currently RSA's conslutant on the US Airways investment. [STRONG]In regard to the pension issue, Roy Fruendlich made some interesting remarks in this article.[/STRONG][/FONT][/FONT][BR][BR][STRONG][FONT face=Times New Roman size=3]US Airways to Cut Costs $1.8 Billion a Year[/FONT][/STRONG][BR][BR][FONT face=Times New Roman size=3]NEW YORK (New York Times) - S Airways said yesterday that it would reduce its costs by $1.8 billion a year, or 17 percent, after it emerges from a bankruptcy reorganization through employee wage and benefit concessions, expanded use of regional jets and changes in the way it uses its routes.[/FONT][BR][BR][FONT face=Times New Roman size=3]Complete Story: [/FONT][A href=http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER][FONT face=Times New Roman color=#0000ff size=3]http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER[/FONT][/A][BR][BR][FONT face=Times New Roman size=3][STRONG]US Airways Bankruptcy Plan Concentrates on Cost Cutting[/STRONG][/FONT][BR][BR][FONT face=Times New Roman size=3]WASHINGTON (Washington Post) - After junking its previous plan for emerging from bankruptcy for counting on overly optimistic revenue projections, US Airways filed a new one that relies mostly on far-reaching cost cutting to help it return to profitability by 2004.[/NITF] [/FONT][BR][BR][NITF][FONT face=Times New Roman size=3]As the entire industry grapples with restructuring, our efforts will ensure that we emerge from Chapter 11 protection as a very efficient airline with competitive labor, fleet and operating costs, David N. Siegel, the Arlington-based carrier's chief executive, said in a prepared statement.[/FONT][BR][BR][FONT face=Times New Roman size=3]Complete Story: [/FONT][A href=http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html][FONT face=Times New Roman color=#0000ff size=3]http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html[/FONT][/A][/NITF][FONT face=Times New Roman color=#0000ff size=3] [/FONT]
 

REACC1

Veteran
Aug 20, 2002
514
0
"Babbitt said keeping employees happy should be a major concern for the company, even as it finalizes wage and benefit reductions. "The agreements are a positive step, but the key will be to keep morale up despite the cuts," he said."

We're doomed!!! It is a nice thought though. I don't think a puppet show (Seigel as Austin) will do it.
 

REACC1

Veteran
Aug 20, 2002
514
0
"Babbitt said keeping employees happy should be a major concern for the company, even as it finalizes wage and benefit reductions. "The agreements are a positive step, but the key will be to keep morale up despite the cuts," he said."

We're doomed!!! It is a nice thought though. I don't think a puppet show (Seigel as Austin) will do it.
 

Mike W

Advanced
Dec 9, 2002
225
0
www.usaviation.com
Talk to someone who works for United and see what kind of opinion they have of Rono Dutta.Just like Steve Wolf,they spit on the floor after speaking his name!
 

Mike W

Advanced
Dec 9, 2002
225
0
www.usaviation.com
Talk to someone who works for United and see what kind of opinion they have of Rono Dutta.Just like Steve Wolf,they spit on the floor after speaking his name!
 

