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MERGER RUMORS

US Airways CEO Doug Parker issued the following statement to employees today regarding yesterday’s news of the proposed merger between Delta and Northwest and amid continuing airline consolidation speculation.

The actual merger announcement yesterday followed months of speculation. Future merger rumor and speculation, fueled by “aviation experts” and various media “experts”, is likely to increase. There will probably be a new rumor everyday concerning US Airways.

I just wanted to take a minute to convey to the Flight Attendant group that if US Airways becomes a merger partner with another carrier your Union’s number one concern is your future. The Union will not endorse any merger that does not directly benefit each and every one of you.

The Union recognizes the economic environment the industry is operating in but believes that management has it within their power to navigate through this environment without using that as an excuse to not conclude the merger between US Airways and America West or provide the needed raises in pay and benefits that were given up in order for this merger to even take place.

Thank you,

Mike Flores, President
The US Airways Master Executive Council
AFA-CWA

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An Important Message from CEO Doug Parker

April 16, 2008

Dear Fellow Employees,

With the recent news of a potential Delta/Northwest merger, analysts and media are speculating about the next potential combination. While we had hoped to remain on the sidelines of this speculation, today’s Wall Street Journal suggests we may be in merger talks with United and another article in the Dallas Morning News suggests we might make a good merger partner for American.

While I can’t comment on any specific discussions or transaction I certainly didn’t want you to hear this speculation without hearing directly from me about what this might mean for US Airways.

Most of you know my views on consolidation and those have not changed. Our industry is far too fragmented and consolidation, if done properly, could result in a much healthier industry which would be good for our employees, our customers and the communities we serve. Rest assured if US Airways chooses to participate in any industry consolidation, we will do so because we believe it is the best interests of our employees and our airline.

Despite all of the challenges of merging two airlines, we are a much stronger company today as a result of the merger of US Airways and America West. We posted the highest pre-tax margin of the big six airlines in 2006 and even with our operational challenges we posted the second highest pre-tax margin in 2007.

And we have an improving airline. We’ve made great strides with our operational improvement plan, including top three performances in on-time arrivals for three consecutive months. As we continue through 2008, we feel extremely good about our ability to continue to improve our operational performance relative to the industry.

But we can't ignore what's happening in the world around us. Oil has risen to over $113 per barrel and Wall Street is anticipating a recession that, if it happens, will lower all airline revenues. And the DL/NW combination potentially creates a formidable competitor. In that world, all airlines are going to have to make dramatic changes to their existing business models in order to be viable.

I know airline merger speculation can be distracting so for now, I encourage all of us to remain focused on running a great airline. Our work on the reliability, convenience and appearance initiatives continues and we are running an extremely reliable airline as a result. Whatever we do, we will always take great care to ensure the path we choose returns value to our shareholders and customers, and also provides long-term stability for our employees.

Thanks for all you do for our customers and keep up the great work. 

~~~~~~~~~~~~~~~~~

AFA US Airways Website

www.afausairways.org

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AFA Local Numbers
 
Council 41 DCA 703-212-8090
Council 69 BOS 781-289-8454
Council 70 PHL 215-492-0840
Council 82 LGA 315-736-3483
Council 89 CLT 704-527-0325

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US AIRWAYS Benefits Information 800-872-4780

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