United, US Airways In Codeshare Talks
A year after failing to merge, United Airlines and US Airways again are discussing a cooperative pact, specifically a codeshare arrangement, according to representatives at both carriers.
"We shared information with our pilots making them aware of the possibility of us codesharing with them," said the United spokesperson, "but it is not a certainty, as US Airways is talking also with Continental and Northwest."
"We are talking to most majors and have only ruled out Delta Air Lines because of the overlapping route structures," confirmed the US Airways representative. "We expect to announce an agreement soon."
US Airways desperately needs to align with a domestic and/or international partner to fully utilize its East Coast feeder operations and improve revenues. A new partnership is one element of the US Airways recovery plan currently under consideration by the Air Transportation Stabilization Board. US Airways earlier this month applied to ATSB for $900 million in federally backed loan guarantees.
At United, pilots union leaders are expected to vote today on a tentative proposal reached last week. If approved, the proposal would bring United's pilots into the carrier's financial recovery plan. United, which yesterday announced it will save $430 million by trimming management and administrative employee compensation, said, "If a substantial number of United employees participate in a program of shared sacrifice, United will apply for federal loan guarantees administered by the Air Transportation Stabilization Board."
United and US Airways last July pulled the plug on an attempted integration after federal regulators indicated they would block the deal. Considering United's deteriorating financial performance throughout 2001 and the first half of 2002 and ongoing labor strife, an approved merger would have been particularly problematic.
However, a codeshare agreement would have fewer strings attached and could leverage United's strength from the West Coast and Chicago O'Hare with US Airways' East Coast presence.