delldude

Veteran
Oct 29, 2002
28,211
5,879
Downrange
www.youtube.com
[P]
[BLOCKQUOTE][BR]----------------[BR]On 12/22/2002 9:38:16 AM chipmunn wrote:
[P]
[DIV class=body-head][FONT face='"Times' Roman" New][FONT size=3][STRONG][SPAN class=headline]US Airways lays out plan for return[/SPAN][BR][SPAN class=deck]Major hurdle: $3.1 billion pension liability[/SPAN][/STRONG][BR][SPAN class=byline]TED REED[/SPAN][BR][SPAN class=creditline]Staff Writer[/SPAN][BR][/FONT][/FONT][/DIV][BR][FONT face='"Times' size=3 Roman" New]US Airways unveiled its final plan of reorganization Saturday, a key step toward emerging from bankruptcy court protection.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Now the airline must negotiate with regulators on what to do about the $3.1 billion liability in its pilots' pension plan. It must also secure a federal guarantee for $900 million in loans, and persuade employees to approve new contract terms.[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]"The plan is solid," said David Bronner, chief of Retirement Systems of Alabama, which will hold controlling interest in the airline when the bankruptcy case ends. "But we have more hurdles."[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan, which reduces costs by $1.8 billion annually, reiterates US Airways' intention to emerge from bankruptcy court protection by March 31. US Airways said it remains committed to Charlotte, a medium-size city with a big city airport only because it is the site of the airline's busiest hub.[STRONG][EM]pittsburgh's moving to birmingham.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan brings more regional jets into Charlotte/Douglas International Airport. It also encourages US Airways passengers to fly on United Airlines flights to the west, Asia and Latin America, through a partnership that took effect last month.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways employs 6,869 workers in Charlotte and operates 460 daily departures to 108 nonstop destinations, accounting for more than 90 percent of the flights at Charlotte/Douglas.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Like other airlines, US Airways continues to suffer from the combined impact of a slow economy and a reluctance to fly following the Sept. 11 terrorist attacks. United, the second-largest carrier, recently followed US Airways -- the seventh largest -- into bankruptcy court protection .[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]As the airline industry pares down in size and re-examines its pricing structure, some experts see an emerging trend toward lower business fares and higher leisure fares. The trend could benefit Charlotte business travelers, who pay some of the highest fares in the country.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]In an interview, Bronner said US Airways' most critical immediate problem is to work out a solution to its pension issues with the Pension Benefit Guaranty Corp., the government agency that oversees pension plans.[STRONG][EM]or i'll shut down hte airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways has fallen behind in funding its pilot pensions because of poor stock market performance and reduced interest rates. Pilots have agreed to lower pension benefits, but it is unclear whether their agreement fully addresses the PBGC's concerns.[STRONG][EM](keyword:pilots pension's)[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]"We have done everything humanly possible, and so have employees and management," Bronner said. "But now a Pension Benefit Guaranty Corp. solution has to be gotten. We don't have the PBGC people on board yet. We are working to try to get there."[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]If the airline can work out a solution to its pension plan issues, it should be able to secure federal loan backing, already conditionally approved by the Air Transportation Stability Board.[STRONG][EM]if not i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan, filed late Friday in Federal Bankruptcy Court in Alexandria, Va., said the airline expects a pre-tax loss of $229 million in 2003, but will gradually improve to pre-tax income of $587 million in 2009. The ATSB loan would be repaid in 2009.[STRONG][EM]unless i shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan also spells out the revised structure of a 15-member US Airways board and of its ownership group. Alabama Retirement Systems would have eight of 15 board members and hold 36.6 percent of Class A stock and 100 percent of class B stock.[STRONG][EM]ahh ha ha,you thought seven was bad?[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Under the plan, existing shares of US Airways stock will be wiped out. In a statement, the airline urged investors "to use caution in existing and future investments" in its existing shares. The shares continue to trade, closing Friday at 44 cents.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways has said it will continue to focus on its hubs in Charlotte, Philadelphia and Pittsburgh, and on three key airports: New York LaGuardia, Washington National and Boston Logan.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]It will seek to improve revenues by operating more regional jets (230 by 2006) and through the United partnership, which is expected to improve revenues by $100 million to $150 million annually.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Also, US Airways has cut its supply of airplanes and seats, hoping an economic recovery will jump-start demand for travel.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Reducing capacity represents an effort to eliminate the need to attract passengers with heavily discounted leisure fares, said veteran aviation consultant Morton Beyer.