lowecur
Well-known member
- Joined
- Sep 14, 2003
- Posts
- 2,317
In this interview Bronner revelled that UAIR's costs will be lower than SWA if the IAM doesn't mess things up. This I gotta see.
US Airways funding extended
[font=times new roman,serif]RSA's Bronner optimistic about future of airline after positive talks with union negotiators[/font]
[font=arial,helvetica,sans-serif]By M.J. Ellington
DAILY Staff Writer[/font]
[email protected] · (334) 262-1104
[font=times new roman,serif]MONTGOMERY — A decision Thursday to extend federal funding protection, along with positive talks with union negotiators, makes David Bronner more optimistic about the future of US Airways.[/font]
[font=times new roman,serif]Bronner, Retirement Systems of Alabama CEO, said the federal Air Transportation Stabilization Board extended current funding agreements at least until June 30, giving the airline more time to stabilize financially. RSA is the largest shareholder in US Airways, which filed for Chapter 11 bankruptcy for the second time in September.[/font]
[font=times new roman,serif]The ATSB, created after the Sept. 11 attacks to help the industry recover from a severe downturn, gave the airline a $900 million federally guaranteed loan when it emerged from its first trip into bankruptcy in March 2003.[/font]
[font=times new roman,serif]According to court documents, US Airways still owes the ATSB about $646 million of the original $900 million loan as of year's end. The airline has been using the cash to fund basic operations while in bankruptcy.[/font]
[font=times new roman,serif]The extension comes after US Airways extracted more than $800 million in annual concessions from its labor unions. Most unions reluctantly agreed to accept pay and benefit cuts, but a judge last week imposed an estimated $269 million in concessions on the International Association of Machinists when that union failed to reach a deal.[/font]
[font=times new roman,serif]Bronner said IAM will vote in the next two weeks whether to strike, but he feels recent talks give hope of avoiding a walkout. [/font]
[font=times new roman,serif]"We have basically taken US Airways from one end of the football field to the other," Bronner said. "We are the only airline in the U.S. that has come to agreement with all its unions except one, the IAM. We feel relatively confident there. I'm relatively excited about how far we have come as compared to everybody else."[/font]
[font=times new roman,serif]Bronner said RSA has talked to the head of the union.[/font]
[font=times new roman,serif]"He knows it is tough, but he knows there is no other option," said Bronner. "The court has already set aside his contract. When the court sets aside a contract, you basically put out the last offer to the membership."[/font]
[font=times new roman,serif]Changes that Bronner said are necessary to keep the airline flying have been hard, but he said they may succeed.[/font]
[font=times new roman,serif]"You have to understand that we're trying to do something that has never been done in the history of airlines, to take a legacy carrier to a low-cost carrier status," Bronner said.[/font]
[font=arial,helvetica,sans-serif]Union choice[/font]
[font=times new roman,serif]The union's decision is the key at this point.[/font]
[font=times new roman,serif]"If IAM strikes, then we will have problems," Bronner said. "Assuming that the IAM goes along with us in two weeks, then we'll have lower costs than Southwest."[/font]
[font=times new roman,serif]Bronner said it is hard to predict when the airline may become profitable again, partly because of fluctuating oil prices.[/font]
[font=times new roman,serif]"If oil went down $10 a barrel, we'd be floating in money," he said. "Assuming that it doesn't go down, the whole airline industry will probably show losses for the whole year in '05. It's all relative to the price of oil."[/font] [font=times new roman,serif]Two other airlines that received federal loan guarantees — ATA Airlines and Aloha Airlines — have also subsequently filed for bankruptcy.[/font]
US Airways funding extended
[font=times new roman,serif]RSA's Bronner optimistic about future of airline after positive talks with union negotiators[/font]
[font=arial,helvetica,sans-serif]By M.J. Ellington
DAILY Staff Writer[/font]
[email protected] · (334) 262-1104
[font=times new roman,serif]MONTGOMERY — A decision Thursday to extend federal funding protection, along with positive talks with union negotiators, makes David Bronner more optimistic about the future of US Airways.[/font]
[font=times new roman,serif]Bronner, Retirement Systems of Alabama CEO, said the federal Air Transportation Stabilization Board extended current funding agreements at least until June 30, giving the airline more time to stabilize financially. RSA is the largest shareholder in US Airways, which filed for Chapter 11 bankruptcy for the second time in September.[/font]
[font=times new roman,serif]The ATSB, created after the Sept. 11 attacks to help the industry recover from a severe downturn, gave the airline a $900 million federally guaranteed loan when it emerged from its first trip into bankruptcy in March 2003.[/font]
[font=times new roman,serif]According to court documents, US Airways still owes the ATSB about $646 million of the original $900 million loan as of year's end. The airline has been using the cash to fund basic operations while in bankruptcy.[/font]
[font=times new roman,serif]The extension comes after US Airways extracted more than $800 million in annual concessions from its labor unions. Most unions reluctantly agreed to accept pay and benefit cuts, but a judge last week imposed an estimated $269 million in concessions on the International Association of Machinists when that union failed to reach a deal.[/font]
[font=times new roman,serif]Bronner said IAM will vote in the next two weeks whether to strike, but he feels recent talks give hope of avoiding a walkout. [/font]
[font=times new roman,serif]"We have basically taken US Airways from one end of the football field to the other," Bronner said. "We are the only airline in the U.S. that has come to agreement with all its unions except one, the IAM. We feel relatively confident there. I'm relatively excited about how far we have come as compared to everybody else."[/font]
[font=times new roman,serif]Bronner said RSA has talked to the head of the union.[/font]
[font=times new roman,serif]"He knows it is tough, but he knows there is no other option," said Bronner. "The court has already set aside his contract. When the court sets aside a contract, you basically put out the last offer to the membership."[/font]
[font=times new roman,serif]Changes that Bronner said are necessary to keep the airline flying have been hard, but he said they may succeed.[/font]
[font=times new roman,serif]"You have to understand that we're trying to do something that has never been done in the history of airlines, to take a legacy carrier to a low-cost carrier status," Bronner said.[/font]
[font=arial,helvetica,sans-serif]Union choice[/font]
[font=times new roman,serif]The union's decision is the key at this point.[/font]
[font=times new roman,serif]"If IAM strikes, then we will have problems," Bronner said. "Assuming that the IAM goes along with us in two weeks, then we'll have lower costs than Southwest."[/font]
[font=times new roman,serif]Bronner said it is hard to predict when the airline may become profitable again, partly because of fluctuating oil prices.[/font]
[font=times new roman,serif]"If oil went down $10 a barrel, we'd be floating in money," he said. "Assuming that it doesn't go down, the whole airline industry will probably show losses for the whole year in '05. It's all relative to the price of oil."[/font] [font=times new roman,serif]Two other airlines that received federal loan guarantees — ATA Airlines and Aloha Airlines — have also subsequently filed for bankruptcy.[/font]
