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AFA US Airways MEC E-Line
for March 4, 2003 This information is also available on our Web Site http://www.afausairways.org |
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Upcoming Open Enrollment The dates for open enrollment are March 10-March 21. Please be advised, flight attendants that do not wish to make any changes to their current medical/dental options, need not do anything. If you have any questions, please call the USAirways Benefit Center at 800-872-4780 ww.ww.ww.ww.ww.ww.ww. Cleaning Stations The Company has added new cities to the list of cleaning stations a few months ago and this is to remind Flight Attendants that you are not required to empty trash from the seat back pockets or pick up food dropped on the floor. We are only required to pick up papers/magazines, put pillows and blankets back in the overheads and flip the aisle seat belt out of the aisle back into the seat. Flight Attendants do not clean restrooms/lavatories, nor do we empty seat back pockets. ww.ww.ww.ww.ww.ww.ww. US Airways payment delay puts pressure on unions Tuesday March 4, 3:18 pm ET By Jonathan Stempel NEW YORK, March 4 (Reuters) - Bankrupt US Airways Group Inc.'s failure to make $44.5 million of aircraft payments could pressure its already reeling pilots into agreeing to more concessions, analysts said. "It probably makes them feel like they are not the only ones to make big sacrifices," said Bill Rochelle, a bankruptcy partner at Fulbright & Jaworski LLP in New York. "It could be an affirmative step to get the pilots to make concessions on (their) pension plan." US Airways, based in Arlington, Virginia, on Monday said it delayed payments on so-called enhanced equipment trust certificates backed by 23 Airbus planes. It expects to reach agreement on payments relating to the 14 A-319, three A-320 and six A-321 planes during a five-business-day "cure period," spokesman David Castelveter said. The airline announced the missed payments two days after a federal bankruptcy judge said the airline may terminate its $1.6 billion pension plan covering 4,700 pilots. US Airways wants to replace it with an $850 million plan. "Missing a payment here or there puts additional pressure on the pilots," said Joseph Luzinski, senior vice president at Development Specialists Inc., a New York management consulting firm specializing in bankruptcies. "Once you pull the ripcord and things start popping out, it's very difficult to keep everyone in line," he added. While bankrupt companies often delay or miss debt payments, US Airways runs a risk of being unable to make its payments in time and of having lenders take back its planes. That could cause its mainline fleet to fall below the minimum 279 aircraft it agreed to maintain in exchange for pilot wage cuts and productivity improvements. US Airways has 280 aircraft, its Web site shows. "The $44 million is minuscule in the overall restructuring plan, but what they're risking is the possibility that EETC lenders might foreclose," said Stephen Kane, portfolio manager at Metropolitan West Asset Management in Los Angeles, which owns EETCs of bankrupt UAL Corp. (NYSE:UAL - News) unit United Airlines Inc. but not US Airways. "It's a bit of a dangerous game of chicken." An Air Line Pilots Association spokesman, Roy Freundlich, did not immediately return calls seeking comment. TIMELY EXIT NOT GUARANTEED US Airways must now resolve whether pension changes would violate the pilots' contract. A hearing before the National Mediation Board is slated for March 13, five days before a hearing to confirm the Chapter 11 plan is scheduled to begin. The airline, which sought bankruptcy protection in August, said resolving the pension liability issue is the last big hurdle it faces in its Chapter 11 reorganization. It needs to exit bankruptcy by March 31 to obtain a $900 million federal loan guarantee, which in turn would back $1 billion of private financing. The missed payments may reflect overall business weakness. US Airways lost $98.6 million in January on $476 million of operating revenues, short of its projections. "They avoided negotiating with the (Airbus EETC) holders because they thought the economics would allow them to run the airline without impairing the debt on the Airbus fleet," said Rochelle. "If operations are below plan, they may have to take a bite out of holders who had managed to get through the case unscathed." When it first sought protection from creditors, US Airways planned to maintain an all-Airbus fleet, and rejected leases on Boeing Co. (NYSE:BA - News) aircraft. Airbus is 80 percent owned by European Aeronautic Defense and Space Co. (Paris:EAD.PA - News; XETRA:EAD.DE - News) and 20 percent by Britain's BAE Systems Plc (London:BA.L - News). Even if US Airways resolved the EETC issue, it's far from clear that it would emerge from bankruptcy on schedule. "I wouldn't say it's absolutely certain that they will emerge by March 31," said James Corridore, an airline analyst at Standard & Poor's. "They now need to show their operations are now less costly or can be profitable." Luzinski, who worked on Pan Am Corp.'s liquidation, said US Airways has much work ahead of it. "In the next 30 days, will a lot of things be up in the air?" he asked. "Absolutely." ww.ww.ww.ww.ww.ww.ww. US Airways to Alter Pilots'
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C. A. "Chuck" Cannaday
Association of Flight Attendants
Hotline & *E-Line* - US Airways