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]In some cases, adding regional jets serves to reduce capacity. "Charlotte is pretty much the (main) hub of US Airways and I think that as long as they have a monopoly, they will try to maintain fares," Beyer said.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]At the same time, however, airlines have been experimenting with an effort to increase leisure fares and reduce the high level of business fares, sold to travelers who fly weekdays on short notice.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Beyer said US Airways will likely join in that effort, which "appears to be working."[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]During the bankruptcy case, Alabama Retirement Systems is lending US Airways $500 million, which will be repaid with the loans guaranteed by the ATSB.[STRONG][EM]unless i shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Following the bankruptcy, the retirement fund is making a $240 million investment in the airline: its shares are in return for that investment.[STRONG][EM]unless i get what i want.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways filed the plan after securing $200 million in concessions from unions during three weeks of negotiations that concluded late Friday. Unions made the new concessions after providing $840 million in concessions last summer. Aircraft lessors, management employees and vendors are also making concessions.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Negotiators agreed reluctantly to the cuts, which include reduced health benefits and turning over union jobs to subcontractors, because they feared the airline could shut down without them. But in most cases, union members still have to vote to approve the cuts.[STRONG][EM]stay tuned,we're going back again in 3 weeks.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The airline said Saturday that "quick ratification ... is critical" because the plan's assumptions include the reductions, and the ATSB won't approve a plan that doesn't assure loan repayment.[EM][STRONG] quick ratification is needed so we can start to renegotiate pensions. [/STRONG][/EM][/FONT][BR][FONT face='"Times' size=3 Roman" New]The plan lays out a liquidation scenario, which could include changing the Chapter 11 bankruptcy to a Chapter 7 bankruptcy. The airline said those details are provided only because they are required under bankruptcy law and because they demonstrate that creditors get more money if the airline continues to operate.[STRONG][EM]i always get what i want.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]While US Airways' wholly owned subsidiaries US Airways Express carriers also filed for bankruptcy protection in August, the airline said they will not necessarily emerge at the same time unless they reach cost-saving labor agreements.[/FONT][/SPAN][!-- end body-content --][!-- begin body-end --][BR][BR]
[DIV class=body-end][BR][BR]
[DIV class=tagline][/DIV][/DIV][/SPAN][STRONG][FONT face='"Times' size=3 Roman" New]US Airways files reorganization plan - Bankruptcy proposal follows new concession from unions[/FONT][/STRONG][BR][BR][FONT face='"Times' size=3 Roman" New]ARLINGTON (AP/MSNBC.com) - US Airways Group announced Saturday that it had filed a proposed reorganization plan that hinges on the airline’s securing a $1 billion federal loan guarantee, a $240 million investment from the Alabama state pension fund and pay givebacks by the airline’s employees. [/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.msnbc.com/news/846145.asp?0si"'][FONT face='"Times' size=3 Roman" New]http://www.msnbc.com/news/846145.asp?0si[/FONT][/A][FONT face='"Times' size=3 Roman" New]=-[/FONT][BR][BR][FONT face='"Times' Roman" New][FONT size=3]Chip comments: This article provides additional information on the board compensation. In addition, former UAL president Rono Dutta is currently RSA's conslutant on the US Airways investment. [STRONG]In regard to the pension issue, Roy Fruendlich made some interesting remarks in this article.[/STRONG][/FONT][/FONT][BR][BR][STRONG][FONT face='"Times' size=3 Roman" New]US Airways to Cut Costs $1.8 Billion a Year[/FONT][/STRONG][BR][BR][FONT face='"Times' size=3 Roman" New]NEW YORK (New York Times) - S Airways said yesterday that it would reduce its costs by $1.8 billion a year, or 17 percent, after it emerges from a bankruptcy reorganization through employee wage and benefit concessions, expanded use of regional jets and changes in the way it uses its routes.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER"'][FONT face='"Times' color=#0000ff size=3 Roman" New]http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER[/FONT][/A][BR][BR][FONT face='"Times' size=3 Roman" New][STRONG]US Airways Bankruptcy Plan Concentrates on Cost Cutting[/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]WASHINGTON (Washington Post) - After junking its previous plan for emerging from bankruptcy for counting on overly optimistic revenue projections, US Airways filed a new one that relies mostly on far-reaching cost cutting to help it return to profitability by 2004.[/NITF] [/FONT][BR][BR][NITF][FONT face='"Times' size=3 Roman" New]"As the entire industry grapples with restructuring, our efforts will ensure that we emerge from Chapter 11 protection as a very efficient airline with competitive labor, fleet and operating costs," David N. Siegel, the Arlington-based carrier's chief executive, said in a prepared statement.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html"'][FONT face='"Times' color=#0000ff size=3 Roman" New]http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html[/FONT][/A][/NITF][FONT face='"Times' color=#0000ff size=3 Roman" New] [/FONT]
[P][/P]----------------[/BLOCKQUOTE]
[P][/P][STRONG][EM][/EM][/STRONG]
 

