US Airways Faults Delta on Rivalry

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chipmunn

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US Airways Faults Delta on Rivalry - US Airways Chief Accuses Delta of Trying to Put It Out of Business

Tuesday September 17, 7:14 pm ET
By MATTHEW BARAKAT, AP Business Writer
WASHINGTON (AP) -- The president of US Airways accused Delta Air Lines of anticompetitive behavior Tuesday, criticizing an alliance Delta is pursuing with two other major carriers.
Delta''s strategy is built on one basic element: US Airways'' failure, the company''s president, David Siegel, said in reference to Delta''s proposed code-share agreement with Continental Airlines and Northwest Airlines.
Siegel referred to the proposed Continental-Delta-Northwest partnership as the Axis of Evil and called Delta Chairman Leo Mullin Dr. Evil.
Under the proposed agreement, the airlines would sell seats on each other''s flights and travelers would be able to get frequent-flier miles on any of the airlines.
Siegel, who is trying to reorganize US Airways in bankruptcy court, delivered his unusually blunt speech to the International Aviation Club of Washington. His comments were an apparent response to previous statements made by Mullin, who said he would pursue an armada of products and subsidiaries to combat a similarly proposed alliance between US Airways and United Airlines.
A Delta spokeswoman denied the three-way alliance being proposed aims to put US Airways out of business.
US Airways, the nation''s seventh-largest carrier, filed for bankruptcy Aug. 11 and has made numerous changes in recent months to get its cost structure in line. Seven of its nine union locals have agreed to wage cuts totaling about $619 million a year; the remaining locals concluded voting Tuesday evening on proposals for an additional $221 million in cuts.
One of the two unions, the Communication Workers of America, ratified its concession package by a 3-to-1 ratio. The deal calls for an 8 percent pay cut, dropping the top rate for its 8,000 passenger service employees to $20.05 an hour. Employees making less than $30,00 a year are exempt from the deal. The amended contract will save the airline $70 million a year.
The last remaining union local, the 6,600 mechanics represented by the International Association of Machinists, was expected to announce its results late Tuesday or early Wednesday. The union rejected the same deal last month by a 57-43 margin, but decided to vote again.
Union officials said some members were unclear about the consequences of a no vote.
If the union rejects the concessions, it''s possible that a bankruptcy judge will invalidate the entire collective bargaining agreement, and the airline could impose its own pay schedule and work rules.
Union leadership offered workers no recommendation on the proposal.
US Airways has eliminated hundreds of flights on unprofitable routes, greatly expanded the use of smaller, cheaper regional jets and proposed a code-sharing agreement with United Airlines, which allows the two carriers to sell tickets on each other''s flights.
The Delta alliance would be 50 percent larger than the US Airways alliance and would constitute 40 percent of all domestic air traffic, Siegel said. In addition, he said, the Delta alliance is anticompetitive because it includes more overlapping routes.
The United-US Airways alliance would feature complementary routes, combining US Airways'' strength in north-south flights on the East Coast with United''s strength in cross-country flights.
Delta spokeswoman Catherine Stengel acknowledged that the proposed Delta alliance is in part a response to the US Airways alliance. But she said the company is not trying to put US Airways out of business.
US Airways is clearly a competitor on key markets such as the East Coast, she said. We welcome all healthy competition.
The two airlines compete in several markets, particularly the lucrative shuttle service between Washington, Boston and New York.
The Justice Department is reviewing both proposals. Siegel said he is confident that the US Airways-United alliance will receive approval in the near future. Last year, the Justice Department rejected a full-scale merger between the two airlines.
 

N305AS

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Aug 20, 2002
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If I had a farm to bet, I'd wager that somewhere in Atlanta, Leo Mullin is hysterically laughing while putting his pinky to the corner of his mouth.
 

michael707767

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Aug 21, 2002
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yeah, try and tell me the USAir/UAL deal was not directed mostly at Delta. What did you expect Delta to do, sit back and let you have an advantage??
 

A320 Driver

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That would be my first choice...YES!!!
 

ITRADE

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DCA/IAD US2
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[P]
[BLOCKQUOTE][BR]----------------[BR]On 9/17/2002 9:06:55 PM luv2fly wrote:
[P]Ok people... throw me a bone here.. all I asked for was ....one billllllion dollars.[BR]This is hilarious.  ROTFLMAO. [/P]----------------[/BLOCKQUOTE]
[P][/P]Well, it would be funny except for the fact that the request is real, and given tonight's vote, he's likely to get it.
 

BDLDFW

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[BLOCKQUOTE dir=ltr style=MARGIN-RIGHT: 0px]
[P][EM]Siegel referred to the proposed Continental-Delta-Northwest partnership as the Axis of Evil and called Delta Chairman Leo Mullin Dr. Evil.[/EM][BR][/P][/BLOCKQUOTE]
[P dir=ltr]Looks like he's been brushing-up on his Gordon Buffoon handbook.[/P]
 

luv2fly

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Aug 21, 2002
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[blockquote]
----------------
On 9/17/2002 11:09:18 PM ITRADE wrote:



[BLOCKQUOTE]
----------------
On 9/17/2002 9:06:55 PM luv2fly wrote:


Ok people... throw me a bone here.. all I asked for was ....one billllllion dollars.
This is hilarious.  ROTFLMAO. [/P]----------------[/BLOCKQUOTE]


[/P]Well, it would be funny except for the fact that the request is real, and given tonight's vote, he's likely to get it.
----------------
[/blockquote]
trade,
It was a joke. But on a more serious note, U still has an enormous uphill battle. Congratulations to the employee group for hanging in there. It shows an incredible amount of courage. Good luck.
 

CSSUP

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Aug 20, 2002
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Now if some creative person can get Daves face on Austins body we can would love to post them side by side for my daily chuckle.
BTW who is mini-me in this story?
 

UAL777flyer

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Aug 20, 2002
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I swear, just when the tension and pressure gets so thick that you could cut it with a knife, along comes some much-needed comic relief.

That picture of Leo's face on Dr. Evil's body is priceless. How much revenue would the three-way codeshare bring to Delta, Leo? 100 Billllllllllllllllllllllllion Dollllllllllllllllllllllllllllllllllllllllllars? Wonder what Mr.Bigglesworth thinks.

There is nothing more comical in this industry than when airline executives, namely CEO's, accuse each other of trying to put them out of business or other shameless deeds. It's amazing they can do it with a straight face. Hello. That is every airline's intent, whether they admit it or not. Do your utmost to put a serious hurt on your competitors. Do you honestly think other airlines would shed any tears if US went under? Hardly. I'm sure Dave realizes that the UA/US codeshare is just as much of a competitive threat to Delta as their three-way is to US. But I realize that Siegel had to eventually go on record about Delta's moves for perception's sake. But Dr. Evil? That's absolutely priceless.

And of course Fred Reid, Leo's trust side-kick, would be mini-me.

JFK Fleet Service, kudos to you for your picture. Any chance you can transpose Dave's face on Austin's body and put them side by side as one poster suggested? I think we'd all get a kick out of it.