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Greetings,
AFA 66 eCommunication - Wednesday, August
12, 2009
US Airways Announces Slot Transaction with Delta Air
Lines
TEMPE, Ariz., August 12, 2009 – US
Airways (NYSE: LCC) today announced a transaction with Delta Air
Lines that will allow US Airways to expand service at Ronald
Reagan Washington National Airport (DCA), and enter key business
centers in Brazil and Japan. US Airways will obtain 42 pairs of
Delta’s slots at DCA and acquire the rights to expand to
Tokyo, Japan and Sao Paulo, Brazil. Simultaneously, US Airways
will transfer 125 pairs of its slots to Delta at New York's
LaGuardia Airport (LGA). One slot equals one takeoff or landing;
so one pair of slots equals one roundtrip flight.
US
Airways will retain a significant presence at LGA. The reduction
in flying necessitated by the transfer of LGA slots will be
accomplished through reductions in US Airways Express flying.
The airline does not plan to make any changes to mainline flight
levels, including its popular US Airways Shuttle service with
hourly flights from New York to Boston and Washington. After the
transaction is complete, US Airways will be the third largest
carrier at LGA (based on peak day departures) and will operate
up to 72 peak-day flights.
“We are very excited
about today's announcement which presents an excellent
opportunity to strengthen our network while bringing more jet
air service to smaller communities from our nation's capital,"
said US Airways Chairman and CEO Doug Parker. "This
transaction will improve US Airways’ near and long-term
profitability to the benefit of our employees, our customers,
the communities we serve, and our shareholders.”
The transaction is structured as two simultaneous asset
sales and is expected to be cash neutral to US Airways. US
Airways estimates the transaction will improve profitability by
more than $75 million annually.
Washington,
D.C.
“This is great news
for travelers to and from the Washington, D.C. region,”
said US Airways Senior Vice President, Marketing and Planning
Andrew Nocella. “After the transaction is complete,
US Airways will provide nonstop service from DCA to 15 new daily
destinations, and to further ensure continuity for air
travelers, we also plan to maintain existing service today to
all DCA destinations that Delta may discontinue as a result of
this transaction.”
The 15 new destinations US
Airways will serve from DCA after this transaction include seven
markets that currently have service to/from DCA today
(Cincinnati, Ohio; Des Moines, Iowa; Grand Rapids, Mich.;
Madison, Wis.; Montreal, Canada; Miami, Fla.; and Ottawa,
Canada), as well as eight cities that currently have no daily
nonstop service to/from DCA at this time (Birmingham, Ala.;
Islip, N.Y.; Ithaca, N.Y.; Little Rock, Ark.; Myrtle Beach,
S.C.; Pensacola, Fla.; Savannah, Ga.; and Tallahassee,
Fla.).
Nocella continued, "We also plan to
increase the number of seats we fly at DCA by using larger
dual-class jets. This will increase capacity in a dense market,
where demand continues to be brisk, without the negative effects
of additional congestion."
US Airways will operate 229
peak-day departures at DCA. Following full implementation
of the new schedule, the airline anticipates its passenger
enplanements at DCA will increase by 30 to 35 percent as a
result of the new flights and use of larger aircraft.
However, there will be no increase in net flight activity at DCA
due to Delta’s reduction in slots.
US
Airways’ expanded presence at DCA will create
approximately 100 new US Airways jobs that will be allocated to
DCA and throughout the new regions where the airline is starting
service.
US Airways will also
acquire from Delta the rights to operate daily service at two of
the world’s most important business destinations –
Sao Paulo, Brazil and Tokyo, Japan. These two cities will
complement US Airways’ existing portfolio of more than 50
international destinations in more than 30 countries and
territories across Europe, the Middle East, Latin America, North
America, and the Caribbean.
Nocella elaborated on
the carrier’s anticipated access to those markets,
“Sao Paulo and Tokyo will bolster our international growth
plans for South America and Asia, and this transaction provides
a unique opportunity to expand into two prominent international
business markets where US Airways would otherwise not be able to
operate.”
With today’s transaction, US
Airways has acquired the rights to serve Sao Paulo; and
anticipates starting service to Sao Paulo in the second half of
next year. The airline’s plan to begin daily
Charlotte-Rio de Janeiro service this December remains
unchanged. US Airways will be working with governmental
authorities in both countries to assist it in securing
additional authority to permit daily flights between Charlotte
and both Rio de Janeiro and Sao Paulo.
The Tokyo service
is tentatively scheduled to operate from US Airways’
Phoenix hub using Airbus 330-200 aircraft. It will require
various government approvals and will be contingent upon
economic conditions at the time. The airline does not anticipate
starting Tokyo service until 2012 or later.
LaGuardia
US Airways
will maintain a significant operation at LGA and plans to
operate up to 72 peak-day flights, making it the airport’s
third largest carrier (based on peak day departures).
Mainline flight levels will not be reduced, and the airline will
continue to operate its popular US Airways Shuttle with hourly
service to Washington, D.C. and Boston, as well as service to
Charlotte and Wilmington, N.C. and Philadelphia, and Pittsburgh,
Penn.
US Airways Shuttle at LGA will operate out of
the Marine Air Terminal while service to Charlotte,
Philadelphia, Pittsburgh, and Wilmington will operate from
terminal D. The move to the Marine Air Terminal is
expected to occur in early 2010, and US Airways intends to make
enhancements to meet the needs of Shuttle customers.
With 125 fewer slot pairs at LGA, US Airways plans to
discontinue service to 26 Express destinations served from
LGA. In a separate announcement made earlier today, Delta
Air Lines communicated its intent with regard to the 125 slot
pairs transferred to it by US Airways.
The reduction in
Express flying at LGA will result in the need for approximately
300 fewer employees at US Airways’ wholly owned regional
carrier, Piedmont Airlines. Piedmont CEO Steve Farrow said,
"While this is good news for our parent company, US Airways, it
is very disappointing news for the Piedmont team. Our employees
have done an excellent job of providing service to US Airways
and its customers. We understand the need to optimize assets
though and we will ensure that all affected Piedmont employees
are treated fairly."
Transaction
Highlights:
- US Airways will obtain 42
pairs of slots (roundtrip flights) at Washington, D.C.’s
Reagan National Airport and will acquire the rights to expand to
Sao Paulo and Tokyo.
- US Airways will transfer to Delta
125 pairs of slots currently used to provide US Airways Express
service at LaGuardia.
- US Airways will maintain a
significant presence at LaGuardia Airport including the popular,
business-friendly US Airways Shuttle. No changes are planned for
US Airways’ mainline flight levels at LaGuardia.
- US Airways expects the transaction to improve its
profitability by more than $75 million annually.
mec@afa66.org
www.afa66.org
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