delldude

Veteran
Oct 29, 2002
28,211
5,879
Downrange
www.youtube.com
[P]
[BLOCKQUOTE][BR]----------------[BR]On 12/22/2002 9:38:16 AM chipmunn wrote:
[P]
[DIV class=body-head][FONT face='"Times' Roman" New][FONT size=3][STRONG][SPAN class=headline]US Airways lays out plan for return[/SPAN][BR][SPAN class=deck]Major hurdle: $3.1 billion pension liability[/SPAN][/STRONG][BR][SPAN class=byline]TED REED[/SPAN][BR][SPAN class=creditline]Staff Writer[/SPAN][BR][/FONT][/FONT][/DIV][BR][FONT face='"Times' size=3 Roman" New]US Airways unveiled its final plan of reorganization Saturday, a key step toward emerging from bankruptcy court protection.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Now the airline must negotiate with regulators on what to do about the $3.1 billion liability in its pilots' pension plan. It must also secure a federal guarantee for $900 million in loans, and persuade employees to approve new contract terms.[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]"The plan is solid," said David Bronner, chief of Retirement Systems of Alabama, which will hold controlling interest in the airline when the bankruptcy case ends. "But we have more hurdles."[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan, which reduces costs by $1.8 billion annually, reiterates US Airways' intention to emerge from bankruptcy court protection by March 31. US Airways said it remains committed to Charlotte, a medium-size city with a big city airport only because it is the site of the airline's busiest hub.[STRONG][EM]pittsburgh's moving to birmingham.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan brings more regional jets into Charlotte/Douglas International Airport. It also encourages US Airways passengers to fly on United Airlines flights to the west, Asia and Latin America, through a partnership that took effect last month.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways employs 6,869 workers in Charlotte and operates 460 daily departures to 108 nonstop destinations, accounting for more than 90 percent of the flights at Charlotte/Douglas.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Like other airlines, US Airways continues to suffer from the combined impact of a slow economy and a reluctance to fly following the Sept. 11 terrorist attacks. United, the second-largest carrier, recently followed US Airways -- the seventh largest -- into bankruptcy court protection .[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]As the airline industry pares down in size and re-examines its pricing structure, some experts see an emerging trend toward lower business fares and higher leisure fares. The trend could benefit Charlotte business travelers, who pay some of the highest fares in the country.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]In an interview, Bronner said US Airways' most critical immediate problem is to work out a solution to its pension issues with the Pension Benefit Guaranty Corp., the government agency that oversees pension plans.[STRONG][EM]or i'll shut down hte airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways has fallen behind in funding its pilot pensions because of poor stock market performance and reduced interest rates. Pilots have agreed to lower pension benefits, but it is unclear whether their agreement fully addresses the PBGC's concerns.[STRONG][EM](keyword:pilots pension's)[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]"We have done everything humanly possible, and so have employees and management," Bronner said. "But now a Pension Benefit Guaranty Corp. solution has to be gotten. We don't have the PBGC people on board yet. We are working to try to get there."[STRONG][EM]or i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]If the airline can work out a solution to its pension plan issues, it should be able to secure federal loan backing, already conditionally approved by the Air Transportation Stability Board.[STRONG][EM]if not i'll shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan, filed late Friday in Federal Bankruptcy Court in Alexandria, Va., said the airline expects a pre-tax loss of $229 million in 2003, but will gradually improve to pre-tax income of $587 million in 2009. The ATSB loan would be repaid in 2009.[STRONG][EM]unless i shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The plan also spells out the revised structure of a 15-member US Airways board and of its ownership group. Alabama Retirement Systems would have eight of 15 board members and hold 36.6 percent of Class A stock and 100 percent of class B stock.[STRONG][EM]ahh ha ha,you thought seven was bad?[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Under the plan, existing shares of US Airways stock will be wiped out. In a statement, the airline urged investors "to use caution in existing and future investments" in its existing shares. The shares continue to trade, closing Friday at 44 cents.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways has said it will continue to focus on its hubs in Charlotte, Philadelphia and Pittsburgh, and on three key airports: New York LaGuardia, Washington National and Boston Logan.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]It will seek to improve revenues by operating more regional jets (230 by 2006) and through the United partnership, which is expected to improve revenues by $100 million to $150 million annually.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Also, US Airways has cut its supply of airplanes and seats, hoping an economic recovery will jump-start demand for travel.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Reducing capacity represents an effort to eliminate the need to attract passengers with heavily discounted leisure fares, said veteran aviation consultant Morton Beyer.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]In some cases, adding regional jets serves to reduce capacity. "Charlotte is pretty much the (main) hub of US Airways and I think that as long as they have a monopoly, they will try to maintain fares," Beyer said.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]At the same time, however, airlines have been experimenting with an effort to increase leisure fares and reduce the high level of business fares, sold to travelers who fly weekdays on short notice.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Beyer said US Airways will likely join in that effort, which "appears to be working."[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]During the bankruptcy case, Alabama Retirement Systems is lending US Airways $500 million, which will be repaid with the loans guaranteed by the ATSB.[STRONG][EM]unless i shut down the airline.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Following the bankruptcy, the retirement fund is making a $240 million investment in the airline: its shares are in return for that investment.[STRONG][EM]unless i get what i want.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]US Airways filed the plan after securing $200 million in concessions from unions during three weeks of negotiations that concluded late Friday. Unions made the new concessions after providing $840 million in concessions last summer. Aircraft lessors, management employees and vendors are also making concessions.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Negotiators agreed reluctantly to the cuts, which include reduced health benefits and turning over union jobs to subcontractors, because they feared the airline could shut down without them. But in most cases, union members still have to vote to approve the cuts.[STRONG][EM]stay tuned,we're going back again in 3 weeks.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]The airline said Saturday that "quick ratification ... is critical" because the plan's assumptions include the reductions, and the ATSB won't approve a plan that doesn't assure loan repayment.[EM][STRONG] quick ratification is needed so we can start to renegotiate pensions. [/STRONG][/EM][/FONT][BR][FONT face='"Times' size=3 Roman" New]The plan lays out a liquidation scenario, which could include changing the Chapter 11 bankruptcy to a Chapter 7 bankruptcy. The airline said those details are provided only because they are required under bankruptcy law and because they demonstrate that creditors get more money if the airline continues to operate.[STRONG][EM]i always get what i want.[/EM][/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]While US Airways' wholly owned subsidiaries US Airways Express carriers also filed for bankruptcy protection in August, the airline said they will not necessarily emerge at the same time unless they reach cost-saving labor agreements.[/FONT][/SPAN][!-- end body-content --][!-- begin body-end --][BR][BR]
[DIV class=body-end][BR][BR]
[DIV class=tagline][/DIV][/DIV][/SPAN][STRONG][FONT face='"Times' size=3 Roman" New]US Airways files reorganization plan - Bankruptcy proposal follows new concession from unions[/FONT][/STRONG][BR][BR][FONT face='"Times' size=3 Roman" New]ARLINGTON (AP/MSNBC.com) - US Airways Group announced Saturday that it had filed a proposed reorganization plan that hinges on the airline’s securing a $1 billion federal loan guarantee, a $240 million investment from the Alabama state pension fund and pay givebacks by the airline’s employees. [/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.msnbc.com/news/846145.asp?0si"'][FONT face='"Times' size=3 Roman" New]http://www.msnbc.com/news/846145.asp?0si[/FONT][/A][FONT face='"Times' size=3 Roman" New]=-[/FONT][BR][BR][FONT face='"Times' Roman" New][FONT size=3]Chip comments: This article provides additional information on the board compensation. In addition, former UAL president Rono Dutta is currently RSA's conslutant on the US Airways investment. [STRONG]In regard to the pension issue, Roy Fruendlich made some interesting remarks in this article.[/STRONG][/FONT][/FONT][BR][BR][STRONG][FONT face='"Times' size=3 Roman" New]US Airways to Cut Costs $1.8 Billion a Year[/FONT][/STRONG][BR][BR][FONT face='"Times' size=3 Roman" New]NEW YORK (New York Times) - S Airways said yesterday that it would reduce its costs by $1.8 billion a year, or 17 percent, after it emerges from a bankruptcy reorganization through employee wage and benefit concessions, expanded use of regional jets and changes in the way it uses its routes.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER"'][FONT face='"Times' color=#0000ff size=3 Roman" New]http://www.nytimes.com/2002/12/22/business/22AIR.html?ex=1041224400&en=75205046aeb8e8f2&ei=5040&partner=MOREOVER[/FONT][/A][BR][BR][FONT face='"Times' size=3 Roman" New][STRONG]US Airways Bankruptcy Plan Concentrates on Cost Cutting[/STRONG][/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]WASHINGTON (Washington Post) - After junking its previous plan for emerging from bankruptcy for counting on overly optimistic revenue projections, US Airways filed a new one that relies mostly on far-reaching cost cutting to help it return to profitability by 2004.[/NITF] [/FONT][BR][BR][NITF][FONT face='"Times' size=3 Roman" New]"As the entire industry grapples with restructuring, our efforts will ensure that we emerge from Chapter 11 protection as a very efficient airline with competitive labor, fleet and operating costs," David N. Siegel, the Arlington-based carrier's chief executive, said in a prepared statement.[/FONT][BR][BR][FONT face='"Times' size=3 Roman" New]Complete Story: [/FONT][A href='http://www.usaviation.com/idealbb/"http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html"'][FONT face='"Times' color=#0000ff size=3 Roman" New]http://www.washingtonpost.com/wp-dyn/articles/A23713-2002Dec21.html[/FONT][/A][/NITF][FONT face='"Times' color=#0000ff size=3 Roman" New] [/FONT]
[P][/P]----------------[/BLOCKQUOTE]
[P][/P][STRONG][EM][/EM][/STRONG]
 

Cohiba

Member
Aug 20, 2002
29
0
www.usaviation.com
[blockquote]
----------------
On 12/22/2002 12:07:49 PM PineyBob wrote:

Well I have been treated so poorly by UA and their staff that frankly I feel that if the employees hate Mr. Dutta than he must be doing something right and that might be a good thing! But alas they are our partners now in the "Chapter 22 Alliance"
----------------
[/blockquote]


On 12/22/2002 4:59:03 PM PineyBob wrote:


NEWS FLASH! It's all about ME!
----------------


Our partners? When did you become one of "our partners".

You slay me !
 

Cohiba

Member
Aug 20, 2002
29
0
www.usaviation.com
[blockquote]
----------------
On 12/22/2002 12:07:49 PM PineyBob wrote:

Well I have been treated so poorly by UA and their staff that frankly I feel that if the employees hate Mr. Dutta than he must be doing something right and that might be a good thing! But alas they are our partners now in the "Chapter 22 Alliance"
----------------
[/blockquote]


On 12/22/2002 4:59:03 PM PineyBob wrote:


NEWS FLASH! It's all about ME!
----------------


Our partners? When did you become one of "our partners".

You slay me !
 

Mike W

Advanced
Dec 9, 2002
225
0
www.usaviation.com
PineyBob,
Thank you.It's good to see someone appreciates the effort this employee group has put forth in the last six months.We've had our backs to the wall longer than I care to think about.For the employees of this airline to have put up the performance numbers thay have says what kind of professionalism exists at US Airways.All we're looking for is someone to lead us.Unfortunately,I'm still not convinced that Dave and company are the right ones.It doesn't take a lot of imagination to cut.Any fool can do that.It does take some to generate revenue,something the current management hasn't proved they can do.
 

Mike W

Advanced
Dec 9, 2002
225
0
www.usaviation.com
PineyBob,
Thank you.It's good to see someone appreciates the effort this employee group has put forth in the last six months.We've had our backs to the wall longer than I care to think about.For the employees of this airline to have put up the performance numbers thay have says what kind of professionalism exists at US Airways.All we're looking for is someone to lead us.Unfortunately,I'm still not convinced that Dave and company are the right ones.It doesn't take a lot of imagination to cut.Any fool can do that.It does take some to generate revenue,something the current management hasn't proved they can do.